Build Your Fiscal Fitness: Insights from the Experts

Planning, planning, planning. It’s good advice in a lot of situations, but it’s especially important if you’re managing a non-profit organization on a limited budget.

Now, no one said it’s easy. But a new set of online tools from The Wallace Foundation and Fiscal Management Associates (FMA) does make it easier.

On Wednesday, CBASS and FMA hosted a webinar to introduce after-school organizations and their staff to these new tools, freely accessible via the site StrongNonprofits.org. “Build Your Fiscal Fitness: An Introduction to Strong Nonprofits” explored the concept of strategic financial management and offered participants tools and strategies to implement it.

The first thing out-of-school time (OST) organizations need to know about financial management is why it’s important. In 2007, The Wallace Foundation commissioned research on the management capacity of after-school organizations and, subsequently, a demonstration project in Chicago. From that work, said Wallace communications officer Nina Sonenberg, “It became clear that strengthening financial management is key to supporting afterschool program quality…If you can’t pay your electric bill and your lights go out, your program suffers.” It’s not a connection people make immediately or often, but understanding it is at the crux of your organization’s long-term health.

The second thing is to know what financial management is. Many of us think it means accounting, or being in compliance with funders, or making sure there is cash in the bank. While it is all of those things, financial management encompasses a much broader strategic function, allowing organizations to focus on effectively utilizing resources to achieve their mission. Hilda Polanco, founder and managing director of FMA, highlighted three essential practices:
1) Developing accurate, realistic budgets;
2) Monitoring the financial status of individual programs; and
3) Projecting and managing cash flow needs.

John Summers, manager of consulting at FMA, walked participants through a number of tools available on the StrongNonprofits site to assist with each of these aspects—notably, a program-based budget builder, a funding opportunity assessment tool (“Go or No Go”), and a cash flow projections template. The speakers repeatedly emphasized the importance of budgeting and tracking expenses by program rather than grant, as this helps organizations know whether they are operating a program at a surplus or deficit, articulate their program costs more clearly to a funder, and plan for the future.

Participants also had the opportunity to hear directly from one after-school intermediary organization about its experiences negotiating the challenges of financial management. Hillary Salmons, executive director of the Providence After-School Alliance (PASA), said that her organization had been fortunate to receive major support from The Wallace Foundation at its inception. Since then, however, PASA has taken an intentional approach to leveraging that funding for support from other sources, both public (city dollars and federal funds, e.g. School Improvement Grants, 21st Century Community Learning Center funds, Title I, and Career and Technical Education grants) and private (foundations and individual and corporate donors). Not only is this essential for an organization’s long-term viability, but in the case of an intermediary, it’s essential to the long-term viability of a city’s OST system.

Planning for your organization’s future financial health while operating its finances today is no easy task—especially if you’re a small or new organization with limited capacity. But tools like StrongNonprofits.org can help, and even a part-time financial officer or outside fiscal management company can assist in setting a vision and mapping out a plan for financial management. From there, educating your team—from the board and management on to community partners and program staff—will go a long way to keeping you fiscally fit.

Access a recording of Wednesday’s webinar at www.afterschoolsystems.org. You can also read a Q&A with Fiscal Management Associates about the resources available through StrongNonprofits.org.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s