The Financial Health Of Denver Kids, Inc. Financial...

Memorandum To: Board of Directors From: Emily Cervantes Date: December 13, 2014 Re: Denver Kids, Inc. – Financial Analysis and Related Matters Introduction This memorandum addresses the financial health of Denver Kids, Inc. (DKI). This analysis will include a brief overview of the organization’s mission, tax-exempt status, governance, and financial statements. Also included is a break-even analysis for a proposed earned income activity for DKI. (1) Overview Denver Kids, Inc. is a 501 (c)(3) organization. The mission of DKI is to support Denver Public Schools’ (DPS) students, grades K-12, who face the personal challenges of higher risk environments to successfully complete high school, pursue post-secondary options, and become†¦show more content†¦83). As part of their duty to develop and approve sound fiscal policies, board members must review and approve proposed budgets, include a review of the budget’s reasonableness, and make sure that financial transactions are correct by spot-checking various financial transactions (Konrad Novak, 2004). Once a budget has been reviewed and approved, the board is responsible for ensuring that there are adequate resources for the implementation of the new budget (Konrad Novak, 2004). However, this does not mean that members of the board are responsible for writing grant proposals, â€Å"rather they must take ultimate responsibility for the financial success of the organizat ion† (Konrad Novak, 2004, p. 84). Although board members designate a fellow board member to act as treasurer, the financial responsibility does not fall on that individual, rather the responsibility is shared equally by each member, hence why it is important that each member acquire a basic knowledge of financial matters for service as a board member (Konrad Novak, 2004). (2) Governance and Internal Controls DKI’s strategic plan includes a campaign to decrease the high school drop out rate in the Denver community called the 2020 Vision and Strategic Plan. Working under the assumption that a student that drops out of high school is twice as likely to experience poverty, DKI hopes to