Standard 10: Ending Net Assets - Avoid accumulating funds that could be used for current program activities. To meet this standard, the charity's unrestricted net assets available for use should not be more than three times the size of the past year's expenses or three times the size of the current year's budget, whichever is higher.
USSFF does not meet this Standard because:
- According to its audited financial statements for the fiscal year ending June 30, 2010, the organization's total unrestricted net assets were $50,484,054, or 7 times the charity's total budgeted expenses of $7,033,044.
In response to this finding, USSFF stated,
"The U.S. Soccer Foundation was created with approximately $56 million of net proceeds from the 1994 World Cup soccer tournament held in the United States. Though these funds were unrestricted at the time, the Foundation’s Board of Directors treated these funds as a form of an endowment and has implemented a spending policy designed to sustain the purchasing power of the corpus in perpetuity.
As a result, the Foundation’s spending policy allows only 6% of the corpus to be spent each year (consistent with the policies of other endowments that were reviewed). While the earnings on the endowment cover the Foundation’s administrative expenses and significant program costs, thereby allowing the Foundation to apply 100% of all additional contributions directly to the program grant awards, the spending policy makes it impossible for the Foundation to increase expenditures enough so that its unrestricted net assets would be less than three (3) times the size of prior year actual expenses or current year budget expenses, as required by this Standard. Based on last year’s expenses, the Foundation’s endowment was approximately seven (7) times expenditures."