Accountant advises client not to set up private foundation
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As one of Ottawa’s most successful Indo-Canadian high-tech businessmen, Nishith Goel has a knack for taking all the right risks. In 1995, he took the daring leap to entrepreneurial status when he left Nortel Networks to found Cistel Technology Inc. An information technology and engineering consulting company, Cistel has since been named one of Canada’s fastest growing professional service organizations for four years running in the Branham 300 list.
In turn, Nishith was quite prepared to bring that same entrepreneurial spirit to his charitable giving plan. In the early 2000’s, he approached his accountant about setting up a private foundation to allow him to give back to the community. His accountant made a strong argument against taking that route. As he pointed out, starting up and maintaining a private foundation requires the establishment of a registered charity with a board of trustees that must report to the Canada Revenue Agency on a regular basis. It’s a far-from-simple venture with burdensome administrative responsibilities.
Not long after this meeting, Nishith found an ideal compromise. Instead of setting up his own foundation, Nishith discovered he could achieve his charitable objectives by establishing a donor-advised fund with the Community Foundation of Ottawa. It would give him all the advantages of a private foundation without the challenges involved in its management.
Working with the Community Foundation, the Cistel Foundation was established in 2003. Through the fund, Nishith has been able to instill his own strong spirit of sharing in his employees, who make regular donations and participate in fundraising for its causes. Through their understanding of the power of social responsibility, Nishith and his management team are leveraging the Foundation to engender support and commitment among their employees.
Nishith’s efforts to give back have been characteristically successful. Over the last several years, the Cistel Foundation has disbursed thousands of dollars in grants to a wide variety of charitable organizations. Whether providing funding to a local hospital, assistance to a micro-enterprise initiative for women in India, or support for a small grass-roots organization here in Ottawa, the company is steadily building its social capital.
Thanks to wise advice, one client is able to realize his dreams and enjoy the rewards of doing good without having to become entangled in all the administration involved. To see a comparision between having a donor-advised fund at a community foundation and establishing a private foundation, click here.
