Wednesday, July 13, 2005

NKF - My 2cents

In this ongoing NKF saga, I would like to look at this from another angle. I would like to compare how is NKF utilising the donors' dollars vis-a-vis KDF. The figures used below are taken from their respective websites as follow :


The categories used to report the revenue and expenses are similar, except that there is the category "Dialysis Fee" shown in KDF's and not in NKF's. Doesn't NKF charge its beneficiaries some fees for the treatment? I would assume the dialysis fees collected is included in the category "Other Income" unless NKF are into other business which could generate $25.3 million is revenue in 2003. Why didn't NKF show the dialysis fees collected as a separate item ?

For the purpose of this analysis, I would assume the "Other Income" is the amount of dialysis fees collected. I will amend the figures below if NKF would release the actual dialysis fees collected on their website. Anyway, this figure will be sufficient to provide a good estimate.

The Actual Subsidy is computed by subtracting the Dialysis Fees paid by the beneficiaries from the Direct Charitable Expenses. I can draw the following conclusions :

On average, NKF patients received 32% subsidy while KDF patients received 63% subsidy on the cost of dialysis treatment.

On average, for every dollar of donation, NKF spends 18 cents to subsidise patients' treatment, 45 cents on other operating and marketing expenses, and put 36 cents in the bank or other investments.

On average, for every dollar of donation, KDF spends 62 cents to subsidise patients' treatment, 23 cents on other operating and marketing expenses, and put 14 cents in the bank or other investments.

Isn't it quite obvious who does a better job in utilising the donors' money for the benefit of the intended recepients, ie. the beneficiaries ? By the way, $600K pays for the entire 20 full-time staffs' salary of KDF for 2003.

This may be a very simplistic analysis of their operating efficiency given that the scale of their operation are quite different. But it gives a quick assessment in the absence of more substantial information and model.

The success of any charity is not measured just by the amount of money it can raise, albeit it is one of the critical success factors, but also by how many people benefitted from it and how much of the donations are disbursed to these beneficiaries efficiently and effectively. NKF has demonstrated it is a huge marketing machine judging by the amount of money it is able to raise. I think it is time for them to get back to focusing on what is their mission in the first place.

On a personal note, I will not be making any contributions to NKF until they are more transparent and channel more of the donations toward the intended beneficiaries. While I empathise the plight of kidney patients and would like to help them through donations, I am hesistant to contribute to KDF at the moment. This is because

1. There might be an influx of donations to KDF as a result of this saga.

2. There is already a spike in their donations last year, probably as a result of the publicity of NKF's reserve. KDF's subsidies to patients have dropped to 49 cents and excess fund has increased to 30 cents per donor's dollar. With the expected influx of additional donations, a bigger percentage of the money will go into their reserve unless KDF has bigger plans.

3. I respect KDF's fund raising principle as stated in their website, "Funds are raised based on a pre-determined annual target. This is to ensure that other worthy charities will not be deprived of public funds."

I take heart that in their effort to raise more funds, KDF has not forgotten that they are other worthy charities which are also after the donors dollar.

Until someone can come up with a model to assess these charities, I will use the above simplistic model to determine which other charities are deserving of my donations. While the amount I can afford to donate is small, at least I am assured that the money is going to the people who really need it.


Blogger justice4nkfdonors said...

Excellent comparison and it seriously makes me want to donate to KDF from now on.

6:11 PM  

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