HOW TO GET ACCREDITATION FOR YOUR PATIENT GROUP FROM
THE PHILIPPINE COUNCIL FOR NGOSs

Ms. Fely Imperial-Soledad,
Executive Director of the Philippine Coundil for NGO
Certification

September 22, 2006
Astoria Plaza
Ortigas Center
Pasig City

(Host Intro: More than just providing a support system for its members and the community, NGOs or non government organizations have come to play and integral role, not just in our country, but globally. Our first speaker has volunteered and headed a number of organizations and foundations in her lifetime, and still continues, I would imagine, to volunteer in many organizations; and in the process, she has come to know just how legitimate recognition enables a group to be more proactive in nation building.

Let’s give a warm applause and welcome to the executive director of the Philippine Council for NGO Certification, Ms. Fely Imperial-Soledad.)

Good morning. Thank you.

I don’t want to stand on that podium, so if you don’t mind, I’ll come to this table, because this is where my prop is, the thing for the power point, and then I think you can see me from there. I want to thank Alice and her group, and I Can Serve, I don’t know if this is I Can Serve Foundation or I Can Serve alone, because this is a serendipitous moment for me. For a while, this is the story of my life, I have been going through some developments in our organization, the Philippine Council for NGO Certification, and then I have been traveling because other countries want to know about our experience and the process and how to put up their own certification mechanism; and since I have just turned 60 years old, I also have this feeling of being lethargic, and tired, and all these hullabaloo about getting old. Now, here came this invitation; so I thought that this was serendipity in that this may give me more energy afterwards.

Imagine being with survivors, I like especially what Alice has said about this is the day that the Lord has made, let us rejoice and be glad in it because every moment counts, so thank you for the invitation, and congratulations, for just being there, beautiful and strong.

My presentation will be from the very basic, which is steps in establishing a non‑stock, non-profit organization, or a non-government organization, and I have handouts there in your kit, which I hope you can also look into as we go along; and then I will bring you to some SEC circular on what foundations really are, because that is the line of least resistance that we follow all the time, putting up a foundation; but there are things that we have to be careful about when it comes to establishing a foundation. Then I will bring you to the context of our organization, the Philippine Council for NGO Certification, and how to apply in case you are interested for certification. I will give you some guidelines on how to prepare so that you can really be certified, okay? Then of course, we end at, I’m not sure about the program here, but it seems there’s another person coming up at 10:30, so I should be sure to end before that.

In your kit, and I don’t have it here on the screen, is a one pager that says “Steps in Establishing a Non-Stock, Non-Profit Corporation or NGO.” Do you see it? Okay. And of course, I put them in bold letters so that you really get to know that, first of all, you have to have at least five incorporators, alright? This is already the step towards legitimacy, but this is only legal legitimacy.

Why five? Well, that is the minimum for the SEC, and therefore, you can also have nine, you can also have fifteen, but I would advise you don’t go beyond fifteen because that would be too cumbersome. We also advise that you get an odd number, not even, just so for decision making, you have at least some tug of war.

So, prepare your articles of incorporation. You have to have some legal mind here, by the way; but, you can register with the SEC by using their express lane. They have a website: http://www.sec.gov.ph will you please note it down, in case you still don’t know. And then, click on their express lane form no. 1 NS, which is for ordinary non‑stock, non-profit.

Now, here is the caveat on foundations. If you want to put up an NGO, and its purpose is not only to grant funds, grant giving, or grant making, so called; meaning that you also intend to operate on the ground, have your own projects, right? Then, PLEASE keep away from the word foundation. Because if you name your organization, the SEC will require a show money of one million pesos (P1,000,000.00) in the bank. So, I’m glad that I Can Serve does not have the word foundation, does it? Does it? I Can Serve Foundation? None, alright. Because if it does not have the word foundation, then the minimum could be only one hundred fifty thousand (P150,000.00) or maybe a little more; we don’t know what SEC has in mind these days, but it won’t go up to one million. That’s the caveat.

Before you begin operating, make sure that you have a certificate of registration, and clearance from your baranggay. Those who have already put up their organization and haven’t obtained that clearance, you’d better. Also secure your mayor’s permit from the city or municipality, and register with your local BIR office for tax-exemption and other purposes.

The tax exempt status will not be given right away. What the BIR will do is give you a temporary status for 3 years, and then afterwards, you will have to reapply for the permanent exemption – permanent means forever, as long as you exist, you will be tax‑exempt. Tax exemption, by the way, means that whatever revenue or income you get, foreign or local, as long as it is being used for your programs; will not be taxed. That’s what tax exemption means. I am emphasizing this definition because you will have to distinguish it from the other benefits, which are the deductibility of donations and the exemption from donor’s tax. So, there are three. There is the tax exemption on your income, and then there is the tax exemption for donors when they give donations to you, if you are certified, and there is the deductibility of donations from the donor’s taxable income if they give to you when you are certified by PCNC. So, there are three.

