|
For organizations operating on a calendar year, fall is budget season. Given all
the uncertainty, has the budgeting process changed? And for organziations with
a different fiscal year, like Nonprofits Assistance Fund, what should we be
tracking? What do nonprofit financial leaders need to stay on top of as we move
into the last quarter of the year?
Looking Ahead
Unfortunately, for nonprofits it will probably be more of the same. More
uncertainty, particularly around year-end giving, as we enter year two of a
chilly economy. Any positive changes are unlikely to positively impact the
nonprofit sector for another year.
So, how can nonprofit leaders make smart decisions to bring their
organziations through this long winter?
In order to manage uncertainty, we have encouraged nonprofits to engage in
vigorous scenario
planning. Having thought through a range of possible options, you will be
positioned to make informed decisions if things don't go according to plan. And
right now, things rarely go according to plan. Remember, as much time as we
spend crafting carefully considered budgets based on sound assumptions, this is
also a tool that has to be flexible. If your income or expenses change
significantly, even the best laid plans must change. Read
more about budgeting in this uncertain environment or view other resources
to help implement healthier financial practices.
Over the last year we have also encouraged nonprofits to reconsider how they
do business. It's even the subject of one of our breakouts at Transforming Our Work, the joint MCN/MCF conference next
month. In Change Agents we will unpack the question, "What will it
take to get your organization to a sustainable business model?"
It's not easy. It takes a lot of time to think through your options and test
new possibilities. We know this, because we've been taking our own advice. The
change happening in the nonprofit sector requires us to reconsider how we can
best fulfill our mission of helping build financially healthy organizations.
One example of how we're responding is our new online training option. We
added webinars
to meet the changing needs of the nonprofit community. Now you can enhance your
financial skills and leadership whether you are in Minneapolis or Moorhead,
across town or across the country. We are very excited to offer webinars, but
they have a different set of logistics. Just like any new service, we're working
through how this impacts our program mix.
We are also pleased to have Steve Boland join our staff as the newest member
of our lending and training team. Steve is a great addition who significantly
increases our capacity to provide support to nonprofits. Make sure to say hello
to Steve and the rest of our staff at the Transforming Our Work conference in
November.
Addressing Systemic Problems in Charter School
Financing
Right now, there are unique challenges facing nonprofits. Different kinds of
organizations are facing different issues, dealing with increased need for
services, changes in the state budget, and uncertain revenues. In order for our
sector to be successful, different groups and stakeholders will need to take the
lead in specific areas. Now is the time for all of us to find the ways that we
can exercise leadership at key moments and work together to strengthen
organizations serving our community.
Nonprofits
Assistance Fund has significant expertise working with charter schools. As
an organization that provides loans, training, and financial management guidance
to charters, we have a unique perspective on their strengths and challenges. We
are identifying best practices on charter school lending and management, as well
as ways to address the problems posed by the increased state holdback.
One way that we are sharing this information is convening interested
parties. Last month, we hosted a special forum for bankers and other financial
professionals to learn more about charter school financing and financial
management. Special guest Minnesota Department of Education Deputy Commissioner
Chas Anderson discussed the implications of the state budget. There was also a
discussion on charter school financial management and lending, including best
practices and lessons learned on how charter schools can use credit for their
cash flow and facilities, as well as other ways to help charter schools improve
their finances.
Kate Barr has synthesized key takeaways from this event and Nonprofits
Assistance Fund's experience with charters into a white paper, Cash
Flow Challenges for Minnesota Charter Schools. Read it to find out more
about why the increase in the state holdback is a critical issue for charters,
and what options schools have to manage their cash flow.
From the Blog: Balancing the Mission
Checkbook
Three cheers, at least, are deserved for Grantmakers for Effective
Organizations (GEO) new publication On the Money by Nancy Burd. You can download either the executive summary or full report from
the website.
As summarized on the GEO website:
This publication highlights the financial challenges nonprofits face and the
ways in which grantmakers are both improving the situation as well as
perpetuating the problem.
The first section, Assessing the Problems, identifies five problem areas:
- Restrictions on Funding
- Misperceptions Around Sustainability and Growth
- “Too Many Masters”
- Onerous Grantmaking Practices
- Knowledge Gaps
The other sections discuss Barriers to Smarter Grantmaking and Ideas for
Grantmakers.
It’s impressive how in 28 pages the author distills a variety of ideas,
research, and practices about the realities of financial instability faced by
nonprofits. The report also provides helpful and realistic suggestions for
grantmaking organizations based on practices that have already been developed
and implemented by foundations. The advice and guidance for funders is great,
but this guidebook is a must read for everyone in our sector.
I’m pleased that GEO will be focusing on nonprofit finance and encouraging
foundations to understand how “many prevailing approaches and practices in
philanthropy can unwittingly create problems for the nonprofit sector.” Many
nonprofits have experienced these unintended consequences and will welcome a
dialogue on this topic.
