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Pondering the interview with Lorene Cary, I was reminded of something small that can make a big difference. Lorene noted that her brother-in-law's brother gave her wonderful advice when he told her, "...if you have even 5 dollars, you should have somebody to keep track of it." And that is what they do documenting "every penny" flowing into and out of the Art Sanctuary.
Non-profit organizations are under increasing pressure to do a better job of documenting how they utilize their funds. Donors like to fund organizations where their dollars will work hard and have maximum impact. How will they know this if your records don't show it? Donors need "a peek behind the scenes" to establish for themselves that you're taking good care of the money they gave your organization.
Managing your funds with care, and documenting that you have done so, is critical to your mission and to receiving increased donations. You need to show donors that "$1.00 spent here will buy this much service to the community." Show them that your employees are twice as productive as the average worker in the for-profit sector. Show them how much in real dollars your volunteers mean to your organization.
Money is a "language" that everyone understands, and it can help you build a powerful case for strengthening offerings and expanding your reach.
If a donor sees that you are fiscally prudent, their confidence in you and your organization will increase. Do not assume that their desire to see your books signals lack of trust. They are making an investment in your organization. They want you to succeed. In turn, you want to demonstrate that theirs is a worthwhile investment.
Start by asking yourself if you can do a better job of keeping track of cash flow. If you can (and this is true of most of us), start there. If you don't know where your money is going, then don't expect someone else to give you more to spend. You will only stengthen your case with potential donors by opening your books and giving them that sought-after "peek."
It's easy to view measurement as "the enemy" when you are inundated by different documentation requirements that eat up time and energy you could be using to deliver service. But it can become your "friend" if you make it your own, using it as a tool for building your NPO's strength. Documenting cash flow is a simple, straightforward way to start. And, it is a little thing that can make a big difference. Just ask Lorene.
Related Links:
Basic Guide to Non-profit Financial Management assembled by Carter McNamara, MBA, Ph.D
The Cyber-Accountability Forum founded by Harriet Bograd
United Way Outcome Measurement Resource Network
by Michael Feagans
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