127: Waiting for the Cat | Nonprofit Audits & Financial Transparency with Peter Farstad
Release Date: 12/12/2024
156: Captain Depressio Reporting for Duty | Can Nonprofits Give Tax-Free Money to People?
Charity Therapy
Nonprofits are tax-exempt, so lots of people assume that nonprofits don’t have to worry about taxes ever. Right???? Well, not quite 😐 In this episode, Meghan and I dig into a question I hear all the time from people who want to help their communities but are confused about how nonprofit tax rules actually work. Real Listener Question: “I own a couple of restaurants and we have several events to raise money for certain causes. Usually the money goes toward a charity or a local group, but sometimes we'll do it for a community member who needs financial support. The problem we're seeing is...
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155: Baby Don’t Hurt Me | What To Do When a Donor Gift Harms More Than Helps
Charity Therapy
You’re getting donations for a nonprofit – and that’s great! But sometimes generosity comes with strings you never expected. In this episode, Meghan and I dig into the wild world of donor gifts and why nonprofits need clear guardrails to protect themselves from gifts that actually hurt the nonprofit. Real Listener Question: “We have a donation button on our website where people can give online and set up recurring donations for monthly contributions. A few weeks ago, someone set up a daily 50 cent donation. Our accountant looked into it and is saying that it's not fraud or anything...
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154: It's Gravy, Baby! | What is a Nonprofit Audit? with Hannah Hugen
Charity Therapy
Think an audit is something to fear for your nonprofit? I get it! But what if it’s actually a powerful tool for growth? In this episode, I sit down with nonprofit auditor Hannah Hugen from to unpack what an audit really is and why it’s not nearly as scary as it sounds. Real Listener Question: “We filed the 1023-EZ and said we’d stay under $50K… but now a funding opportunity would push us past that. Will the IRS audit us? Should we say no to the money?” Hannah and I dig into what an audit actually involves, what the IRS does (and doesn’t) care about, and how nonprofits can...
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153: It's a Triple Whammy | How to Fix the Culture of Overwork at Your Nonprofit with Rachel Platt
Charity Therapy
If your team is exhausted, overwhelmed, and constantly working nights and weekends, you might be dealing with more than a scheduling issue. You might be dealing with a culture problem that is hurting your mission. In this episode, I invited my friend and people strategy expert to talk with me about the hidden issues inside nonprofit overwork and what it really takes to build a sustainable organizational culture. Real Listener Question: I’m a new staff member, and everyone at this nonprofit works tons of overtime without being paid (as hourly employees). The ED works all the time, and the...
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152: That's Called Tax Fraud! | When an Entrepreneur has a "Really Good" Nonprofit Idea
Charity Therapy
You’ve got a great business idea, people want to donate to help, and you’re thinking… “What if I just start a nonprofit?” Hold up — let’s talk about it. In this episode, Meghan and I tackle one of the most common (and most frustrating) misconceptions out there — when entrepreneurs try to mix business ventures with nonprofit structures. Real Listener Question: “I’m coaching a small business owner who wants to restore a historic hotel, turn it into an Airbnb, and start a nonprofit to collect donations for the renovation. He says it’s a win-win — is that legal?” This one...
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151: Give Mark Your Crap! | When a PEO is a Good Fit for Your HR Needs with Mark Bromberg
Charity Therapy
Nonprofit HR can be messy — but it doesn’t have to be. Let’s talk about when it’s time to call in reinforcements (and what “reinforcements” actually look like). I sat down with Mark Bromberg, a Business Performance Advisor at Insperity and one of my favorite people to send clients to when HR headaches start taking over. We dug into what PEOs (Professional Employer Organizations) really do — and when they make sense for nonprofits. Real Listener Question: “Our professional association has seven employees. We’re losing our CEO soon, and our board wants to consider...
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150: All Press is Good Press? | GoFundMe Creates 1.4M Nonprofit Donation Pages Without Consent with Ephraim Gopin
Charity Therapy
What happens when a for-profit giant “helps” nonprofits without asking first? Spoiler: chaos, confusion, and a lot of angry fundraisers. In this episode, I sat down with my good friend and fundraising pro, Ephraim Gopin of 1832 Communications, to unpack the wild story of GoFundMe auto-creating donation pages for 1.4 million nonprofits — without their consent. Real Listener Question: “What do we do if our nonprofit suddenly has a GoFundMe page we didn’t create? Is that even legal?” When news broke that GoFundMe scraped IRS data to create “official” donation pages for nonprofits,...