However, nonprofit organizations also have a lot to learn from the report’s
comprehensive overview of grantmaking. Misconceptions about the true cost of
programs and capital needs apply equally (or more) at many nonprofits. We
can’t expect a seismic shift in foundation practices and investment unless we
nonprofit leaders understand and can effectively communicate what it takes to
sustain ourselves.
Other Recent Blog Posts
Upcoming Trainings
Webinar - Financial Clarity
for Nonprofit Boards
Thursday, October 15, 10:00 am - 11:00 am
In this webinar, you will begin by reviewing basic nonprofit financial
reports and terminology. You will then learn to interpret financial information
in context, and learn strategies to effectively participate in financial
discussions and decisions. By the end of the session, you will have a working
knowledge of the nonprofit income statement and balance sheet and will
understand your financial leadership roles and responsibilities.
Register
for this webinar.
Fundamentals of Financial Management
Tuesday, October 27, 8:30 am - 12:00 pm
Your board of directors has ultimate fiscal responsibility
for your organization. This workshop will help you work with them more
effectively.
- Learn how to evaluate your board's financial capacity and teach board
members about nonprofit finance
- Discuss how to improve the flow of financial information between staff and
board
- Explore different report formats
- Learn to write effective narratives
Register
for this workshop.
Webinar - Projecting and
Managing Cash Flow
Wednesday, November 11, 3:00 pm - 4:00 pm
Our popular Managing Cash Flow Workshop is now available as a webinar. We
adapted our curriculum specifically for online training, taking advantage of the
webinar platform to help participants learn how to craft their own cash flow
projections.
- Review the cash flow considerations for different types of income and
expenses
- Discuss how to avoid and manage cash flow problems.
By the end of the session, you will have worked through an example cash flow
projection and will be ready to download our cash flow template and begin
managing cash flow at your organization.
Register
for this webinar.
Calculating True Program Costs
Tuesday, November 17, 9:00 am - 12:00 pm
Do you know what your programs cost? This workshop provides an overview of
program budgeting and allocations.
- Learn to identify direct and indirect expenses
- Review different methods of allocating expenses to programs
Register
for this training.
Financial Management Network
And don’t forget to participate in our monthly lunch series
for nonprofit leaders, the Financial
Management Network. Join us at noon on Wednesday, October 28th
to share thoughts and ideas with your peers on this month’s topic,
Reserves - What Kind and How Much? Just bring your lunch, your business
cards, and your ideas.
Notes
from previous discussions are available on our website. Whether or not you
are able to attend the network, you can benefit from the wisdom of your peers.
About Us
- Announcing a new member of our lending and training team
- A New Partnership with the Blandin Foundation
Announcing a new member of our lending and training
team
Nonprofits Assistance Fund is pleased to welcome Steve Boland as the newest
member of our lending and training team. Steve brings a wealth of experience to
his role as a loan officer, including most recently serving as executive
director of the Greater Frogtown Community Development Corporation.
With this addition, we have four full-time dedicated loan officers,
increasing our capacity to provide financial management support to nonprofits.
Our loan officers advise nonprofits during the loan application and review
process, as well as throughout the life of the loan. They also deliver training
workshops and provide technical assistance on financial management topics to
nonprofits throughout Minnesota.
Please join us in welcoming Steve to the Nonprofits Assistance Fund team. To
learn more about Steve or any Nonprofits Assistance Fund staff member, please
visit our staff bios.
A New Partnership with the Blandin Foundation
Nonprofits Assistance Fund is pleased to announce a grant from the Blandin Foundation to provide financial management assistance
and coaching to nonprofit organizations in Itasca County. This project was
developed to help nonprofits in the region navigate the new economy reality. Our
services will help the organizations assess their current financial situation
and identify ways to sustain their mission, including implementing strong
financial plans, practices, and governance.
Through this strategic partnership, Nonprofits Assistance Fund and the
Blandin Foundation are supporting nonprofits leaders as they build robust and
financially healthy organizations. With this foundation, they will be better
prepared to deliver services and impact communities throughout Itasca County.
Other Resources
- GiveMN
- Advanced Grantseeking Seminar
GiveMN
The Internet is changing the way individuals donate to nonprofit
organizations, and many of us are looking for ways to leverage online giving
options. Your nonprofit organization is invited to be part of a new online
giving platform, GiveMN.org. GiveMN.org will change the way Minnesota donors
find, support and promote their favorite causes. Participate in a free webinar to learn how to make the most of
this tool. You can also visit www.GiveMN.org today to learn more or get started. If you
have questions, call 651-393-2170 or email GiveMN@mapfornonprofits.org.
Advanced Grantseeking Seminar
MCF presents its Advanced Grantseeking seminar on Wednesday and Thursday,
Nov. 4 and 5. Over two half-days, participants will learn about how to use
financial data to tell a nonprofit's story; strategic ways to build
relationships with funding agencies; what trends reveal about the potential
success of campaigns for endowment, capital, operating, program and
sustainability; and more. For more information and a registration form, go to
visit MCF's website or contact MCF at 612.338.1989 or info@mcf.org.
|