Related to tax exemption, by the way, is if you do unrelated business income. For example, if you have a business organization that is into renting out space, doing consultancy work, not related to your purposes, then you will have to pay tax on that, the income that you gather from those activities. So, tax exemption only relates to your main purpose.

Then, when you have employees, regular paid employees, make sure that you please register and enroll them with SSS, PhilHealth, and Pag-Ibig; we will go into that in detail.

The next handout that I would like you to put in order in your kit is the SEC Memorandum Circular Number 8. I hope you have it. It defines foundation, remember, it is only for the purpose of extending grants or endowments to support its goals, or to raise funds to accomplish all those that are listed in section 1. And then please note section 2, the one million pesos, and then there are other requirements. The statement of willingness to allow SEC to conduct an audit and they are getting very serious about this, to our chagrin, they will now conduct random audits and they will even ask for the sources and usage of funds and a certificate from your local government unit, even down to the lowest, which is the baranggay, on what activities you have conducted in that area.

They are really getting very serious because there is pressure from above, and what is this? Up there, the US Patriot Act, which is an aftermath of the September 11 attacks; and the United Nation’s Security Council Resolution, which is also related to terrorist threats. So, they are now pressuring even NGOs in the Philippines to comply with this requirement.

Then, all registered foundations, and I am addressing this even to the other members here, who have already put up their own NGOs, must submit the general information sheet annually, with the audited financial statement, which should include a sworn statement of its president and treasurer on the following information: so you have the listed information there, sources and amount of funds, programs and activities, application of funds, and all the rest.

I will not go through this in detail because anyway you can take this home. I just want to underscore the fact that there are requirements now, which even if we have tried to fight this, we have been having dialogues with the SEC, we still have to comply with because of global trends.

The context in which the Philippine Council for NGO Certification was established actually comes from the global context of demands for accountability, transparency, and legitimacy of NGOs. In the world today, there is increased influence of NGOs, and you know that, because NGOs have been recognized as very effective in delivering basic social services and in advocacy work, and in other services for public good. But together with that, there is increased responsibility, of course.

I don’t mean to scandalize you, but I think it is a fact of life that the bolder you are, the higher you go up the pole, the more visible you are, the more your bottom is prominent to the public. And therefore, you cannot afford to throw stones when you are in a glass house, because you yourself will become a target. They will ask you, like we have been asked, NGOs in the Philippines, you are very good at ousting presidents, at advocating for whatever transparency and accountability; but what have you done among yourselves? So, that is the context; and it is not only in the Philippines but around the world.

Now, countering these courses around representativity. Because some NGOs, especially international NGOs and NGO networks even in the Philippines, purport or sometimes even pretend to speak for a constituency. For example, when there is a World Trade Organization summit, or the APEC summit, some NGO networks go, or some international NGOs go and presume to speak for other NGOs. You must have known about that. But their own representativity, or representativeness, or legitimacy as a voice is also questioned. So, that has to be addressed.

Also, preempting questions on public trust and credibility. Because if you have been reading a magazine, a very notorious but very good magazine actually, The Economist, it has launched a lot of attacks against NGOs. Hugo Slim is my favorite writer there because he really says or asks hard questions and it brings you to think about your own existence as a non government organization. So, we have to preempt those questions on public trust and credibility even before something happens.

Then there is a growth of Diaspora and other cross-border philanthropy, which, by the way, you may have access to. Or some of you have already started accessing, in fact. There are a lot of Filipino communities in other countries now, which I would encourage you to access, because there are, of course, a lot of Filipinos abroad, and this is one big source of funds for public good in the country. So because of that, there is a lot of concern about where these funds are going. Sometimes, we get reports. I have been getting reports through email, about certain personalities or groups that have been accessing funds there and yet they don’t even know where these funds are supposed to go.

So they are asking us, if the NGO hasn’t come to us, how could we know? So, the caveat that we tell them there is “Please don’t give, if in doubt. If in doubt, ask; or don’t give.” So, that is one reality. And there is now here, of course, indigenous resource mobilization.

Have you heard about community foundations? That’s a trend here in the Philippines, and even abroad. Big foundations within a certain area; only within a geographical area, where non government organizations, business, government, academe, and other sectors, the private sector, pool their resources, so that they can have an integrated development framework and integrated plan of activities. Isn’t it more effective that way? While here we are, doing our thing, wherever we please, and so far, there hasn’t been any apparent result. For years and years we have been doing this. So, maybe this is the answer. But we need indigenous donors, and therefore this is the point of local philanthropy and advocacy for benefits for NGOs. So, if we want to have more benefits for NGOs, then we have to become transparent and accountable, and the global trend towards good governance and accountability, which we cannot resist.

