When you recommend a grant from your donor-advised fund, your sponsor runs a check before the money moves. That is a good thing. It is also narrower than most people assume.

The sponsor's screen is mostly asking one question: is this a real charity we are allowed to pay? It confirms the organization's tax status, checks it against government watch lists, and, if your sponsor is Catholic, often confirms the grant does not conflict with Church teaching. What it does not ask is whether the organization is any good at what it does, whether it is healthy, or whether it is the right fit for what you are trying to do.

That part belongs to you. And it turns out to be one of the better parts of giving, because it is where you stop sending money to a logo and start knowing the people you are supporting.

Here is a checklist to work from. You will not need every item for a $500 gift to your parish food pantry. You will want most of them before a $25,000 multi-year commitment.

What your sponsor's screen actually covers

It helps to know where the floor is before you build on it. Most DAF sponsors will verify:

• IRS status. The organization is a 501(c)(3) public charity, or a church, school, or other eligible entity, in good standing.

• Sanctions and watch lists. Usually an OFAC check and similar.

• Prohibited benefits. Your grant cannot buy you gala tickets, pay tuition, or cover a personal obligation.

• Mission screen (Catholic sponsors). Many Catholic sponsors decline grants to organizations whose work conflicts with Church teaching.

That is a real service. But look at what is missing: leadership, finances, results, culture, and fit. A charity can clear every one of those screens and still be struggling, poorly run, or simply the wrong partner for you.

Step 1: Start with your own "why"

Before you look at anyone else's numbers, get clear on your own intent. It sounds backwards. It saves a lot of time.

Ask yourself:

• What community or need am I trying to serve with this gift?

• Am I giving to sustain something I love, or to help something new get off the ground?

• How much risk am I comfortable with?

• Is this a one-time gift or the start of a relationship?

If you have not written this down, it is worth an hour. We walk through it in From Reactive Giving to a Strategy: Building an Annual Plan for Your Catholic DAF.

Step 2: Read the public documents (it takes less time than you think)

You do not need to be an accountant. You need about thirty minutes and a little curiosity.

The Form 990. Most public charities file one each year, and it is free on sites like ProPublica's Nonprofit Explorer or Candid. Look at:

• Total revenue over three years. Growing, flat, or falling?

• Program spending compared to total spending. Do not obsess over the overhead ratio, but very low program spending deserves a question.

• Leadership pay. Reasonable for the size and the region?

• The board roster. Is it a real, independent board, or mostly family and staff?

One note. Parishes, dioceses, and many Catholic schools and religious orders do not file a 990, because churches and their related entities are exempt from the filing requirement. That is normal. It just means you will ask for audited financials or an annual report directly.

The annual report and audit. Organizations above a certain size usually have an independent audit. Ask for it. A healthy organization will send it without fuss.

The website. Read it like a stranger would. Can you tell what they actually do, for whom, and how they know it is working?

Step 3: Look at leadership and governance

Good programs rarely outlast weak leadership. A few things to check:

• How long has the executive director been there? Long tenure can mean stability, or it can mean there is no succession plan. Very short tenure is not bad, but ask about the transition.

• Does the board actually govern? Ask how often it meets, whether there is a finance committee, and whether board members give.

• Is there a conflict-of-interest policy? There should be, and it should be used.

• For Catholic organizations: What is the relationship with the local bishop or religious community? Is the Catholic identity alive in how they serve, not just in the logo?

Step 4: Ask about results, honestly

Every nonprofit has stories. Fewer have evidence. You want both.

Good questions:

• "What does success look like for you this year, and how will you know if you hit it?"

• "What is something that did not work, and what did you change?"

• "Who else funds you, and has anyone stopped?"

That second question tells you a lot. Organizations that can name a failure and what they learned from it tend to be more trustworthy than the ones where everything is always going great.

Be fair, though. A small, faith-based ministry serving people in crisis may not have a data team. Do not punish them for that. Look for honesty, clear goals, and some real way of paying attention to whether people are actually helped.

Step 5: Check the finances for health, not perfection

You are looking for warning signs, not spotless books.

• Reserves. A common rule of thumb is three to six months of operating cash. Zero reserves means one bad quarter could become a crisis.

• Revenue concentration. If one funder provides half the budget, that is fragile.

• Deficits. One deficit year can be fine, especially if it was planned. A string of them is a conversation.

• Restricted versus unrestricted money. Lots of restricted grants and very little flexible money often means the organization is stretched thin.

Step 6: Go see it, if you can

There is no substitute for a visit. Sit in on a program. Eat lunch with the staff. Talk to someone the organization serves, if it is appropriate and they are willing.

You will learn things no 990 will tell you. How staff treat each other. How they treat the person who walks in the door. Whether the place feels alive.

If you cannot visit, a video call with the executive director and one program staffer is a decent second best.

Step 7: Weigh mission fit through a Catholic lens

This is where a Catholic funder's due diligence differs from a secular one. Beyond "is this charity effective," you are asking "does this work honor the dignity of the people it serves?"

Some questions to sit with:

• Does the organization treat people as persons, not cases?

• Does it strengthen families and local communities, or quietly replace them?

• Does it respect subsidiarity, letting decisions be made as close to the people affected as possible?

• Does it serve the poor and vulnerable in a way that builds up their own agency?

These come straight out of Catholic social teaching. If you want to go further, see How to Align Your Donor-Advised Fund With Catholic Social Teaching.

Step 8: Decide the size and shape of the gift

Due diligence is not only a yes or a no. It should shape how you give.

• Strong, proven organization? Consider unrestricted, multi-year support. It is the most useful money a nonprofit can get.

• Promising but unproven? A smaller first grant with a check-in after a year is reasonable.

• Great program, shaky operations? Maybe a capacity grant for finance or leadership, rather than more program money.

The short version: a printable checklist

Here is the whole thing in one place.

Before you give

- [ ] I know why I am making this gift and what I hope it does

- [ ] Sponsor screen passed (status, sanctions, mission)

Documents

- [ ] Reviewed three years of 990s (or audited financials for church entities)

- [ ] Read the most recent annual report

- [ ] Asked for the latest audit if the organization is large enough to have one

People

- [ ] Understand executive leadership and tenure

- [ ] Board meets regularly and has independent members

- [ ] Conflict-of-interest policy exists

Results

- [ ] Organization can describe its goals and how it measures progress

- [ ] Organization can name something that did not work and what changed

Finances

- [ ] Has some operating reserve

- [ ] Not overly dependent on a single funder

- [ ] Deficits, if any, are explained

Fit

- [ ] Visited or spoke with leadership directly

- [ ] Work honors human dignity, family, subsidiarity, and the poor

- [ ] Gift size and structure match what I learned

You do not have to do this alone

Here is the part nobody mentions when you open a DAF. A lot of other Catholic funders are vetting the same organizations you are. Some of them did the site visit last spring. Some have funded that ministry for ten years and know exactly where it is strong and where it is stretched.

Talking with those people is often the fastest, most honest due diligence there is. It is a big part of why the Philanthropy community exists, so Catholic DAF holders and small foundations can compare notes, share what they have learned, and give with a little more confidence. If that sounds useful, you are welcome to take a look.