Wikimedia Foundation Audit Committee/2023-08-03

Audit Committee Meeting

August 3, 2023

10:00 - 11:00 am PDT

17:00 - 18:00 UTC

Remote

Participants: Chair: Tanya Capuano

Regular Members: Lorenzo Losa, Raju Narisetti

Advisors: Michael Snow

Alternates: Mike Peel, Nataliia Tymkiv

Staff: Helen Pang, James Baldwin, Lisa Seitz-Gruwell, Nadee Gunasena, Shelby Langan

Staff Liaison: Jaime Villagomez

Observer: Luis Bitencourt-Emilio

KPMG: Liezl Malabanan, Victory ijegbai

Minutes: Amy Vossbrinck

Absent: Aeryn Palmer, Stephen LaPorte, Julian Singh

Kick off and Approval of June 1, 2023 Minutes

Moved to approve by Raju Narisetti

Seconded by Tanya Capuano

Unanimous Approval

Charity Navigator Rating

Charity Navigator’s most recent published rating has awarded WMF a score of 99% and 4 star rating, the highest rating possible.

KPMG FY 23 Audit Plan Liezl Malabanan, Lead Audit Partner, and Victory Ijegbal, Lead Audit Manager, from KPMG presented the requirements, elements and timeline for the upcoming WMF Audit.

● March - July - Planning and risk assessment

● July - August - Ongoing risk assessment, evaluate controls, perform substantive audit procedures, including examination of journal entries, financial statements and meeting minutes.

● September - October 2023 - Evaluate audit results and present them to the Audit Committee.

The Audit Committee was asked if any members are aware of any significant matters that will impact the audit: violations of laws, fraud, communications, significant acts or relevant information. Each member individually replied “no”. 1 With nearly 200,000 charities rated, Charity Navigator’s comprehensive ratings shine a light on the cost-effectiveness and overall health of a charity’s programs, including measures of stability, efficiency, and sustainability.

Financial Overview - Preliminary and unaudited financial results for FY 22-23 (FY23)

WMF achieved its target financial results for FY23:

● Budget to Actual Variance WMF’s revenue, expenses, and increase in net assets all met the organization’s target variance range of within 5%.

○ Revenue WMF FY23 revenue of $175.4M vs. budget was within our target of within 5%

○ Expenses $167.9M Expenses continued to meet our revised budgetary plan for FY23 and within our original target variance of 0-5%. WMF achieved a -4% variance in expenses.

○ Working Capital Reserve The final FY23 working capital reserve conformed to the Board resolved target and is back to an equivalent of 17 months of expenses. This includes a FY23 net increase in net assets to the reserve of +$7.5M (4% of budget).

● The Programmatic Expense Ratio was greater than the 75% target. Actual was 76%. The Foundation had less programmatic expense than originally budgeted and this variance was more than offset by less G&A expense than originally budgeted, which preserved the programmatic ratio.

FY 23 Year End Accounting Close

The process to provide all the information needed for KPMG to complete the audit on time is in place and proceeding in a timely manner. Close activities are completed and the audit kick off has begun. Work with Communications has begun to enhance the Audit FAQs.

Next Meeting - October 3 ● The results from KPMG’s Year End Audit

● Year to Date FY 23-24 Financial Results (through the period closed prior to the Audit Committee meeting)

● Enterprise Risk Management Update

● Investment Portfolio Progress Update

Respectfully submitted, Amy Vossbrinck