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.

A screen grab of one of the statements for Patanjali Yogpeeth.

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 conducting due diligence on nonprofits, they typically look for documents like the organization’s balance sheet, income and expenditure statement and a receipts and payments account, which gives a picture of the organization’s annual budget.

The disclosures by Baba Ramdev’s organizations contain only some of this information. For the Bharat Svabhiman trust, there is an income and expenditure statement but no balance sheet is provided. It’s not clear what this trust’s total assets are, but it earned a net income of 91 million rupees ($2 million) in the year ended March 31, 2010.

For the Acharyakul Shiksha Sansthan, there is a barebones income statement and a balance sheet which shows assets of around 17 million rupees ($380,000), almost entirely invested in the Gurukul Kishangarh Ghasera, a training institute.

The most detailed information is available for the Patanjali Yogpeeth trust, with balance sheets for every year since 2004-2005. For most of these years, the income statement is also provided.

As of March 31, 2010, this trust had total assets of nearly 1.8 billion rupees ($40 million). These include the trust’s fixed assets like buildings worth 1.14 billion ($25 million) and current assets like postage stamps worth nearly 4 million rupees ($89,000).

In the financial year ended March 2010, the trust earned around 450 million rupees ($10 million) in net income.

The expense column shows that around 4 million rupees ($89,000) were spent on “salaries” and as “honorarium to swayasevaks [volunteers].” That’s a jump of nearly 10 times from the prior year ending March 31, 2009, when no salaries were paid and the swayamsevaks got 434,000 rupees ($9,700) in honorary payments. The trust’s telephone expenses have also risen sharply in recent years – going from just 13,500 rupees ($300) for the year ended March 31, 2008 to 9.3 million rupees ($208,000).