Is there a rating system for charities?

Organizations like Charity Navigator and Charity Watch provide ratings for charities largely based on spending efficiency. Ratings organizations often develop their own ratings systems, although they tend to have a number of criteria in common.

Financial reports are one of the main items used to rank charities. Ratings organizations analyze these documents to find out how much of the money the charity takes in that goes to its stated programs, as opposed to other costs, like marketing and employee salaries. Other factors such as a charity's accountability, transparency in reporting finances and the length of time it has been a charity may also be taken into account.