Transparency is a Two Way Street
Transparency as a Planning Tool
National Council of Nonprofits has produced a series of Special Reports on the economy. Their most recent update, Strategies Being Used by Nonprofit Leaders To Cope with the Nation’s Economic Crisis, summarizes findings from a range of reports and provides some key takeaways. I found the first tip is particularly interesting:
[B]eing transparent about financial challenges and “staying close to funders” emerged as an essential strategy for many organizations. Savvy nonprofits are asking grantmakers to be transparent – because nonprofits need to know how much to expect, and within what timeframe, in order to conduct realistic financial planning. For instance, asking foundations to expedite payments, in these times when “cash flow” for many nonprofits feels like “cash drip,” is a fair thing to ask. Likewise, it is better to hear bad news – that a grant will be smaller, or delayed, or even discontinued – earlier rather than later so that adjustments can be made immediately.
Until you have information about the likelihood and timing of grants and other sources of revenue, it’s hard to engage in realistic contingency planning. The Minnesota Council of Foundations is doing their best to gather and aggregate data on how Minnesota grantmakers are responding to economy.
Nonprofits Assistance Fund has also created materials to help organizations manage cash flow and make informed financial management decisions.
- Cash flow template
- Scenario Planning tools:
- Scenario Planning Example
- Scenario Planning Worksheet: A blank template for you to use
To see all of our financial management tools and articles, visit the Resources section of our website.
Nonprofit Harvest
Training and Resources
- New! Blue Avocado Webinars
- Human Resources for Nonprofits Update from Not For-Profit Accounting
- Alternatives to Forming a Charitable Nonprofit an article from Gene Takagi and Emily Chan of the Nonprofit Law Blog
Social Enterprise
- More Details on the Social Innovation Fund from Foundation Center DC
- New corporate structure could give social entrepreneurs new funding stream
- Foundation portfolios, proxy action leverage social change from MinnPost
News and Other Updates
- Sales tax breaks for nonprofits: New rules in the works from MinnPost
- Weathering The Storm – Financial Health Standard from Charities Review Council