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Member Benefits Expense Ratio

Source: R/get-expenses-membbenefits-ratio.R
get_expenses_membbenefits_ratio.Rd

Benefits paid to or for members as a share of total expenses.

Formula:

expenses_membbenefits = member_benefits / total_expenses

Definitional Range

Bounded [0, 1]. Near zero for most public benefit charities; potentially high (above 0.50) for mutual benefit organizations.

Benchmarks and rules of thumb

  • Interpret in the context of the organization's exempt purpose and subsection code.

  • Non-zero values for 501(c)(3) organizations should be reviewed for compliance with private benefit restrictions.

Calculated For: 990 filers only.

Usage

get_expenses_membbenefits_ratio( df,
  member_benefits           = "F9_09_EXP_BEN_PAID_MEMB_TOT",
  total_expenses            = "F9_09_EXP_TOT_TOT",
  winsorize  = 0.98 ,
  range     = "zo",
  sanitize   = TRUE,
  summarize  = FALSE )

Arguments

df

A data.frame containing the fields required for computing the metric.

member_benefits

Benefits paid to or for members (total). )

total_expenses

Total functional expenses.

winsorize

Winsorization proportion between 0 and 1 (default 0.98).

range

Character string specifying the theoretical range of the ratio, used to set winsorization bounds. Default "zo". Options: "np" (negative to positive), "zp" (zero to positive), "zo" (zero to one), "nz" (negative to zero), or a custom "lo;hi" pair (e.g. "0;10").

sanitize

Logical (default TRUE). If TRUE, imputes zero for NA financial fields before computing, respecting form scope.

summarize

Logical (default FALSE). If TRUE, prints summary statistics and density plots for all four output columns.

Value

The original data.frame with four new columns:

  • expenses_membbenefits (raw ratio)

  • expenses_membbenefits_w (winsorized)

  • expenses_membbenefits_z (z-score)

  • expenses_membbenefits_p (percentile rank, 1-100)

Details

Primary uses and key insights

The member benefits expense ratio measures the share of total functional expenses paid out as direct benefits to members. Primarily relevant for membership associations (unions, trade associations, professional societies) where member benefit payments are a core activity. For most public benefit nonprofits this ratio is near zero.

Formula

Benefits paid to or for members (Part IX line 4, Column A) / total expenses. PZ scope - available to both 990 and 990EZ filers.

Canonical citations

  • Frumkin, P. & Keating, E.K. (2001). The price of doing good. Policy and Society, 20(4), 94-112.

Variables used:

  • F9_09_EXP_BEN_PAID_MEMB_TOT: Benefits paid to members (member_benefits)

  • F9_09_EXP_TOT_TOT: Total functional expenses (total_expenses)

Examples

library( fiscal )
data( dat10k )
d <- get_expenses_membbenefits_ratio( df = dat10k )
#> Error in resolve_col(dt, member_benefits): None of the specified columns were found in the data: F9_09_EXP_BEN_PAID_MEMB_TOT
head( d[ , c( "expenses_membbenefits", "expenses_membbenefits_w", "expenses_membbenefits_z", "expenses_membbenefits_p" ) ] )
#> Error: object 'd' not found