Note: Ci reported program costs from the charity's T3010 filing with the CRA. Ci adjusted total grants in 2022 by contributions payable, affecting total grants by ($57k) in 2022. Ci reported combined administrative and fundraising costs by deducting total program costs, grants, amortization, and interest on loan payable from the charity's total expenses. Ci reported interest on loan payable in other costs. 

Comment added by Loeys-Dietz February 12, 2025:

"  At Loeys-Dietz Syndrome Foundation Canada (LDSFC), we are pioneering a bold and forward-thinking approach to charitable financing. Unlike traditional charities, our model is based on long-term sustainability rather than short-term cash flow. This vision was born, in 2018, from the mind of our co-founder, Joseph Galli, a venture capitalist at heart, who sought to ensure the foundation’s viability in perpetuity. Instead of relying on conventional fundraising, Joseph established an innovative financing strategy centered around accepting life insurance policy donations—making LDSFC the first foundation in Canada to build a significant portfolio of these assets.

To manage this complex and specialized financial model, Joseph also created Pentor Charity Services, a partner organization responsible for originating, triaging, servicing, and tracking the life insurance policies owned by LDSFC. In return, LDSFC provides a fee-for-service to Pentor for these activities, ensuring the policies are properly maintained and their value protected. Furthermore, to cover the premiums and servicing fees associated with these policies, Joseph established a financing model through a limited partner fund that provides loans to support LDSFC’s long-term mission.

We recognize that this model is unconventional, and as a result, traditional charity rating agencies—such as Charity Intelligence—may struggle to evaluate us fairly. Their assessment focuses on short-term liquidity and direct spending on charitable programs, without considering the strategic, long-term nature of our investment model. We are building an endowment designed to create substantial charitable impact in the future. Until these life insurance policies mature, our available cash flow is limited—but our vision is clear, and our commitment to LDS research, education, and patient support remains unwavering.

Addressing Charity Intelligence’s Evaluation

LDSFC fully complies with the Income Tax Act and the Canada Revenue Agency’s (CRA) guidance. While registered charities are required to devote their resources to charitable activities, the CRA explicitly recognizes that charities may hold investments as long as they ultimately serve a charitable purpose. Many organizations manage substantial investment portfolios, incurring necessary costs to maintain and grow them—LDSFC is no different.

 However, unlike traditional investment portfolios composed of liquid assets, our foundation holds life insurance policies, which are by nature long-term and illiquid. The Income Tax Regulations explicitly acknowledge this reality, assigning a nil value to unmatured life insurance policies for the purpose of calculating a charity’s disbursement quota (DQ). This reflects a clear legislative understanding that life insurance donations are a long-term philanthropic strategy and should not require immediate charitable disbursements.

Furthermore, Canadian accounting standards prevent us from reporting the value of our life insurance policies as assets on our financial statements. According to these rules, an asset must meet three criteria: ownership, control, and determinable duration. While LDSFC clearly meets the first two conditions, the third—fixed duration—is not met, as the timeline for realization of these policies is inherently uncertain. As a result, even though these policies represent a substantial financial resource for the foundation, they are not reflected in our financial statements, leading to an incomplete picture of our true financial position.

LDSFC has always met its annual disbursement quota, ensuring compliance with CRA regulations. While our current spending on direct charitable activities is lower than our investment in maintaining our resource portfolio, this will shift over time as policies mature. The magnitude of our existing policies—representing aggregate death benefits of over $75M—demonstrates the substantial future impact LDSFC will have. The costs associated with maintaining these assets are justified by the long-term value they will generate for LDS research, patient care, and awareness initiatives.

Unfortunately, Charity Intelligence’s rating system does not account for the evolving nature of modern charitable financing. The investment world is increasingly shifting toward alternative assets, and charities are following suit. While LDSFC may be an early adopter of this approach, it does not change our fundamental mission: to create a lasting financial foundation that will fund ground-breaking research and support for those affected by Loeys-Dietz syndrome and related heritable aortic disorders.

Moreover, we believe Charity Intelligence’s financial ratios are misleading, as they appear not to account for the full revenue reported on our T3010 filings—particularly the receipted donations of insurance policies. (Charity Intelligence adds that the figures in the T3010 filing are not reconciled with LDSFC's audited financial statements). If their calculations were adjusted to reflect the true financial picture of LDSFC, their evaluation would present a very different narrative.

Looking Ahead

We recognize that our financing model is not easily categorized within traditional charity evaluation frameworks. However, we are focused—investing in a model that will secure lasting impact for the LDS community. Time is our greatest challenge, but our conviction remains strong: we are building something transformational, we will keep growing, and we will get to our Vision: Improving the lives and quality of life of patients and families.