We’ve done some talking before about the importance of non-profit financial statements. In case you need reminding (or don’t want to click on the link, which maybe hurt our feelings just a little bit), here’s what you need to know. Nonprofit financial statements are the equivalent to what a balance sheet is for a for-profit enterprise. Essentially, it informs about the non-profit’s net assets by showing the difference between assets and liabilities. These may not be the most fun things to read (or put together) but they are incredibly essential. As such, it is really important — one might say critically important — to make that information publicly available. The people have a right to know where to find non-profit financial statements, and they should have easy access to that information in the digital age. If you want to know more, keep reading.
For all your non-profit financial and reporting needs — whether advice about financial statements or the best budgeting software — look to Questica. We have years of expert financial experience, and our mission is to help make your job easier! If you want to know more about us, check out our website. You’ll find lots of great tips and advice to get you started with your budgeting and reporting needs.
Why make it accessible?
If you’re new to the sector, you may ask yourself why it is important that the public know where to find non-profit financial statements. The short answer is: accountability. Think of it this way: would you give even a small amount of money if you thought it might be used for illegal or corrupt reasons? Probably not! Your donors are the same way — except they of course have much fatter wallets. This isn’t to say that they’re bad or stingy, just cautious. They certainly have reason to be: major nonprofits may continuously preach benefitting humankind, but that doesn’t mean they’re exempt from scandals and corruptions. So do yourself a favor and make the information easier on your donors. At the end of the day, are keeping secrets really worth the loss of credibility?
How to make it accessible?
Well, the nice thing about this is you can make it accessible without too much legwork on your end. Non-profits fill out Form 990 (shorthand: Tax Exempt form), then the IRS is required by law to make that information available. The non-profit should also make the information available to anyone who asks. The thing is, people probably won’t even ask the non-profit directly. That’s because there’s a way better and easier solution: third-party sites which post the Form 990 info for every NPO. These sites are GuideStar and The Foundation Center. It doesn’t matter whether you are starting an NPO or working with one, these two sites are incredibly good resources. They have a lot of great advice, in addition to showing where to find non-profit financial statements.
So since it’s so easy to do, why not make your non-profit financial statements easily accessible? And when it comes to budgeting and forecasting software, why not turn to Questica’s non-profit software? We have excellent software the eliminates the frustrations of forecasting and streamlines financial planning. The time you save will amaze you! To learn more about Questica, go to our website or you can also request a demo for yourself!
We also recommend our module, OpenBook that enables your organization to share and communicate your financials and other data in real time. This transparent and data visualization tool is great for communicating strategic plans and disclose your information to your donors. It’s a win all around!