Nonprofit Financial Management Checklist

nonprofit-financial-management-checklistWith the expectation that nonprofit organizations have to be financially responsible to their board, themselves, their stake holders, and the government comes the need to be extremely organized and methodical in accomplishing tasks. This is not easy, but a little organization can go a long way in helping to regulate and improve financial management for nonprofits.

It is easiest to stay current on needed tasks by splitting them into what needs to be done more and less frequently. A nonprofit financial management checklist can help guide your organization in knowing what tasks need to be done and when. This will keep financial information up-to-date and ready for needed submissions to the government and people involved in the organization.

Daily and Weekly Reminders to Keep at the Forefront

o   Each day’s tasks and meetings are established and prioritized (important ones are done first and others are scheduled around them).

o   The organization’s goals and mission should be reflected in and aligned to the work done.

Monthly Financial Checklist– Focus on the Budget and Collaboration

o   Review and compare budget projections and actual results: This will help you be sure that your revenue is sufficient to take care of expenses and will clarify how last month’s financial activity will impact future months.

o   Make adjustments based on these results: Your review and comparison should lead you to make immediate decisions about future actions based on your data.

o   Trim the budget’s fat: Analyze each line item to cut unnecessary or underutilized expenses.

o   Analyze costs as a team: Meet together as a budget task force to make decisions regarding variable costs to either remove them completely or determine if they should become fixed costs. Focus on budget efficiency without compromising the quality of your organization.

o   Submit grant proposals: Be aggressive in seeking more funding not only to sustain your organization but also to expand it.

o   Collaborate: Look for businesses and other nonprofits to form partnerships with. Businesses with shared interests may support your cause, and other nonprofits can be a great source of shared networking and fundraising efforts.

Quarterly Checklist– Focus on Important Board and Government Accounting Requirements

o   Report payroll taxes to the IRS: Submit the required Form 941 which is the employer’s quarterly federal tax return.

o   Prepare financial statements for the board: Knowing the current financial status for future planning and to fix potential finance problems is essential.

o   Submit financial status reports and progress reports for government grants and contracts: The government expects to know the current state of expenditures and what has been accomplished versus what was expected to be accomplished.

o   Meet with the board: It is a federal requirement to meet with the board of directors at least four times per year.

Annual Checklist

o   Submit Form 990: This annual information report should be submitted to the IRS to report on financial activities, sources of income, and spending.

o   Release payroll reports: The Social Security Administration, IRS, and the employees need to know this information. This could include Form 941, W-2s, W-3s, and 1099s.

o   Get an audit of your financial statements: A CPA’s audit will serve as a second opinion regarding the validity of your finances and adds credibility to your accounting practices.

o   Create next year’s budget task force: Seek out staff and board members skilled to contribute to the assessment of the budget.

o   Organize a grant and contract application team: This important team researches, develops, and submits these applications for your organization.

o   Re-evaluate your goals: Prepare for your annual board meeting by evaluating achieved, ongoing, and new goals that should be put into place.

RBP Methods offer software solutions to help you with these tasks. If you need assistance with overall accounting (budget, financial report, payroll reports, etc.) tasks, check out AccuFund Accounting’s Nonprofit Suite. For the many tasks related to grants that are listed above, Grant Management Software is a great solution. Abila Grant Management software can help maximize funding potential by combining development, contact, and financial data for successful tracking. Please contact RBP Methods to learn more about these solutions to your nonprofit financial management needs by calling 503-648-9051.