In the local context, there has been an increasing involvement of NGOs; even in the global context still, greater openness to NGOs involvement brings more responsibility. Important organizations now adhere to promoting and enabling environment. So, even the World Bank and some funding agencies that are based abroad are coming to us, asking us, PCNC, to please help them assess their proponents and their grantees. That’s why we have now a partnership with the World Bank for learning events and evaluation of NGOs that are out there in the outskirts that have not even heard of PCNC. The rapid growth and higher visibility of civil society organizations have raised questions, which I have already explained. Ah, the Philippine context.

You know there have been recent attacks on foundations. You have either read about them or heard them, or saw them on TV, di ba? Right. I will not go into details but I know you have the names here in your heads.

The recent position of SEC on corporate governance and the new guidelines on foundations, that’s the context that I went into earlier. The passing of the anti money laundering act, which is now a law, and therefore maybe just a little bit on that; don’t be scared, or don’t be anxious if you have more than P500,000.00 in the bank. Then somebody asks you, from the bank or from some other source, and you don’t even know who, where that money came from, or where it is going. Because the banks now, and actually it is the whole system now up there, have a way of monitoring fund movements of P500,000.00 and above. So, anytime somebody might call you and ask you where did this money come from and where is it going. It is a dangerous world now, and therefore we live in a very suspicious society.

There is the general hysteria after the 9-11 and then, there are dwindling foreign funds and assistance here. The Ford Foundation has closed shop here. The USAID doesn’t want to give to civil society organizations anymore in the Philippines. And there is a rumor, I don’t know how true, that we have become least interesting, the Philippines. They are now going into Europe and the newly democratized countries, the new economies, and therefore we are losing foreign support.

This is the context in which we have founded PCNC. We want to promote local philanthropy but we have to give higher tax incentives to donors. The problem was they were going to take away this incentive in 1995. The comprehensive tax reform program was drafted and government wanted to take away the donee institution status of NGOs, where if you remember, some of you, if you are that old, you’re as old as me; before, when you were given the tax exempt status, you were also given the benefit of allowing your donors to deduct their donations, and also donors to be exempt from donor’s tax. But they were going to take that away. So, we lobbied with the government. I was then the Executive Director of the Association of Foundations. So, we lobbied with the government and we were challenged. If you want to retain the Donee Institution Status, please note the three word term. This is now not tax exemption, but Donee Institution Status, as against donor.

The local taxpayer’s donation, whether in cash, personal property or real property, to a qualified organization, that means PCNC certified and BIR registered, because we endorse to the BIR, can be deducted from the donor’s taxable income, full or limited. Full, I can safely say if it is for example for your cause, then the donor can deduct it fully. But if it is for research, academic, scientific, or religious purposes, it can only be limited deductibility. And if it is limited deductibility, 10% can be deducted by the individual donor and 5% if it is a corporate donor. I hope it is clear. Please just tell me if you want to ask a question. And as I have said, it is also exempt from donor’s tax.

Individual donors. There are two kinds of donors. The corporation or the individual. The individual must be engaged in a trade or a profession. A salaried worker cannot deduct. Of course, he or she can donate, but he or she cannot deduct, why? Because already, the tax is withheld, when he or she gets the salary, therefore there can be no business expense to be deducted. But the individual can also be a family, which has a corporation, and therefore it is actually the corporation that gives the donation. So, when you say individual, please define what individual means. Is it a person? Or is it a family that has a corporation? Because it is better that it is the corporation or that individual can get a 10% deduction then it is to that advantage.

The challenge was for us to put up this NGO mechanism to determine which among these 150,000 or so NGOs in the Philippines deserve the Donee Institution Status. Because admittedly, there have been a lot of abuses by NGOs and non-stock, non-profits, right? We have to admit that. And so, we took up the challenge and put up the PCNC. We conceded and six large national NGO networks founded the council, and I was tasked to set up the office, the systems and procedures, and in January 1998, after the DOF, BIR, or government for that matter, saw that we were really serious, we signed a memorandum of agreement with the DOF and in December, we had the implementing rules and regulations or what we called the Revenue Regulations 13-98.

So, who may be considered for Donee Institution Status? Please find yourself here. It can be an NGO, or a non-stock, non-profit domestic corporation; not a foreign based NGO. And it could be for the following purposes: religious, charitable, scientific, youth and sports development, cultural, educational, social welfare, and rehabilitation of veterans. Where would you fall? Charitable? But you know what? Charitable is a very vague term. Social welfare is usually for children and women and depressed families. So, if you think that cancer survivors are women who need help, then they can be; but social welfare, though, usually spells out resident facilities, especially for children and elderly, you know. But I think you can well fall under charitable or social welfare if you have community development, so that’s safe, and you get full deductibility of donations for your donor.

Then civically or social organization, not organized for profit but operated exclusively for the promotion of social welfare. So, the Makati Rotary Club, for example, has been certified, but there are other Rotary Clubs, which we have not certified, either because they haven’t applied or because if they come to us, then we find out that they only serve their own members, it’s just a social club. But there are other Rotary Clubs that do civic projects and community development. Then non-stock, non-profit educational institution also falls within our mandate.