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149: Um, Actually... | How Many Times Should a Nonprofit Board of Directors Meet?
Charity Therapy
If your board hasn’t met in ten months, that’s not just awkward — it’s a big problem. In this episode, Meghan and I dive into a basic (but often overlooked) part of nonprofit governance: how often a board needs to meet, and what happens when it doesn’t. Real Listener Question: “My wife joined the board of a small arts nonprofit, but they haven’t met once in ten months. The executive director sends quarterly updates by email — that’s it. Is that legal?” A board that never meets isn’t really a board — it’s a liability. Meghan and I talk about what state laws and bylaws...
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148: Type A Personalities Unite! | When Nonprofits Should (Or Shouldn't!) Use PEOs for Their HR with Jess Holst
Charity Therapy
Think a PEO will solve all your nonprofit’s HR headaches? Not so fast — the fine print might surprise you. In this episode, I’m joined by HR consultant Jess Holst from to answer a listener’s question about whether a professional employer organization (PEO) is the right solution for their growing nonprofit. Real Listener Question: “We’ve grown from four employees to nearly twelve. I’ve been handling payroll and HR myself, but it’s becoming too much. A board member suggested a PEO, but it feels too good to be true. Should we do it?” PEOs get sold as a one-stop HR solution, but...
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147: Keep Doing You, Boo | Are Nonprofit DEI Initiatives Illegal? With Guest Megan Fuciarelli
Charity Therapy
Worried your nonprofit’s DEI programs might be illegal now? You’re not alone — and I can bet you won’t be able to find the right answer on social media. In this episode, I’m joined by Megan Fuciarelli from US2 Consulting to dig into what the latest EEOC guidance actually means for nonprofits trying to foster inclusion. Real Listener Question: “My nonprofit has employee resource groups (ERGs) for LGBTQ+, Latinx, Black, and AAPI staff. They’re popular, but I heard the EEOC says they might count as discrimination now. Do we need to shut them down, or is there a way to keep them...
info_outlineToday, we’re diving deep into the world of nonprofit financial audits with my amazing guest, Peter Farstad. Peter is a pro when it comes to nonprofit finance, and he's here to help us unravel the sometimes scary world of audits and financial transparency. We know how daunting those big, scary financial statements can seem, especially if you're a Minnesota nonprofit pulling in over $750,000 a year.
In this episode of Charity Therapy, Peter and I chat about why sharing your financial audits with donors isn’t just a good idea—it’s a trust-builder! We totally get why your executive director might be hesitant about posting those reports online, especially if it’s a new practice. But fear not! We’ll give you the lowdown on gently nudging your organization toward more transparency, which is key for building donor trust and credibility. Plus, we throw in some humor and personal stories to keep things light because, let’s face it, finances can be a snooze-fest without a little laughter.
Whether you're a new development director or a seasoned pro looking to up your game, this episode is packed with practical tips and a good dose of empathy. Let’s dive in and make financial transparency a fun and achievable goal for your nonprofit!
In this episode, you will hear:
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Peter Farstad, a nonprofit finance whiz, breaks down the complicated world of nonprofit financial audits
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Audit 101: If you're a nonprofit in Minnesota pulling in over $750k, you're in for a financial audit ride!
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Resources like the National Council of Nonprofits for audits
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Why transparency is key and a superpower for building trust with donors
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How to handle the executive jitters about sharing financial audits
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Tips on how to smooth over any internal awkwardness about financial transparency
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Convincing your team that sharing is caring and how it can take your nonprofit to the next level
Resources from this Episode
Learn more about Peter’s firm: nonprofitfinancialacumen.com
Find out your state’s audit requirements here: www.councilofnonprofits.org/running-nonprofit/nonprofit-audit-guidec/state-law-nonprofit-audit-requirements
Sign up for the Birken Law Email list: birkenlaw.com/signup
Facebook page: www.facebook.com/birkenlaw
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Episode Credits
If you like this podcast and are thinking of creating your own, consider talking to my producer, Emerald City Productions. They helped me grow and produce the podcast you are listening to right now. Find out more at https://emeraldcitypro.com Let them know we sent you.