If your organization received an audit or review from an outside accounting firm, staff salaries should be allocated based on the functional groupings listed in your audit.
If your organization did not receive an audit or a review, you have the discretion to allocate their expenses based on the type of work they did during the year. For example, let’s say your executive director spent 40% of their time on programming, 25% of their time fundraising, and the remaining 35% of their time on administrative tasks. The salary would be allocated accordingly:
- 40% of their salary and benefits would be entered in Personnel Expenses in the Program column, on the appropriate lines.
- 25% of their salary and benefits would be entered in Personnel Expenses in the the Fundraising column, on the appropriate lines.
- 35% of their salary and benefits would be entered in Personnel Expenses in the General & Administrative column, on the appropriate lines.
If your organization paid payroll taxes on their salary, and the executive director received a W-2, the salary should be reported on the Employee Salaries, Benefits, & Payroll Taxes line in the Personnel Expenses section.
If your organization did not pay payroll taxes on their wages (and provided them with an IRS Form 1099), their wages should be listed on the Independent Contractors line.
For more information on functional expenses, please see:
How should I enter functional expenses in the Data Profile? (Unaudited organization)How should I enter functional expenses in the Data Profile? (Audited organization)