What are the characteristics of these NGOs and non-stock, non-profits? Ah, very important now. No part of the net income or asset should belong to or inure to the benefit of any member, organizer, officer, or any specific person. Right? Because of course, logically, you put up a foundation to serve others, not to serve yourself. The members of the board do not receive remuneration, because they are there on a voluntary basis. But of course, if the…this is a very ticklish issue. Sticky. Sticky. If a board member serves as a resource person and it is an income generating activity, he or she can get an honorarium, but it should be noted down that he or she is not getting compensation for board service but as consultant or resource person. But again, I say that’s sticky because it crosses the line somehow and there may be apparent, even if not real conflict of interest. So be very careful about that. You should utilize your resources directly for the active conduct of your activities as declared in your purposes. As declared.

The level of administrative expenses on an annual basis should not exceed 30% of the total expenses and of the total donations received for the taxable year. Why? Again, because if you are soliciting donors; now I will segue into that mode: the mode that you want to raise funds from local or foreign donors; and the philosophy is a donor would give for programs or projects, not for salaries, not for overhead, and therefore this is the caveat on the admin and program expenses.

Then there must be a provision in your articles that in the event of dissolution, the asset shall be distributed to another certified NGO organized for similar purposes. So, if I may contextualize this: if you intend or you decide to dissolve your NGO, then there must be a caveat there in your articles that it will also be given to an NGO or non-stock, non-profit that serves cancer survivors or promotes the welfare of cancer survivors.

There is the certification process, which is also in your kit; but I will flash this anyway. If you want to apply, you will please either email us, fax us, mail/post a letter, but we will send you two forms, letter of intent and application form. And then, sorry, we charge. We charge an application fee because we are a private entity, we are not a government entity and we have to survive ourselves.

Once you have complied with those, we send you a survey form, which is really a profile of your organization. Sorry, it is not in this but it is actually easier there. And then, you fill that up in four sets, I will explain why, and you pay the balance of the application fee. If your total assets are less than five million, you pay ten thousand pesos (P10,000.00). If it is five million and above, it is there, no? I hope I am saying it right. Fifteen, no, five million to fifteen million, then fifteen thousand (P15,000.00). More than fifteen million, then you pay twenty thousand (P20,000.00). This covers the evaluation cost, meaning, we send a team of two or three, wherever you are in the country, we pay for transportation and accommodation, it’s not like PAASCO.

Cecil and I have been in PAASCO surveys and we know that the school has to subsidize transportation, accommodation, and all expenses of eight members of a team. We send a team of two or three and PCNC already pays from the evaluation costs. So, the organization is not expected to put out more cash for that evaluation. And then, we visit, it’s really like PAASCO, Cecil, Chita helped me put up the system anyway.

We form the team of two or three, only very minimal. Then, we conduct the visit, also two or three, ah, two days, or one day, if it is a very small organization, and then we submit the findings to the board, which meets monthly, and it is the board that decides whether to certify or not. Sorry, folks, I’m just the messenger. The board, which is an eleven member board, which includes a BIR representative, meets monthly. And whether or not the organization is certified, ah by the way, if it is certified, it is endorsed to the BIR, and if it is not, or whether it is certified or not, the applicant is informed with a lot of recommendations. So, it’s really like consultancy, but very cheap consultancy.

When we grant the certification, it could be for one year, if it is newly established, meaning it has just one year of operation, but it has to complete one year of operation. And then three years if it is so-so; meaning there is a rating scale. So, if the organization has obtained a rating of, in a scale of 5 to 1, a rating of 3 to 4, it gets three years. And then if gets more than 4, it gets four years certification. And then we revisit. They have to reapply and we revisit. Along the way, we hope that the organization is helped to strengthen further, develop further.

There are steps and requirements in the application, which I want you to just go through on your own; maybe even do a self assessment. First, from the steps of establishing: are we established now? Ah, you’re not really established until you have done seven steps on the first page that we looked at. Then, when you are established, have we operated for one year now? You will know that you have operated for one year if you have an audited financial statement, and then a GIS – general information sheet submitted to the SEC.

Then, are we ready to apply now? Look at the sheet number 5 - Steps and requirements in the application. So you have here, wow, two columns. For NGOs operating for two years or more and then for newly established NGOs operating for at least one year. So, I advise that you just bring this home and assess if you have these documents.

I will give you a peek into some of the questions that you will have to use for your own self assessment also. In PAASCO, Cecil and I have been privy to the system that they have to do self survey and then rate themselves and then tell PAASCO: “We’re ready now.” But we don’t have to do that. We want to expedite the process. So, we only give this to the applicant organization so that they themselves can say: “Alright, we lack this; we have to do this before the visit and all.”

