How are my child sponsorship donations distributed? Do all funds go to the families or do some funds go towards community projects?

The primary focus is the child and the family. This is the initial focus of child sponsorship funds. Funds are provided directly to the family to cover the child's schooling, health and related costs. In some instances, we provide funds directly to the school / institution.
In some communities, a portion goes towards providing a support system in the form of community service projects that benefit the child and family. This takes the form of after-school lessons / coaching for the children, mosquito nets for the entire family, microfinance and small business training / loans, skills training such as tailoring, basic computer training, school supplies etc. These projects target empowering lives toward self-sufficiency. The overall goal is to benefit the community and raise the overall standard of living. When the community benefits, everyone is better off.
In each community, a percentage of funds goes towards coordinating activities, staffing, communication, equipment, utilities etc. .
A fraction goes administrative and fundraising expenses in the USA - including donor canvassing,.donor communication (providing updates to donors etc), rent, utilities, staffing etc.

The above 4 points apply not just to child sponsorship but to the organization as a whole.

Globally, many donors have expressed a concern about non profit organization overhead costs in general. As you consider overhead costs here is a quote from one of the following linked pages that you may find helpful.

More and more nonprofits, joined by enlightened grant makers, are comfortable with the reality that costs – whether referred to as “overhead,” “management and general,” “administrative,” or “indirect costs” - are essential to their ability to advance their missions. But, in order to maintain the donating public’s trust, it’s important to be transparent about your nonprofit’s finances and also the outcomes of your nonprofit’s activities.

Form 990: Each year, Develop Africa files a from 990 with the IRS. From these public financial documents, you can see the breakdown on how funds were spent. Copies of this are available for all past years from the Official Documents page. If the most recent year is unavailable, this simply means that filing has not yet been completed. This should be completed by the end of the following year.