Can I see KDHX's financial statements?

KDHX’s financial reports are made public on our website. Our annual audited financial statements and IRS 990 tax forms from the four prior years are posted. 

There are many ways to determine what success looks like at an organization, financial health being one of the first that comes to mind. We often think of financial health as analogous to financial growth. But there is much more involved in what financial health looks like than whether or not revenue is increasing year over year. 

Since financial health became a particular focus for KDHX when we reached a financial breaking point at KDHX in 2015, we’ve focused on making financial decisions for health and long-term sustainability. It is the fiduciary responsibility of the executive director and board to ensure the organization is financially healthy.

When one compares financial statements year over year, it isn’t always apparent if the organization is increasing in financial health, especially if line items like revenue seemingly decrease over time. There is also much context lost in numbers reporting, which can obscure the full picture.

Let’s analyze, for example, some elements of KDHX’s 2017 and 2022 financial statements that we recently received specific questions about.

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Question: Revenue in 2017 was $1,301,384. Revenue in 2022 was $1,086,648. Why has it decreased?

Answer: In 2017 KDHX was still operating the Folk School, Magnolia Cafe, and The Stage. Each of these programs brought in revenue for KDHX. They each also incurred expenses that were higher than the revenue that they generated. As part of our journey to financial health and stability, decisions were made in 2020 and 2021 to end these programs and focus resources back in radio programming. Read more about KDHX’s financial journey since 2015…

While revenue numbers are less in 2022 than they were in 2017, expenses and liabilities are also significantly less, largely in part to the repayment of debt and refocusing of our resources away from resource-deficient programs. 

In 2017, our total assets were $229,000 less than our total liabilities. In 2022, our total assets outstrip our total liabilities by $391,000, giving much more of an indicator of financial health than our revenue line.

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Question: In 2017, KDHX listed 28 employees on your 990 tax form. In 2022, KDHX listed 8. Why the significant decrease?

Answer: When the total number of individuals employed in the calendar year is calculated, all full-time and part-time employees are included. Throughout 2017, KDHX had 28 people employed, 9 full time employees and 19 part time employees (most of whom worked in the cafe and venue). In 2022 KDHX had no part-time employees and 8 full time employees. The decrease in part time employees is specifically due to KDHX no longer operating the cafe and venue.

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Question: In 2017, total salaries were $553,620, averaging $19,772 per employee. In 2022, total salaries were $561,189, averaging $70,148 per employee. Why the significant increase in average salary per employee?

Answer: As referenced in the previous question, KDHX had 28 employees in 2017. 19 of them were part-time, hourly employees, so the “average salary per employee of $19,772” is skewed compared to 2022 numbers of $70,148 per employee, which only includes full-time employees. 

The total salary numbers referenced above also include all employee benefits and payroll taxes. Employee benefits, especially, have increased significantly in cost since 2017. 

KDHX is proud to have increased the salaries of our staff over the last few years. We believe that an equitable balanced compensation practice supports our long-term health and sustainability. We focus on fairly compensating staff through salaries and benefits that promote the career development, health, and well-being of our employees. We aim to stand as a leader in equitable compensation practices and to align compensation with our values.

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Concern: The percentage of revenue spent on salaries at KDHX has increased from 42.5% in 2017 to 51.6% in 2022, even though there are fewer employees.

Answer: There is no set percentage that nonprofits must spend on compensation versus total revenue. We believe that the proper management of organizational resources, people, things, and ideas is in the best interest of the organization’s long-term health and sustainability. That includes properly compensating our staff with a thriving wage. We center people when making budget decisions.

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Question: In 2017, KDHX listed 1000 volunteers on its 990 tax form and in 2022 only 150 were listed. Why the sharp decrease?

Answer: For many years, KDHX listed the number of the organization’s volunteers as 1000. When new leadership began in 2016, efforts were made to verify and “clean up” data. Financials were the primary focus, so the number of volunteers listed was carried over. Once we cleaned up the volunteer lists and defined “active volunteers,” the numbers were much different. We now only report active volunteers as defined by KDHX on our 990.

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