There are some questions here, which I will go through very fast, and then, the next pages, the next sheets, if you please look, we don’t have to go through these now, but you may skim over these while I’m still here, then you can ask me later: “What does this mean? What do we have to do?” I would like to guide you, walk you through the questions for self assessment. Do you have that sheet now? Ah, important point for fully operating applicant organizations. Yes? Okay.

Number one. Are the purposes clear? Why did you put up this organization? Of course, very clear, within this group, di ba? Very focused.

The needs being responded to. That’s number two. Very focused.

Three. The board staff and beneficiaries understand. I think you will have no problem with numbers one, two, and three, because you have a definite purpose in mind, di ba? I am presuming, ha?

Then number four. Ah, here is where we may have a problem. Are the board members actively involved in policy formulation and direction setting? As evidenced by what? So, do they meet? Then, do they have minutes? Because that’s the evidence.

Number five. Also answers that. Are there resolutions? Board actions? Decisions? Especially when it comes to the funds. They must be properly filed and numbered.

Number six. Is there evident or possible conflict of interest? How? For example, the board officers are family members or board members are also implementing. So, there is no oversight function; because the board is supposed to be the governing body, and therefore it must oversee the implementation. There had been organizations that have been deferred or denied because of this.

Seven. Board members receiving remunerations, ah, better not.

Then clear processes for board selection and election. I would advise that since you have the SEC articles proforma, they have a template online. I would advise that after a few months, you move towards amendment, amending the articles of incorporation and bylaws, already contextualizing the provisions within the practice or practices that you think suit your own organization. And please be very clear about your selection and election process. We do not specify term limits, but terms of office must be clear. Now in the template, it is very vague, so make is clear, among your board members.

And then, number nine. Are you doing according to your articles and by-laws? Because that is your Bible. So, please follow your Bible.

And then: Is there a clear organizational structure? And lines of accountability? Because we want to know has authority, who has responsibility, who is accountable for what? And to whom?

And then, are there clearly defined functions and personnel policies? They must be written. Why? You know what? I have just come to realize this in my old age. They have to be written because you cannot stay there forever and those who follow must have something to guide them. Therefore, please be kind to the successors and have all these procedures written. Are there enough staff? We don’t care if they are volunteers, or if they are seconded by another organization, as long as there are warm bodies to perform the task.

Does the organization pay its staff? If they are regular and permanent, the law mandated wages and benefits. Minimum wage, SSS, Pag-Ibig, and PhilHealth. Why? Because again, we go by certain values and principles, di ba? And yet, if we are not able to practice what we preach – values, principles, humanity, humaneness, what are we standing for? So, that is the contradiction sometimes in practice and preaching.

Clear operating system? Of course, I hope that even if it is a very simple operating system, whoever comes into your organization, this is what follows that.

Then, is there a clear planning process? Sometimes it is only one person who carries the plan in his or her head. So, what if he or she is incapacitated or dies or what? You know, there must be a planning process within the board, within the staff and the board, ideally.

Monitoring and evaluation system. No matter how simple, just so you know that you have achieve your objectives. Just so you know that you are in the right direction, even very simple system.

Funds resources utilized according to the purposes. Ah, very important, because the donor will no longer give, or will even report you to the authorities if you misuse the funds; and it is a violation of donor’s trust.

Ang problema pala natin is pagnasunog ang isa, sunog tayong lahat. So, it is also kindness to the whole NGO community.

Proper documentation of financial and project transactions. Very important. Therefore, please do not be too conscious of wasting paper if it means really documenting your transactions.

Adequate internal control processes. May I just go through these? Because these have to with financials and this is our commitment to BIR and DOF.

Transparency and accountability along books of accounts. They must be registered with the BIR.

Bank account must be in the name of the organization, because when you first establish, you can put the money in trust, but make sure you move already to the account name of the organization.

Receipts must be registered with the BIR and properly used. It means updated. Hinde na may receipts, hinde naman ginagamit.

Pre-numbered check vouchers are ideal and at least two check signatories. Why? Again, for internal control.

And then separate persons for disbursements, approval, for bookkeeping and cash custodianship. Why? Because you have to have check and balance.

Supporting documents of financial transactions properly maintained for audit. An annual audit, please look, should be made by an independent, sorry, please put down CPA, registered CPA ‘yan, ha? With the take out SEC, because that may not be applicable to you. At least, BIR, PRC, and accredited by BOA, ok? SEC may not be necessary.

Please write out your accounting and financial policies and procedures, then remember administrative expenses not to exceed 30%. And do you have sustainability plan? Because we cannot certify you and then next month you are already closing shop.

What are your linkages? BOA is Board of Accountants.

Okay, I will stop there so that you have, I don’t know if there is time for questions and answers. So, anyway, those are the handouts.

Meryll: Thank you, Fely. The floor is now open for questions for the next half hour, thank you. I’ll just start something. I remember yesterday there was one group that was speaking about not being organized yet because of the issue of the one million peso, who was it? Are they here? Yeah? Everybody.

Thank you, Fely, because this information you gave us is so important.

