American Cancer Society Simple Financial Analysis

[Guest guest]

At 11:51 PM 6/19/2004, Elliot wrote:

>But secondly, please do this: Put into a search engine the

>words, " American Cancer Society Salaries " and read some of the

>information you find there. The American Cancer Society, though it

>calls itself " non-profit, " holds a tremendous amount of cash in

>reserve, and its administrative staff is paid so much, the

>organization won't reveal the salaries of its top executives.

>

>Finally, a very significant portion of what the American Cancer

>Society raises through events like " Relay For Life " does NOT go

>toward research, but rather into ACS coffers and into the pockets of

>ACS executives.

 

 

Okay, let's have a closer look. Rather than rely on other websites that

critique the ACS I decided to look at the financial statements myself.

 

According to the 2002 American Cancer Society combined financial

statements,

http://www.cancer.org/downloads/AA/2002_Combined_Financial_Statements.pdf

(PDF, warning large download)

 

Of total expenses, 72% goes to programs, roughly evenly distributed in

quarters for a) academic research b) prevention programs c) detection

programs d) patient & family support programs.

 

7% of expenses is management/administrative

21% is expenses to generate more revenue (fund-raising programs).

 

That's the raw data.

 

On a percentage basis, 7% management expense is comparable to other NGOs.

For example, The Canadian Arthritis Society (also 2002 data) has a 6.3%

management expense and 25.6% expenses to generate more revenue. 68% goes to

programs.

 

On the surface, the two look comparable, and in fact the American Cancer

Society seems to fare better than the Canadian Arthritis Society. The main

difference is scale; the ACS has a revenue of $813m while the Canadian

Arthritis Society has revenues of $24m (in USD). My criticism is that

increasing revenues -- 33 times as much -- one would think that the

management expense of the American Cancer Society could use economies of

scale to get more bang for the buck, especially with the large pharma

donations that don't require as much expense to obtain, as, say, a $50 gift

from Jack & Jill Homeowner.

 

Money doesn't tell the whole story either. How effective is the money used

for programs & services? For example, the Ontario Chapter of the Sierra

Club of Canada has approx 60% management expense. On the surface this looks

horrible compared to the 7% of the American Cancer Society. However you

need to look at the intangibles. The Sierra Club (both in U.S. and Canada)

has a very grassroots approach. You couldn't easily compare the financial

statements of say, the Sierra Club to Greenpeace, even though they are in

the same sector, because of the differences in operational style. The

Sierra Club uses volunteers extensively for campaigning, programs, and even

administration, so there is far more 'bang for the buck'. Amazing things

can be accomplished for very little money.

 

In conclusion, the American Cancer Society is comparable to other " disease

societies " as measured in monetary terms. The actual end value of all

disease society programs is unknown and very difficult to evaluate and

hence compare.

 

David

[Guest guest]

Thanks for what amounts to a correction, David. My apologies for

reportage of other people's figures which may have been quite wrong.

Since the financial picture is not easy to figure out, I will

concentrate on " raison d'etre, " rather than on use of funds raised.

 

Elliot

 

, David Elfstrom

<listbox@e...> wrote:

> At 11:51 PM 6/19/2004, Elliot wrote:

> >But secondly, please do this: Put into a search engine the

> >words, " American Cancer Society Salaries " and read some of the

> >information you find there. The American Cancer Society, though it

> >calls itself " non-profit, " holds a tremendous amount of cash in

> >reserve, and its administrative staff is paid so much, the

> >organization won't reveal the salaries of its top executives.

> >

> >Finally, a very significant portion of what the American Cancer

> >Society raises through events like " Relay For Life " does NOT go

> >toward research, but rather into ACS coffers and into the pockets

of

> >ACS executives.

>

>

> Okay, let's have a closer look. Rather than rely on other websites

that

> critique the ACS I decided to look at the financial statements

myself.

>

> According to the 2002 American Cancer Society combined financial

> statements,

>

http://www.cancer.org/downloads/AA/2002_Combined_Financial_Statements.

pdf

> (PDF, warning large download)

>

> Of total expenses, 72% goes to programs, roughly evenly distributed

in

> quarters for a) academic research b) prevention programs c)

detection

> programs d) patient & family support programs.

>

> 7% of expenses is management/administrative

> 21% is expenses to generate more revenue (fund-raising programs).

>

> That's the raw data.

>

> On a percentage basis, 7% management expense is comparable to other

NGOs.

> For example, The Canadian Arthritis Society (also 2002 data) has a

6.3%

> management expense and 25.6% expenses to generate more revenue. 68%

goes to

> programs.

>

> On the surface, the two look comparable, and in fact the American

Cancer

> Society seems to fare better than the Canadian Arthritis Society.

The main

> difference is scale; the ACS has a revenue of $813m while the

Canadian

> Arthritis Society has revenues of $24m (in USD). My criticism is

that

> increasing revenues -- 33 times as much -- one would think that the

> management expense of the American Cancer Society could use

economies of

> scale to get more bang for the buck, especially with the large

pharma

> donations that don't require as much expense to obtain, as, say, a

$50 gift

> from Jack & Jill Homeowner.

>

> Money doesn't tell the whole story either. How effective is the

money used

> for programs & services? For example, the Ontario Chapter of the

Sierra

> Club of Canada has approx 60% management expense. On the surface

this looks

> horrible compared to the 7% of the American Cancer Society. However

you

> need to look at the intangibles. The Sierra Club (both in U.S. and

Canada)

> has a very grassroots approach. You couldn't easily compare the

financial

> statements of say, the Sierra Club to Greenpeace, even though they

are in

> the same sector, because of the differences in operational style.

The

> Sierra Club uses volunteers extensively for campaigning, programs,

and even

> administration, so there is far more 'bang for the buck'. Amazing

things

> can be accomplished for very little money.

>

> In conclusion, the American Cancer Society is comparable to

other " disease

> societies " as measured in monetary terms. The actual end value of

all

> disease society programs is unknown and very difficult to evaluate

and

> hence compare.

>

> David