Most organisations will receive gifts-in-kind of one type or another. These can include, for example, donations of items to help you achieve your mission or for use at fundraising auctions, free or deeply discounted printing costs or donations of old computers for your staff to use.
It is important to remember that these donations are just as important to your organisation as donations of cash. Some things to consider with gifts-in-kind are:
- Are you recording these gifts against your donors’ records the same way you would a cash donation? Often in-kind donors will also make other contributions to your organisation and being able to see all interactions and contributions in a centralised database is an important way to understand your donors.
- Are you sending acknowledgement letters to these donors thanking them for their in-kind gifts? A donor expects to be thanked for any contributions they make to your organisation. Making sure that donors are thanked is an important way to ensure that they will likely give again when asked in the future.
- Should these acknowledgement letters also contain a receipt? Some in-kind donations are recorded on financial statements and represent a significant contribution on the part of the donor that they may wish to claim on their taxes. Always ensure to consult the ATO to ensure you are adhering to policies regarding receipting.
- Will you record gifts of services as gifts-in-kind or record those contributions as volunteer hours? Some organisations choose to distinguish different types by recording professional services, such as legal or accounting assistance, as gifts-in-kind whilst recording services such as administration and special events as volunteer time.
Ensuring that you have policies and procedures in place to properly record and acknowledge gifts-in-kind will contribute to the success of your organisation by helping to reduce your costs for events, programs and administration.