Fely: Please don’t tell SEC I told you.

Meryll: No, no, no, no, no. Our lips are sealed. Does anybody have any other questions that you want to bring up?

It was you, yes, yes.

Audience: I think we have to be faulted for naivetÈ. We didn’t know any of what we were getting into. What we know is that we wanted to become a foundation because whenever we would ask for donations, we would be told: Are you a foundation? And we would say: No, we’re not. And they say, come back when you’re a foundation, because we cannot use our donation as a tax shield.

And so you know, without knowing anything, and since I was the first curator and director of the Negros Museum, which I have put up, we incorporated and we applied for foundation status and then, the qualifying amount was fifty thousand.

So, working on that outdated information, I told my friends, I said: “All we need to do is raise fifty thousand.” So, we worked very hard, and we raised fifty, and I went to SEC, and they told me: “Come back when you have one hundred thousand because it has just been raised to a hundred thousand.”

So, I went back to them and said: “Let’s work harder because we need one hundred thousand.” So we worked again. And when we had one hundred thousand, I went back there and I said: “Look, we have it in the bank. We have one hundred thousand.” And they said: “Come back when you have one million, because we have just raised the ante, because they said politicians are using the foundation as a front to money launder.”

And I said: “That is such an unfair policy because real NGOs have a very tough time raising a million, but that is the sort of money that comes very easily to politicians.” So I said: “You’re marginalizing the wrong group of people.”

And so at around this time, I attended a conference of NGOs and we were all talking about writing a position paper, because we felt we were being marginalized, but nothing really came out of it.

So now that you have given us all these, we realized that we’ll be running a gauntlet. I mean, good God, all these requirements. I mean, we thought we would just, you know, because the only way we thought we could raise the money was solicit funds and maybe run, you know, because we have this fun run. It was the only way I could think of raising money fast. And we were all saying: “Oh, that’s okay; we’ll run for as long as it will take.” But now that you have shown us the requirements, it will take more than running to qualify. Thank you.

Fely: Sorry about that. We also had a dialogue about the foundation thing. This was really recent, fairly recent, and then they said: “Because we looked at your materials, PCNC materials, it doesn’t define foundation.” And so we looked at the US and the European model, and foundation there means grant giving, which is not true, by the way. And so they say now: “We will only register foundations if they give out grants.” And that’s the principle involved. But please don’t use the word tax-shield, because that’s an anathema to some anyway. You might get into trouble. So, now we know. Don’t use the word foundation.

END OF DISC 1, day 2 – Missing minutes

…thing called rehabilitation for veterans? Why is there, why was that particular niche established? Because I’m…I mean.

Fely: I don’t know. It’s in the tax code, I’m sorry. It’s in the tax code. So they just put all these types of activities or types of organizations within the PCNC’s mandate because you know what? By the way, there are hundreds of types of non-stock, non‑profits, which are like tax exempt also, like cemetery companies, mortuary assistance, associations, village associations; but they do not fall within our mandate.

Audience: I have a second. It’s more really a comment. The guidelines that you raised earlier, I’m very overwhelmed. You know, we are small, I mean, a cancer support group start small. I can’t even imagine that I have a million, or much less even 500,000, or even 200,000. We normally just simply start small. The way kasi it comes across to me, is that, wow, I can understand it because my mother applied for it more in the context of a veteran’s foundation, but they’re already huge. When they applied, they had a 120 million, and the reason they applied was basically, I mean this is organized by, their board of directors are people of impeccable credentials. You have Ramos, President Ramos there, kaya naman talagang they would definitely qualify. Now, kami we don’t have something like that, okay?

Second, I was wondering, if you were to put up a corporation, it’s like I’m going to put up a corporation and it’s huge, no? But don’t you have something like a single proprietorship, yung something like a small and medium scale, some gradation or something, or some levels to make it naman more manageable for us? Kasi parang, baka you have tier, correct, or something, or something you might want to consider later on.

Fely: I’m not speaking for SEC, ha?

Audience: So, it’s the SEC that puts those in?

Fely: It’s really SEC, because you register with SEC, even before you come to us. So, I’m not representative of government or SEC, I’m sorry.

Audience: Okay..

Fely: That’s why I’m giving you the leeway, meaning the escape route that if you intend to register, don’t use the word foundation, and then in your purposes, do not put down only the purpose of giving out grants, because that’s where they will really ask for the one million. So, that’s why I said I Can Serve, Incorporated; that’s safe. They will ask you for 150,000.00, I think.

Audience: Incorporated?

Fely: Yes. Not, not, no word “foundation.” It’s really crazy, I’m sorry, but the only way out; but you know what? We fought this out with SEC, we had how many, we had a series of dialogues and that was one, the one I was just describing; that they were saying: you don’t have the word “foundation,” you didn’t define it. So we looked at the US and the European model, and there is only grant giving; and we said: “No. It’s not true. We have been to the US and Europe. We know that they are also operating on the ground.” But they said: “But what’s what we find in their literature.”

