Nonprofit Financial Planning Made Easy / Edition 1

Nonprofit Financial Planning Made Easy / Edition 1

by Jody Blazek

ISBN-10: 0471715271

ISBN-13: 9780471715276

Pub. Date: 02/25/2008

Publisher: Wiley

Nonprofit Financial Planning Made Easy

"Financial planning for nonprofits, like a nonprofit's very purpose for existence, is based upon the philosophical aspirations of persons joining together to accomplish mutual goals. The very purpose for existence of a nonprofit is based on hope, sometimes on prayer, and almost always on dreams...The challenge is to stretch

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Nonprofit Financial Planning Made Easy

"Financial planning for nonprofits, like a nonprofit's very purpose for existence, is based upon the philosophical aspirations of persons joining together to accomplish mutual goals. The very purpose for existence of a nonprofit is based on hope, sometimes on prayer, and almost always on dreams...The challenge is to stretch and balance precious resources to best accomplish the dream. Together, the two functions—performing the mission and providing the requisite resources—work in tandem to sustain the nonprofit's existence."
—From Chapter 1 of Nonprofit Financial Planning Made Easy

Are charities wisely using resources to fulfill their missions? Or, are they more concerned about the end of this year, at the future's expense? Good financial planning has always been essential for nonprofits, and nonprofit managers are beginning to realize just how essential, as they face intense competition for a shrinking fund base.

Nonprofit Financial Planning Made Easy presents straightforward strategies to make financial management a more smooth and successful process. Including a glossary of tax and financial terms unique to nonprofits, this book explores:

  • The process of preparing and monitoring budgets

  • How to monitor cash flow to maximize the yield on cash and other invest-ment assets

  • Financial records and the decisions an organization makes in establishing its accounting systems

  • Ratio analysis techniques useful in pinpointing weaknesses and identifying hidden trends

  • The criteria for, and the means ofobtaining and retaining, special tax treatment

Filled with practical forms and checklists to aid nonprofit managers in planning and managing their organizations' financial resources, Nonprofit Financial Planning Made Easy equips nonprofits with step-by-step solutions to the dilemmas involved in keeping financial resources and the mission in balance.

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Product Details

Publication date:
Wiley Desktop Editions Series, #220
Edition description:
Product dimensions:
6.20(w) x 8.90(h) x 1.00(d)

Table of Contents

About The Author.


Chapter One. Introductory Concepts.

How To Use This Book.

Attributes Of Nonprofits.

Can Nonprofits Profit?

Meaning Of Profit.

Profit Prohibitions.

Why Seek A Profit?

Difference Between Nonprofits And For-Profits.

Capitalization: Philanthropists Versus Investors.

Revenues: Constituents Versus Customers.

For-Profit Tools.

Pursuit Of Financial Success: Some Observations.

Be Realistic About Expectations.

Make Use Of Intangible Resources.

Nonprofit Mentality Is Often “Penny Wise And Pound Foolish”.

Financial Accounting For Nonprofits Is Different.

Producing An Audit Trail Benefits The Organization In Many Ways.

Enhancing Computer Capabilities May Not Cure Financial Ills.

Respect The Organizational Structure Or Change It.

Know Who's In Charge.

Economic Conditions Must Be Anticipated.

Long-Range Planning Is Indispensable.

Know Why The Nonprofit Organization Has Tax-Exempt Status.

Comprehensive Financial Planning Checklist.

Chapter Two. Structuring The Organization For Fiscal Strength.

Establishing The Hierarchy.

The Role Of The Board.

Standards For Directors.

Impact Of Sarbanes-Oxley.

A Director's Duties.

Reviewing Financial Reports.

Filling Board Positions.

Finding Prospects.

Staff Representation On The Board.

Compensation For Board Service.

Number Of Directors.

Role Of The Treasurer And The Cfo.

Inside And Outside Accountants.

Financial Management Team.

Defining Inside And Outside Accountants.

Selecting Financial Reporting Services.

Understanding The Auditing Process.

When To Audit.

Review And Compilation Processes.

Requests For Proposals For Accounting Services.

Conflict-Of-Interest Policy.

Chapter Three. Financing The Dream.

Balancing Mission And Finances.

Defining The Mission.

Mission Statement.

Prioritizing Goals.

Assessing The Resources.

Making Micro Resource Decisions.

Macro Resource Analysis.

Chapter Four. Budgeting.

Budget Planning Issues.





Zero Basis Versus Incremental.


Types Of Budgets.

Advantages And Disadvantages.

Who Participates In Budgeting?

Selling The Budget.

Budget Policy Manual.

Communicating The Process.

Scheduling Budget Process.

Changing Budget Midyear.

Timing Dilemmas.

Preparing Forecasts.

Donations And Memberships.

Service Delivery Fees.

Grants And Contracts.

Investment Income.


Statistical Operational Data.

Sample Customer Survey.

Useful Statistics.

Capital Additions Budget.

Monitoring Variances.

Model Budgets.

Proposed Overall 20xx Budget Compared To 20xx Actual.

Functional Revenue And Expense Budget.

Member Services Budget Worksheet.

Budget Increases (Decreases) Projected For 19x7.

Personnel Budget.

Program Cost Analysis.

Other Reports And Analysis.

A Budgeting Checklist.

Chapter Five. Asset Management.

Maximizing Resources.

Getting Resources.

Forming Alliances.

Business Income.

Planned Gifts.

Cash Flow Planning.

Understanding CPA's Cash Flow Statement.

Cyclical Fluctuations.

Designing Cash Flow Budgets.

Beyond Cash Flow Imbalances.

More Money In The Bank.

To Borrow Or Not.

Prudent Investment Planning.

Facing The Unknown.

Risk Versus Return.

Investment Cycles.

Measuring Investment Return.

Restricted Gifts.

Isolating Restricted Grants.

Administrative Costs.


Who Gets The Appreciation?

To Mark It To Market?

How Income Is Measured.

Endowment And Restricted Fund Checklist.

Chapter Six. Nonprofit Accounting.

What Is Accounting?

Cash Receiving Systems.

Cash Disbursement Systems.

Payroll Disbursment System.

Other Useful Ledgers And Financial Files.

Fund Accounting.

Computerized Accounts.

Chart Of Accounts.

National Standard.

Functional Expense Categories.

Why A Double Entry?

Choosing A Method.

Advantages Of Cash Method.

Why Use The Accrual Method?

Design Of The Financials.

Fasb, Gaap And Nonprofits.

Specific Standards For Nonprofits.

Other Nonprofit Reporting.

Internal Controls.

Chapter Seven. Special Financial Tools.

Financial Indicators To Critique Performance.

Economies Of Scale.

Break-Even Analysis.

Performance Statistics.

Cost Accounting.

Techniques For Capturing Costs.

Cost Allocation Methods.

Purchasing Procedures.

Approval Systems.

How Much Paper Work?

Measuring Lifetime Cost.

To Lease Or To Buy.

Affiliations And Agency Agreements.

Who's An Employee?

Chapter Eight. Obtaining And Maintaining Tax-Exempt Status.

Characteristics Of Tax-Exempt Organizations.

Theoretical Basis For Exemption.

Categories Of Exemption.

Tax Deductibility.

Understanding The Nonprofit’s Legal Form.



Unincorporated Association.

Testing Suitability For Tax-Exemption.

Why A New Nonprofit?

What Category Of Exemption?

How Is Money To Be Raised?

Will Insiders Benefit?

Where Will Assets Go?

Maintaining Recognition Of Exempt Status.

Role Of Internal Revenue Service.

Forms 990.

Other Filings.



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