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Recruiting and Using Finance Volunteers in Governance Roles
Finance should always have a seat at the leadership table within a nonprofit organization. There is an embedded financial impact in all Board and management decisions. To ensure the delicate balancing act of mission vs. financial health is kept front and center, make thoughtful positioning of volunteers with financial experience a priority when finding and seating your Board of Directors and various committees.
There Is No Perfect Financial Dashboard and That Is Good
The problem with financial dashboards is that everybody has a different idea about what makes up a “perfect” dashboard. Opinions are important and the sharing of those opinions in a collaborative process is value-added. It is important to set up a proper framework for this discussion to develop a financial dashboard that fulfills most of the needs of your organization’s many different end-users, which may be quite different from other organizations. The question to ask is not whether a financial dashboard is “perfect” but whether it is “useful” to your particular organization.
How to Be a More Impactful Treasurer
How can treasurers step up their game and be more influential as a Board leader? The answer lies in expanding the traditional treasurer role beyond financial reporting and protecting the organization’s financial assets. Enterprise risk management (ERM) is very important, but treasurers have so much more to give.
Repositioning for the Long Road of Recovery
We are on the doorstep of one year into a pandemic that no one saw coming. Nonprofits of all shapes and sizes had to move rapidly to respond to unexpected disruptions. Capacity, operations, and funding all were impacted and impacted quickly. As we watch mass vaccination centers come on-line and COVID-19 safety restrictions starting to be lifted, we can begin to look ahead to the long road of recovery and dream about the new normal somewhere in the future.
Strong Financial Health Opens the Door to Collaborations with Other Nonprofits
There are many advantages to participating in joint ventures, coalitions, strategic alliances, or other types of collaborations with other like-minded nonprofit organizations. These types of formal and informal partnerships enable organizations to share programs, capabilities, and gain access to a wider array of members, constituents, and geographic regions. These opportunities multiply if your nonprofit has strong financial health.
Now is the Time to Push for Changes to Non-Full Cost Funding Practices
Our recent article on the Challenges of Accepting Non-Full Cost Funding prompted compelling and thoughtful comments on the universal problem of non-full cost funding in the nonprofit sector. Many commented that non-full cost funding is a systemic problem that fuels marginalization of the communities, causes, and peoples we serve. To right this wrong, we must draw attention to these problems and advocate for change. Indeed, real sustained effectiveness cannot be achieved if this harmful funding culture continues.
The Challenges of Accepting Non-Full Cost Funding
Most nonprofit organizations are confronted with an unfair choice each year: accept or not accept critical funding that is inherently designed to not cover the full cost of programs and activities for which the funding is provided. This reality has been around for a long time. Looking to the future, we must actively push funders to recognize that sustainability will be damaged if nonprofits continue to be forced to compete for, and pressed to accept, non-full cost funding.
Why and How Should a Nonprofit Form a Subsidiary?
The formation of subsidiaries is a consideration that surfaces during the lifetime of many nonprofit organizations as a strategy to expand operations, growth, and overall capacity to deliver more on mission. A subsidiary is a separate entity that is controlled (to some degree) by a parent organization, and subsidiaries are created by nonprofits for a wide variety of reasons.
To Plan for 2021, We Have to Learn How to Recognize People’s Uncertainty
This December is different from all others. We have the familiar ritual looking ahead and embracing the anticipation of how the next year will play out. But COVID-19, the expanded attention on correcting social injustices, and other events of 2020 have introduced unprecedented new challenges into this end-of-year planning process.
When to Prioritize Legal Review of Your Nonprofit’s Contracts
Contracts are the lifeblood of any nonprofit organization’s day-to-day operations, just as with for-profit businesses. In an ideal world free from budget and time constraints, nonprofits would have every contract reviewed by a reputable attorney with the relevant subject matter expertise. However, for some organizations legal review is not always feasible.
Strategies to Keep Board Members on Track with their Commitments
Getting Board members to follow through on their commitments of time and money to the nonprofits they serve can be very challenging. Often, we let our emotions rule, getting frustrated and blaming the Board members for lack of engagement. This is misguided. We need to work harder to help Board members engage at higher levels.
Three Key Planning Steps to Get a Head Start on Your Next Audit
With disruptions from COVID-19 continuing into the foreseeable future, it is best to start planning for your next year-end financial statement audit early. Odds are that your next audit experience will be different than your last one due to the many programmatic and operational changes that most nonprofits have experienced this year. Investing some extra time in front-end logistical planning will lead to smoother sailing and better outcomes.
A Revenue Aligned Budget is the Safe Way to Go
I feel the time is right to stretch our budget planning and begin to envision operations from the perspective of a balanced budget aligned to a conservative estimate of revenue and funding for the next 12 months. I am now advocating for using a “revenue aligned budget” strategy that is realistic in nature, obtainable, with low risk and a high degree for success.
Some Legal Issues to Consider When Trying to Get Out of Your Office Lease
As the financial pressures on nonprofit organizations mount and many employees continue to work remotely from home, nonprofits are increasingly examining their options for getting out of their current office leases. This issue is particularly problematic for nonprofits whose current office leases are set to expire years into the future. A careful assessment of your organization’s legal rights and options is critical to navigate this issue effectively.
It is Time to Be Proactive With Your Office Lease Situation
A familiar scenario has played out month after month for many nonprofit organizations during this prolonged period of financial uncertainty, remote work, and virtual programs and meetings. The time has come again to pay another month’s rent for your headquarters office. Frustrated that your office space is going mostly unused, you cut the check and feel like this is a wasted expense. While it is easy to feel helpless in this situation, it is time to start the proactive planning process and take control. There are only no options when you have convinced yourself there are no options.