The Foundation

“During the previous year, the Founder became aware of embezzlement allegations. The Founder flew to the inactive office in Mkuranga, Tanzania to investigate. With the assistance of Mr. Shempemba (the head of security) and Mr. Jamal (bajaji driver extraordinaire), an amateur sting operation was initiated to catch the embezzler, Salma Munde (former executive assistant to the Founder). After being caught red-handed in her deception, she admitted her crimes. She was immediately dismissed and all keys and FOUNDATION property was confiscated from her persons. The Founder will strive to never trust anyone again. The most important lesson learned is to only select employees/volunteers who prove themselves worthy of the privilege to be part of THE FOUNDATION. Although completely leaving Tanzania was considered, the Founder decided it would be unfair to those who committed no wrong; therefore, we continue to support neighborhood security in the Ngunguti neighborhood in Mkuranga, Tanzania.”

“The Founder and acting Director of the Board of Trustees prepared form 990 independently. The final version of form 990 was sent to all board members for unofficial review. No official review was or will be conducted.”

“Stakeholders and/or the public were given copies of the relevant documents and/or these documents were made available upon request.”

“AMENDED: The Endowment is a self-sufficient fund(s) that exists as a learning platform for the disadvantaged to empower their financial self-sufficiency. After exhaustive tax law research, it has been decided that part VIII, "Total Revenue" is to be calculated by subtracting the cost basis and sales expenses from the gross proceeds of the securities sales. Financial instruments in this account are actively traded and should not be classified as "investments", nor should the gross proceeds be classified as "gross receipts". For the current tax year, The Endowment received net proceeds of $435,704 from the sale of securities, with $519,985 in mark-to-market costs, resulting in mark-to-market realized losses (total revenues) of $(84,379). Due to the inadequacies of the tax code and/or the online form from form990.org (Civic Leadership Project), we are disallowed from entering a negative revenue number and there is no area within Program Service Revenue where we can enter a cost basis; therefore, zero was entered. The Founder inquired about the Civic Leadership Project's interpretation of the tax code; however, they were dismissive and belittling. CITED SOURCE #1: It is well established in the Code of Federal Regulations (CFR) that certain property and/or asset transactions classified as "gross" are to have the cost basis subtracted from the total transaction proceeds. In section 448, Methods of Accounting in General, it is stated, "With respect to sales of capital assets as defined in section 1221, or sales of property described in 1221 (2) (relating to property used in a trade or business), gross receipts shall be reduced by the taxpayer's adjusted basis in such property." [26 CFR 1.448-1T(f)(2)(iv)] CITED SOURCE #2: In addition, Section 1244 states, "gross receipts from the sales or exchanges of stock or securities shall be taken into account only to the extent of gains therefrom." [26 CFR 1.1244(c)-1(e)(1)(i)(a)]”

“AMENDED: Estimated realized currency losses of $386.”

“AMENDED: This 2022 990 form is being amended to reflect new information, which changes how we interpret the Code of Federal Regulations, Chapter 26, 1.509(a)(3) and related provisions of the regulations. The substantial contribution by the Founder was assumed to be the first of similar annual donations; however, it has become clear through the past couple years that this donation was abnormally unusual in its amount. Furthermore, the inclusion of this contribution in the proscribed support tests would have a severely adverse affect on the status of THE FOUNDATION. Given that The Endowment has always been a related program service activity (actively managed by the Founder, who will always be an unpaid volunteer, as is mandated in the governing documents of THE FOUNDATION), gross proceeds from sales of securities from the actively traded brokerage accounts are no longer defined as "gross receipts". Instead, trading gains (losses) are reported after cost basis considerations. The result is an almost complete elimination of related activity gross receipts ($1.33M to $1,200), and since The Endowment had mark-to-market realized losses of $(99,322), "Other Income" remained unchanged at zero. After all reclassifications and corrections, net assets of the organization was increased by an immaterial 1.2% to $201,808. In Form 990, Part III, Line 4a, some expenses were reclassified. In Form 990, Part III, Line 4c, The Endowment was reclassified and direct gifts were properly recognized as grants. In Form 990, Part III, Line 4, the majority of travel expenses were reclassified under management expenses related to the embezzlement investigation. Miscellaneous Revenue was amended to more properly include currency losses of $386 on Form 990, Part VIII, 11e. In Form 990, Part IX, Line 7, instead of deducting embezzled wages from Wages, they were deducted from retained earnings and included in Other Expenses. In Form 990, Part IX, Line 16, $4,419 in Occupancy Expenses were capitalized and reclassified as Fixed Property Assets (Schedule D was updated to recognize this change). In Schedule A, due to the reclassifications described above, Public Support was reduced from $8,276 to $760. Total Support was reduced from $413,429 to $36,385. In Schedule D, Part V, money reserved for the endowment was moved to another account, but due to an accounting oversight, was improperly classified as negative contributions. In Schedule F, items were better classified and total expenditures were recalculated to include all expenses (including management & general). In Schedule L, the outstanding loan from the Founder was increased by 9% due to previous year adjustments (see form 990 for tax-year 2021) and currency adjustments. In addition to the above changes, we are updating contact information and the mission statement as well as correcting immaterial errors in Form 990, part III, 4b; Form 990, Part IV, Line 11; Form 990, part VII, Section A; and Schedule D, Part VI, 1d.”

“AMENDED (immaterial): Total Security Fees of $6,735 (50% Community Safety=$3,368); Special Assistance to the Founder of $393; Locksmith - $4; Sales - $21; Tailor - $1.”

“AMENDED: $4,419 in taxes and fees were reclassified from Occupancy Expenses to asset adjustments to property.”

“AMENDED: The travel expenses pertaining to the Embezzlement Investigation were reclassified as Management Expenses. Travel Expenses include: Embezzlement Investigation - $7,187; Saving Children - $605; Misc Taxi Services - $49.”

“AMENDED: Proceeds from the sale of securities within The Endowment are no longer classified as 'Gross receipts from related activities' in Schedule A. See previous notes.”

“AMENDED: The Endowment's unrealized trading losses were $(15,321). Realized mark-to-market trading losses were $(84,379). Endowment Dividends and Interest were $69. Miscellaneous adjustments were $4,177. $(15,321) + $(84,379) + $4,177 + $69= $(95,454).”