4 Tips For Operating Abroad

You’ve planned and overseas vacation. In that time between planning and traveling, you might need to acquire appropriate documentation such as a passport, notify your bank about impending overseas charges or exchange some currency, and clear some technological barriers such as ensuring the availability of wi-fi and purchasing a new charger for foreign outlets.

Nonprofit management in foreign countries can include a similar set of steps. Though nonprofits are often best known for helping those in their community, broad issues such as food insecurity, disease eradication, clean water, and the environment may necessitate activities all around the world.

    Curtis Saueressig, senior manager, and Timothy Stiles, partner — both of KPMG LLP — provided some of the basic considerations to working on foreign soil during their session “Operating Abroad – Risks and Reporting” during a recent American Institute of Certified Public Accountants (AICPA) Not-For-Profit Industry Conference in National Harbor, Md. Tips provided during the presentation included:

  • Starting out. Think about what you want to accomplish with your organization’s overseas activities and what sort of presence you might want to have their in terms of an entity. That might include establishing a branch office, association, foundation, trust, or LLC. Consider local regulations, tax law, fundraising opportunities, and flexibility in terms of delivering programming when deciding how to to establish the organization;
  • Get up and running. Identify necessary registration and potential related advisors. Compliance considerations could include banking, tax, human resources, real estate, and reporting requirements. The Internal Revenue Service’s Form 990, Schedule F is among the related tax and regulatory components that come with foreign activity. The form requires disclosure of the region of the activity; program, fundraising, and other activities taking place; and the extent of the organization’s physical presence in the region;
  • Ongoing risk management. Potential issues lurk in programming, finances, security, health and safety, and facilities — among other areas. A best practice would be to conduct updates on nonprofit compliance considerations in countries of operation every six months, evaluations of updates related to banking, human resources, grants, and other operational facets once per year, and periodic deeper dives into the above-described areas; and,
  • Exiting gracefully. If your organization’s time in a particular country comes to an end several steps might ensue. These include determining whether it is better to close offices or leave them dormant, legal and accounting requirements for closing shop, if and when records can be taken out of the country, and how much notice to give to staff.