October 31, 2010; Source: The Post-Standard |Last week NPQ covered a story about the the United Way of Central New York’s Charity navigator rating which was the lowest possible at a “1”. They received the rating for two reasons—because their reserves were down below what is recommended and because their overhead was up—a not uncommon situation in these times of reduced charity. We asked the question then about the legitimacy of the rating during this time of extended recession and we heard back from a number of NPQ readers who felt the Charity Navigator system is flawed even in the best of times. Here is a subsequent letter to the editor from Daniel Moynihan, a CPA in the Syracuse area basically making the same point. He says the article fell completely short in depending upon the Charity Navigator rating for a reasonable assessment of the group’s financial health. “Did you actually consult with a financial expert, such as a certified public accountant, to review the financial results of the United Way of Central New York?” He asked, “I believe if you had, you would have learned of the pitfalls in the Charity Navigator reporting system and the overall financial strength of our local United Way.”
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NPQ is interested in hearing more about what readers think about the watchdog ratings systems in these times—pro and con. Weigh in.—Ruth McCambridge