PETA survives IRS audit

From ANIMAL PEOPLE, July/August 2005:

NORFOLK–The Internal Revenue Service announced on May 16
that a 20-month audit of PETA and the subsidiary Foundation to
Support Animal Protection found no reason to revoke their tax-exempt
FSAP holds two-thirds of the assets under PETA control
according to IRS Form 990, including 75% of the cash and securities.
FSAP in recent years has paid the mortgage on the PETA
headquarters, has leased the site to PETA, and has done direct mail
fundraising on behalf of PETA. This has enabled PETA to avoid
declaring the full extent and nature of PETA assets and spending on
IRS Form 990.
PETA claimed in fiscal 2003, for example, that only 14% of
its expenditures were for fundraising and administration, but if
FSAP and PETA were seen as a single fundraising unit, counting the
cost of all mailings with fundraising appeals as fundraising expense,
following the Wise Giving Alliance accounting standard, actual
fundraising and administrative expense came to 50% of budget.

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