Finance and Development Collaboration

The information provided by the finance departments and the development departments at not-for-profit organizations often does not agree and it doesn’t have to. What does have to happen is the numbers must be able to be reconciled from one to the other, especially if two separate reports are being provided to the Board of Directors. Organizational practices are intended to benefit the organization as a whole and not just one department. While many finance and development departments work well together, here are four areas to collaboratively focus on for better data and compliance.

1. Year-end Cut Off

Establish a collaborative process for proper donation cut-off to ensure recording in the correct year for both the organization and donor,

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Financial Education for Your Children: Allowances Are Just the Beginning

Healthy financial habits that last a lifetime must start at an early age. Whether you have a kindergartner or “tween,” here are a few tips you can take to teach money and finance fundamentals to your children.

Chores are your child’s first job

If your child understands the difference between a nickel and a dime, then they can start learning the value of currency. Distributing a weekly allowance for chores completed is a good way to reinforce this learning. You could start with a weekly allowance of a dollar for every year of age, but no matter the amount, they’ll have a chance to earn money and decide what to do with it.

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A Deeper Dive into Not-for-Profit Functional Expense Reporting

By Sarah Wine, CPA

As we reported in part six of our Big Changes Coming for Financial Reporting of NFP Organizations, effective for fiscal years beginning on or after December 15, 2017, all not-for-profit (NFP) entities will be required to present expenses on a functional and natural classification basis. Following is a deeper dive into not-for-profit functional expense reporting.

As many NFP organizations choose to present two years of financial statements, now is the time to start thinking about how the new standard will impact your organization. For most organizations, this will not be an entirely new exercise, as they have a statement or schedule of functional expenses as part of their financial statements.

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Is It Too Late for a Governance and Financial Policy New Year’s Resolution?

By Cheryl Olson, CPA, CGMA

Now that we’re in March, many of us have given up on our New Year’s resolutions. Some of us didn’t make resolutions to begin with based on past history. That said, It’s not too late to make a 2017 commitment to create, review, or update your organization’s key governance and financial policies.

To be most effective, policies need to be kept current so they reflect your organization’s internal culture and external environment. While this can be an overwhelming task, following these five tips will help you to get your policies in healthy shape.

Policy Index

Create a policy index that lists all of the organization’s policies in one place,

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How Unrestricted Are Your Net Assets?

One typically thinks of net assets in one of three categories: unrestricted, temporarily restricted, or permanently restricted. Organizations with endowments are very familiar with the concept of comparing the organization’s permanently restricted net asset balance to the related investment balance, and determining the amount that those net assets are over or under water. A similar concept exists with unrestricted net assets, which too few non-profits are looking at. Monitoring this equation, however, could prove be one of the best indicators of positive or negative financial trends in your organization.

The concept is simple: determine the amount of unrestricted net assets that you could spend on any purpose,

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