Calculation of Profits
We understand that it's all well and good saying that we are going to put back 80% of profits into the Community
but if the owners are drawing a big salary, then this rule has little value! Hence we pledge that 80% of all profits from Reality Tours will be paid to Reality Gives or other NGOs after the payment of the following:
Tour company expenses
Tax payable on profits
A reasonable salary to the two owners - Chris Way and Krishna Pujari - for conducting the slum tours. This has increased steadily over the years and is disclosed in the accounts below. This is still a lot less than what an owner of a tour and travel company would earn.
The profits are then adjusted because there are some payments which have been paid for Reality Gives by Reality Tours. This includes an apportionment of some salaries as some staff work for both Reality Tours (who pay them) and Reality Gives.
We want to show how much the tour company would earn without any contribution to Reality Gives. Also there is an adjustment for Chris Way's excess salary (to comply with visa regulations, Chris Way has had to be paid US$ 25,000)
We then calculate 80% of this adjusted post tax profit which is what needs to be spent on Reality Gives activities or donated to them.
We then calculate how much money was actually spent that year on Reality Gives' activities or donated to Reality Gives (or other NGOs), and then the balance- What was due less what was spent/donated.
You might wonder why Reality Tours would make payments on behalf of Reality Gives. Why doesn't Reality Gives make the payments themselves? We consider the activities of the Community Centre in Dharavi for example, essential in the successful running of the Dharavi tour.
Here is a document summarizing Reality Tours' profits and expenses and how the money given to Reality Gives was spent.