Charitable Gift Catalogs

Some charities use a gift catalog concept to communicate specific needs to donors. Donors have the opportunity to fund a goat or a cow, buy a month of tutoring for a child, buy a fruit tree, buy a pediatric wheelchair, dig a well or build a new home for a needy family. Gift catalogs that use these types of projects are the basis for temporarily restricted gift revenue.

There are several pertinent issues associated with fundraising via gift catalogs to assure compliance with ECFA’s fundraising standards:

  • Gifts exceeding the need.  A disclaimer statement should explain what will happen if the total amount received for a particular item in the catalog exceeds funding needs for that project. Generally, excess gifts should be used to provide similar assistance to people in different locations or used to meet additional needs in that same project. For example, if more wells are purchased than needed in the course of a year, additional funding will meet other needs of the individuals in the particular programs.
  • Gifts insufficient to meet the need.  A disclaimer statement should explain what will occur if the total amount received for a particular item is insufficient to meet the funding needs for the item.

Example: The giver purchases a “share” in building a home for a needy family. Four shares are required to build the home, and only two shares are donated. The disclaimer might state that if not enough shares are given to cover the full cost of an item through, shares will be pooled with the ministry’s other funding sources to meet the goals of the project.

  • Overhead inclusion in price of gift.  It is common for the “cost” of an item in a gift catalog to include the actual and management (overhead) costs associated with purchasing and/or delivering an item or carrying out the service.

While gift catalogs can be an effective fundraising tool, the concept requires significant monitoring to assure that funds are spent in compliance with the donor’s restrictions.

This text is provided with the understanding that ECFA is not rendering legal, accounting, or other professional advice or service. Professional advice on specific issues should be sought from an accountant, lawyer, or other professional.