Ice bucket challenge flood creates more challenges

Ice Bucket ChallengeAccording to press reports, the Ice Bucket Challenge has produced million in donations for the A.L.S. Association. The A.L.S. Association website at October 3 reports $115 million received since July 29.

The A.L.S. Association (EIN = 13-3271855) is a Washington, D.C. -based nonprofit that funds global research to find treatments and a cure for amyotrophic lateral sclerosis (ALS), commonly known as Lou Gehrig’s disease.

The generous response to the challenge has created a flood of donations. That flood creates more challenges, both for the A.L.S. Association and for donors.

  • The A.L.S. Association now has in reserve 6.7 times the money it spent in its most recently reported year. In other words, it has almost 7 years worth of money. What will it do with the money?
  • From a donor perspective, should you give more money to the A.L.S. Association for the time being? It has plenty of money now.

Perhaps the best approach, even for regular A.L.S. Association donors, is to wait and see how the organization handles the flood. See the A.L.S. Association’s most recent IRS Form 990, showing its finances and operations through January 2013. Adding $115 million to the reported numbers would mean that the A.L.S. Association has about $132.5 million in net assets compared to total expenses of $19.8 million (including $14.6 million of program expenses).