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KDE Again Operated at a Loss During 2023

58 points by ReadCarlBarks 2y ago

dtx1 2y ago
So... Where did they get the money that they spent then?
- Arnt 2y ago
  "Our annual income for 2023 came in just slightly below our projections, with a small difference of less than 500€. Our expenses came in below target due to a conservative planning approach that generally assumes an expense maximum, but in line with our general expectations. Both outcomes demonstrate our ability to make accurate forecasts — an important ability given our 2023 operational goal of outspending our annual income for the second year in a row, which we have achieved, in order to reduce our financial reserve (which remains high from large one-time donations in earlier years) in accordance with our non-profit organizational form." A German e.V. can't keep arbitrarily large reserves indefinitely. It needs to use its money for its stated purpose, or else it may lose its tax status. KDE's plan makes sense.
  - BirAdam 2y ago
    Thank you for clarifying.
advisedwang 2y ago
> it was another year they unfortunately operated in the red funding wise. As Arnt point's point's out, this was not unfortunate. It was intentional, necessary and calculated. See the report itself (https://ev.kde.org/reports/ev-2023/#welcome-to-kdes-annual-report-2023 https://ev.kde.org/reports/ev-2023/#welcome-to-kdes-annual-r...)
- aidenn0 2y ago
  There are over a dozen articles on the page you linked; which one discusses this? [edit] found it under Financial Working Group This says they need to spend down their reserves because they are a non-profit? Is there some particular rule in the jurisdiction they are incorporated in where non-profits can't maintain large reserves? A lot of non-profits in the US are funded primarily from investment proceeds from endowments.
  - olddustytrail 2y ago
    Yes, as mentioned downthread: "A German e.V. can't keep arbitrarily large reserves indefinitely. It needs to use its money for its stated purpose, or else it may lose its tax status."
  - Arnt 2y ago
    That kind of nonprofit can't maintain reserves without justification. It received tax-deductible donations for a purpose and has to spend its money for that purpose. It has a lot of flexibility wrt what level of reserves are sensible in its case or when to spend received donations, but the taxman will ask when that money is going to be spent.
- bmer 2y ago
  I am surprised to see phoronix getting that so wrong…
jychang 2y ago
https://ev.kde.org/reports/ev-2023/ https://ev.kde.org/reports/ev-2023/ > Our annual income for 2023 came in just slightly below our projections, with a small difference of less than 500€. This is a nonissue.
- kadoban 2y ago
  Doesn't that just mean they knew in advance they weren't making enough to pay the bills? Better than it being a surprise, but still not great.
  - eigenspace 2y ago
    It actually is great. KDE is a non-profit and they’re not allowed to operate at too much of a surplus. They were getting too much money in donations so they purposefully hired a bunch more employees to soak up the increase in funding they had. This is a great problem to have.
- Rinzler89 2y ago
  >This is a nonissue. Why?
  - kylebenzle 2y ago
    Because $500 - $1,000 is not a lot of money and they already had "too much" money.
ndiddy 2y ago
One of the KDE devs replied to this getting posted on Reddit (https://www.reddit.com/r/linux/comments/1facwbt/kde_operated_at_a_loss_in_2023/lls4fit/ https://www.reddit.com/r/linux/comments/1facwbt/kde_operated...): "It was intended to run at a loss this year. We had loads of money from donations that wasn't spent on travel during the pandemic. This has been the case for a few years, we're a non profit, we're not allowed to have huge surpluses in the bank by eV laws. Now we are deliberately over spending with developer hires, we will long term have to build donations to sustain that new level but it's not a problematic situation."

58 points by ReadCarlBarks 2y ago

dtx1 2y ago

So... Where did they get the money that they spent then?

Arnt 2y ago
"Our annual income for 2023 came in just slightly below our projections, with a small difference of less than 500€. Our expenses came in below target due to a conservative planning approach that generally assumes an expense maximum, but in line with our general expectations. Both outcomes demonstrate our ability to make accurate forecasts — an important ability given our 2023 operational goal of outspending our annual income for the second year in a row, which we have achieved, in order to reduce our financial reserve (which remains high from large one-time donations in earlier years) in accordance with our non-profit organizational form." A German e.V. can't keep arbitrarily large reserves indefinitely. It needs to use its money for its stated purpose, or else it may lose its tax status. KDE's plan makes sense.
- BirAdam 2y ago
  Thank you for clarifying.

advisedwang 2y ago

> it was another year they unfortunately operated in the red funding wise. As Arnt point's point's out, this was not unfortunate. It was intentional, necessary and calculated. See the report itself (https://ev.kde.org/reports/ev-2023/#welcome-to-kdes-annual-report-2023 https://ev.kde.org/reports/ev-2023/#welcome-to-kdes-annual-r...)

aidenn0 2y ago
There are over a dozen articles on the page you linked; which one discusses this? [edit] found it under Financial Working Group This says they need to spend down their reserves because they are a non-profit? Is there some particular rule in the jurisdiction they are incorporated in where non-profits can't maintain large reserves? A lot of non-profits in the US are funded primarily from investment proceeds from endowments.
- olddustytrail 2y ago
  Yes, as mentioned downthread: "A German e.V. can't keep arbitrarily large reserves indefinitely. It needs to use its money for its stated purpose, or else it may lose its tax status."
- Arnt 2y ago
  That kind of nonprofit can't maintain reserves without justification. It received tax-deductible donations for a purpose and has to spend its money for that purpose. It has a lot of flexibility wrt what level of reserves are sensible in its case or when to spend received donations, but the taxman will ask when that money is going to be spent.
bmer 2y ago
I am surprised to see phoronix getting that so wrong…

jychang 2y ago

https://ev.kde.org/reports/ev-2023/ https://ev.kde.org/reports/ev-2023/ > Our annual income for 2023 came in just slightly below our projections, with a small difference of less than 500€. This is a nonissue.

kadoban 2y ago
Doesn't that just mean they knew in advance they weren't making enough to pay the bills? Better than it being a surprise, but still not great.
- eigenspace 2y ago
  It actually is great. KDE is a non-profit and they’re not allowed to operate at too much of a surplus. They were getting too much money in donations so they purposefully hired a bunch more employees to soak up the increase in funding they had. This is a great problem to have.
Rinzler89 2y ago
>This is a nonissue. Why?
- kylebenzle 2y ago
  Because $500 - $1,000 is not a lot of money and they already had "too much" money.

ndiddy 2y ago

One of the KDE devs replied to this getting posted on Reddit (https://www.reddit.com/r/linux/comments/1facwbt/kde_operated_at_a_loss_in_2023/lls4fit/ https://www.reddit.com/r/linux/comments/1facwbt/kde_operated...): "It was intended to run at a loss this year. We had loads of money from donations that wasn't spent on travel during the pandemic. This has been the case for a few years, we're a non profit, we're not allowed to have huge surpluses in the bank by eV laws. Now we are deliberately over spending with developer hires, we will long term have to build donations to sustain that new level but it's not a problematic situation."