Okay. And then we said: “Here in the Philippines, foundations are also operating on the ground. In fact, there are more program operations for foundations than grant giving.” Isn’t it?

Audience: Yes, that’s true.

Fely: But they wouldn’t buy that. So, sorry, we could not, no? So, we’ll just have to go the other way – do not use the word foundation. If you can only change your name, then change your name.

Audience: It’s the SEC whose mindset you should change!

Fely: So, so, we have been having advocacy there, but as of now, all I get, actually I got about three letters in reply to my requests and it’s SEC. Sorry, this is it.

Audience: Good morning, ma’am. This is also in relation to what she has discussed, no? We are also a small organization and most of my members are indigents. In fact, they are usually the balut vendors, selling fish, like that, so, it’s really hard to group and organize, especially the legal parts. So, my question now is: If I’m going back there, how would I explain to them, especially on the financial side; so, kasi we will still start the funding. So, paano man kami mag start at yung basic lang ba na ipa attend ko sila. Kasi iba ang level sa members ko, e. Hinde pareho sa atin, ba. So, it’s really hard to explain especially now that we have to raise money and how much really should we start to raise that funds. Thank you.

Fely: So, going very practical, since you have a series of meetings already, di ba? Nag meeting na kayo, no? From where are you, if I may ask? Cebu. So, pwedeng magbinisaya ‘ta, although there are Tagalogs here. So, you have had your meetings already, and then, you start from the very first sheet, kani, no? And then, you ask if there are five of your members…you are not yet registered with SEC, are you? O. You ask if they are willing to make this a corporation. Corporation, please do not be scared about that because a non-stock, non-profit, meaning NGO can also be called corporation; because, you have to explain to them, we want to raise funds; and people do not just give funds or money if we are not organized. Kay, magbinisaya ko, kinsa ma’y ilahang gukdun ug mawala ang kwarta, no? So, whom will they run after if the funds are misused, di ba? That means there should be an organization that will be accountable legally. So, you will really have to explain that, and then go through those steps. Dali ra man ni nga steps. Actually, these are the easiest steps. By the way, being certified by PCNC is optional, ha? You don’t have to come to us if you are not ready; but if you want to go big, get local donors, corporations, they will really ask you for PCNC certification. Pero, otherwise, you don’t have to come to us.

Financial side? Asa dapit sa financial side? Pag start? Ah, sa SEC? O, prepare 150,000.00; pangutang sa mo.

(inaudible audience reaction)

Cecil, may I give this to Cecil?

Audience: Just the papers alone that they will give you, which is this thick, they ask you 500 pesos for that.

Fely: Documentation.

Audience: Yeah, the documentation. It’s this thick. Yeah. And you have to pay 500 pesos.

Background audience: For the form! The form!

Fely: The form lang yan. The form.

Audience: But don’t list…

Fely: Don’t forget. Please, nia pa, nia pa. Please. This is for you also.

Audience 1: Because Petals of Hope, I registered Petals of Hope for only five thousand.

Audience 2: See?

Fely: Where?

Audience 1: SEC. Kahit na ngayon. Even ngayon. Kaya lang it will be…kasi parang association, e. There is a ano roon sila policies na merong nakalagay na donations, we can, for the start.

(Inaudible reaction)

Audience 1: Yeah, there is. Parang sort of, dun sa ano ng…

(Inaudible reaction)

Audience 1: Ah, Alabang.

Fely: Alabang.

Audience 1: Yes.

Fely: So, you went to SEC at Alabang

Audience 1: Yes.

Fely: …and sa Ortigas.

Audience 1: Yes. I have a friend there, a lawyer.

Fely: Alright. I know you can give the recommendation…

Audience 1: Yeah, I can.

Fely: …but, she is in Cebu, e. She is going to SEC Cebu.

Audience 1: They will guide you. They will guide you.

Audience 2: Excuse me po.

Audience 1: Yes.

Audience 2: Kami po, ang Bataan Cancer Society po, nag pa register po kami sa SEC, nagastos ko lang po is 700 pesos, last July.

Fely: Hinde kayo hinapan nung capital fund?

Audience 2: Hinde po, Bataan Cancer Society and Support Group, Inc. May I, N, C po kami.

Fely: O, walang foundation, ha?

Audience 2: Wala po.

Fely: Walang foundation.

Audience 2: 700 pesos lang po.

Fely: Tapos, wala pa kayong bank account?

Audience 2: Wala po. Basta hiningan lang po kami…

Fely: Hinde kayo hinanapan.

Audience 2: …yung every member nang 100 pesos donation or even 50 pesos, inaccept po nila.

Fely: Okay. Ano yung purposes ninyo? Ano nilagay nyong purposes?

Audience 2: Para po sa lahat ng mga cancer patient ng buong Bataan.

