A foundation is an organization created especially for the purpose of supporting one or more other organizations or causes.  There are public foundations and private foundations.  Many foundations are affiliated with operating organizations that they support (e.g., college and university foundations, hospital foundations, church or denominational foundations, etc.).  Private foundations are often formed by an individual, a family, or a business for the purpose of making grants to operating charities, churches, and other publicly-supported 501(c)(3) organizations. Private foundations are subject to an array of tax laws that apply uniquely to them, and that are very different from the laws that apply to public foundations or public charities. Our team at BMWL has extensive experience serving foundations – both public and private. 

Many foundation leaders have come to BMWL for services because of our strong reputation for helping them make sure the financial bases are covered.  They often come to us after working with another accounting firm, and they share with us that they were concerned that their previous firm was not bringing matters to their attention that needed to be addressed.  After asking around among leaders in the nonprofit community, they learned that BMWL is well known for just that – taking a comprehensive and highly professional approach to providing services that include communicating important matters to our clients on a proactive and consistent basis.

A large private foundation sought our assistance in providing independent auditing services.  The foundation had previously been served by a “Big Four” accounting firm.  In addition to serving as the foundation’s independent audit firm, we have assisted the foundation in addressing accounting matters related to investing in “alternative investments” such as hedge funds, limited partnership interests, and other similar assets.  Our firm also advises the foundation with respect to key tax compliance matters.

A large financial institution served as trustee of a sizable private foundation.  The financial institution was concerned that there were compliance issues that were not being adequately addressed.  The foundation engaged BMWL to assist in identifying and addressing the issues and to audit the financial statements.  One of the “Big Four” accounting firms had previously provided services for the foundation.  Our team identified significant compliance issues requiring attention and proactively assisted the foundation in addressing those issues. As a result of our efforts, the foundation received large refunds from the Internal Revenue Service for taxes that had been overpaid in prior years.

Another key area in which we assist our foundation clients is addressing their practices for establishing and documenting executive compensation and addressing the issue of related party transactions.  It is critically important for foundations to handle executive compensation properly.  Additionally, the tax laws for private foundations prohibit many types of related party transactions.  Improper handling of these important matters can result in negative publicity as well as possible (very significant) penalties for both the foundation and the individuals involved.  Our BMWL professionals can help your foundation successfully navigate the rules related to executive compensation and related party transactions – and reduce the risk to your foundation and its leaders.

We assist numerous foundations in areas such as internal controls; board governance matters; risk management; foreign grant-making and direct foreign activities; expenditure responsibility documentation; corporate structure analysis; federal, state, and local tax compliance; representation before tax authorities; and much more.