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Friday, 10 June 2011

A Close Look at Baba Ramdev’s Finances

Baba Ramdev's bid to provide transparency about his charitable organizations' financial statements fell short of its goal.

On Thursday evening, Baba Ramdev released financial statements for four of his charitable organizations. These include his oldest trust Divya Yog Mandir, as well as the trusts Patanjali Yogpeeth, Bharat Svabhiman, and the Acharyakul Shiksha Sansthan.

However, the information shared for most of these organizations wasn’t really enough to give the public a full picture of their financial income and expenditure.

In the case of Divya Yog Mandir, only its balance sheet is shown—and not statements on cash flows that would provide more clarity. According to the balance sheet for the financial year ending March 31, 2010, the most recent data posted, the trust had total assets of around 2.5 billion rupees ($56 million). The trust has around 73 million rupees ($1.6 million) in cash and in the bank. There are no details about the sources of funding for the trust, or how its money was spent or invested in the year.

Of course, many charities in India don't have a legal obligation to share their financial statements with the public, although most of them do have to file an income tax return.

Anil Verma, an external auditor for Baba Ramdev's charities, said in an interview on Friday that the laws of Uttarakhand and U.P., where the charities are registered, don't require charities to publicly disclose their accounts. So, Thursday's disclosures are an act of goodwill by Baba Ramdev, said Mr. Verma.

However, experts in the nonprofit field say that by sharing financial information transparently, nonprofits can build credibility. As a charitable organization, "you should be accountable to the public," says Pushpa Aman Singh, chief executive officer of GuideStar India, an online database of information on Indian nonprofit organizations.

Ms. Singh says that when [...]



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