Fely: All right. So, maybe you can follow that example. You’ll never know, ha? Some of them may be already enlightened. Okay, the last thing I knew was ano e, capital fund.

Meryll: We do always remember that the battle we waged to fight our cancer, okay, was a tremendous battle. The paperwork is a piece of cake compared to that. Don’t forget it. Now, you start one way, you start small, okay. Because you need that, you need to really solidify your group, and then you will want, like I say, to take it to another level, and that’s where Fely’s assistance was so helpful. That’s where it moves on to; because as you grow your group, your purposes do expand, and you need that…you know, eventually, you will need that certification when you want to go, okay, to the Gokongweis and the Ayalas, and whatever to get whatever funding that’s available there. You will need that eventually, but everything starts, okay, with the first step, and always keep in mind, the battle for your life was a, you know, heck of a battle. Paperwork is easy.

Are there anymore questions? Yes!

Kara: Do you have guidelines for accounting? Because I know there are certain categories just meant for NGOs, our type.

Fely: Ah, we held consultation, a national consultation two years ago on accounting for NGOs and this came out in the, how is this, auspices, I would say, or under the House of the Asia Pacific Philanthropy Consortium. So, we are still waiting for the approval of the International Accounting Standards Board; because this is international na e but we have a draft accounting guide, which is not yet safe to use because it’s still a draft; but it is a very good guide.

I would say simply for now, you can just use the generally accepted accounting principles.

Kara: Okay.

Fely: There are simple and generally accepted accounting principles and I think they go across the board. They do not have to just be explicitly for NGOs.

Kara: Do you also have small groups of our kind who eventually join the Philippine Council of NGOs? Kasi, to people like us, well, just a backgrounder, in all our groups, we don’t have paid staff, we hardly have a structure, people die…

Fely: You have volunteers?

Kara: …people die. The lifespan of the members and the leaders are not that long and everybody has a job, so no one is really full time. All we really have is a burning passion, and then as we do it, we get louder. But do you think we should aspire to be that big and, you know, be a member of the Philippine Council of NGOs; would it be very be beneficial for us? Or just be content with the status of a non-stock, non-profit and continue operating like that? Have you experiences where a small group joined your league and it’s really big time?

Fely: There are small, simple NGOs that have been certified and it’s very easy to evaluate them because they are very simple, like one scholarship program, that’s all. So, how transparent can you be? Very simple. But my suggestion as to your next question was, why don’t you make yourselves strong enough even as a simple organization first, okay? And then I would advise that you kind of integrate, have a consortium of sorts or federate, and then let that bigger organization be certified or get some funding to farm out to the small NGOs. If you want to go big with funds, better as a network or a consortium of sorts if you cannot afford to be stronger or bigger than what you really are now. There is, I think there is value to being federated.

Kara: Last question, sorry. If you want to join the Philippine Council of NGOs, like the I Can Serve is not a member but wishes to be one, and you know, there’s so many mistakes in the past that when you see it: “Ay, naku! Wag natin ito tanggapin, they didn’t do it correctly!” But because we are really amateur about it, like everyone in the room, we started with good intentions without knowing there’s this…there was ignorance of the law, so will that be a point against these groups when we apply eventually and we did everything wrong?

Fely: Did.

Kara: Is there a second chance?

Fely: You said past tense, ha? Did everything wrong.

Kara: Yeah, because of the ignorance of the law.

Fely: But hopefully rectified…

Kara: Yeah.

Fely: …along the way.

Kara: Will you be giving leeway?

Fely: Right. We put a premium on the ability to rectify mistakes, meaning we admire learning organizations. Organizations which are honest about what they have done, even if they were mistakes, and then were willing to correct those mistakes. Because those are the organizations that will eventually become stronger. They have learned from their mistakes. Yeah.

Kara: So, don’t forget our name when we apply. I’ll give you a list of everybody’s names here.

Fely: If you did commit mistakes, make sure you rectify them. I’ll give you one very brief example lang, ha? There was one which we had certified and then did one big mistake, and they applied for renewal. Of course we did not certify them right away but we said: “You please rectify that mistake.”

They came to me personally. We had a meeting. I was the one whom they met with, not my board. So, it was good like that, then I shielded them from the decision making body, and then I said I will even pretend that I did not hear about this; but I admire for coming to me and confessing right then and there because they knew if we went there, we would smell something fishy. So, they did the right thing, and we admire them for that, as long as they don’t do it again, ha?

Kara: Thank you.

Meryll: This will be the last question because we have…oh, yes?

Audience: This is just a comment or just a suggestion. Our group needs a stronger lobby because we need a lot of things that the government can give us and I see I Can Serve as a potential lobby group. But as you said, we need to federate so we can be accredited. I think, ah, when are we going the start? If the gay group has Ladlad and just came out, I think I Can Serve can be a very, very potent lobby group for us in the future, I hope we do something.

Meryll: Well, how about a big round of applause for Fely? Thank you very much for all the information and for opening doors for us.