Tosha Anderson, CPA’s Post

𝙎𝙩𝙧𝙖𝙩𝙚𝙜𝙞𝙚𝙨 𝙛𝙤𝙧 𝙈𝙖𝙣𝙖𝙜𝙞𝙣𝙜 𝙍𝙚𝙨𝙩𝙧𝙞𝙘𝙩𝙚𝙙 𝙖𝙣𝙙 𝙐𝙣𝙧𝙚𝙨𝙩𝙧𝙞𝙘𝙩𝙚𝙙 𝙁𝙪𝙣𝙙𝙨 𝙞𝙣 𝙉𝙤𝙣𝙥𝙧𝙤𝙛𝙞𝙩𝙨 Nonprofits are the unsung heroes of our communities. But managing their funds can be a major challenge. I know firsthand the complexities they face. Balancing restricted and unrestricted funds is like walking a tightrope. Yet, when done right, it can transform an organization's impact. Here's how nonprofits can successfully navigate this financial landscape: 𝗨𝗻𝗱𝗲𝗿𝘀𝘁𝗮𝗻𝗱 𝗙𝘂𝗻𝗱 𝗥𝗲𝘀𝘁𝗿𝗶𝗰𝘁𝗶𝗼𝗻𝘀 → Restricted funds come with strings attached. They're designated for specific purposes, like a donor stipulating their gift be used for a new building. ↳ Unrestricted funds, however, offer flexibility. They can cover everyday expenses or unexpected costs. 𝗖𝗿𝗲𝗮𝘁𝗲 𝗮 𝗖𝗹𝗲𝗮𝗿 𝗣𝗼𝗹𝗶𝗰𝘆 → Develop a policy that details how funds should be managed and allocated. This ensures transparency and builds trust with stakeholders. 𝗥𝗲𝗴𝘂𝗹𝗮𝗿 𝗠𝗼𝗻𝗶𝘁𝗼𝗿𝗶𝗻𝗴 → Keep a close eye on both restricted and unrestricted funds. Regular audits and reviews will help track spending and compliance. 𝗘𝗱𝘂𝗰𝗮𝘁𝗲 𝗬𝗼𝘂𝗿 𝗧𝗲𝗮𝗺 → Ensure everyone in the organization understands the difference between the funds. This fosters informed decision making. 𝗘𝗻𝗴𝗮𝗴𝗲 𝗗𝗼𝗻𝗼𝗿𝘀 → Communicate openly with your donors. Help them understand the importance of unrestricted funds for operational flexibility. 𝗙𝘂𝘁𝘂𝗿𝗲 𝗣𝗹𝗮𝗻𝗻𝗶𝗻𝗴 → Use unrestricted funds strategically. They can serve as a buffer during lean times or be used for strategic investments. Remember, every dollar counts toward your mission. By mastering the balance between restricted and unrestricted funds, nonprofits can maximize their potential. This financial acumen not only secures the organization's future but also amplifies its ability to create meaningful change. 𝙇𝙚𝙩'𝙨 𝙨𝙪𝙥𝙥𝙤𝙧𝙩 𝙤𝙪𝙧 𝙣𝙤𝙣𝙥𝙧𝙤𝙛𝙞𝙩𝙨 𝙞𝙣 𝙩𝙝𝙚𝙞𝙧 𝙟𝙤𝙪𝙧𝙣𝙚𝙮 𝙩𝙤 𝙛𝙞𝙣𝙖𝙣𝙘𝙞𝙖𝙡 𝙝𝙚𝙖𝙡𝙩𝙝 𝙖𝙣𝙙 𝙨𝙪𝙨𝙩𝙖𝙞𝙣𝙖𝙗𝙞𝙡𝙞𝙩𝙮. What strategies have you found effective in managing funds? Share your thoughts below! https://lnkd.in/eSrnyNZ6 #NonprofitFinance #FinancialManagement #FundAccounting #NonprofitTips #RestrictedFunds #UnrestrictedFunds #NonprofitLeadership #MissionDriven #FinancialHealth #SustainableNonprofits #CommunityImpact #NonprofitSuccess #DonorEngagement #Transparency #NonprofitSupport #FinancialPlanning #NonprofitBestPractices

Small nonprofits often struggle with limited resources and funding, making it crucial to have appropriate budgets in place. A general operating budget is essential for covering overhead expenses such as rent, utilities, and salaries, ensuring the organization's sustainability. On the other hand, budgeting for each program or project allows for a clear allocation of funds, enabling the nonprofit to track the impact and effectiveness of its initiatives. By having separate budgets, nonprofits can better manage their finances and demonstrate transparency to stakeholders. Ultimately, having well-planned budgets is key to the success and longevity of any nonprofit. #NonprofitBudgeting #FinancialTransparency #Sustainability #Budgets #financialtransparency

💡 Top 4 KPIs Every Nonprofit Should Track for Success 💡 Effective financial management is essential for every nonprofit to achieve its mission. Here are the top 4 KPIs every nonprofit should be tracking: 1. Program Efficiency Ratio: This measures how much of your expenses are dedicated to programs and services vs. admin costs. A higher ratio builds donor trust and attracts funding. 2. Donor Retention Rate: Understanding how many donors are returning year after year is crucial for sustainability. Retaining 10% more donors can drastically cut fundraising costs. 3. Fundraising ROI: Track how much you’re raising for every dollar spent on fundraising efforts. High ROI means your fundraising is effective and efficient. 4. Operating Reserve Ratio: This tells you how many months your nonprofit could operate without new income. A strong reserve provides financial stability during uncertain times. Are these KPIs part of your nonprofit's strategy? Comment below! For personalized guidance on optimizing your KPIs, schedule a free consultation at www.thejcamillellc.com. #NonprofitKPI #CFOInsights #NonprofitFinance #MissionDriven #NonprofitSuccess #FundraisingTips #ImpactMeasurement #NonprofitLeadership #GrantWriting #SocialImpact

A nonprofit’s finances can change quickly—especially if a major funder discontinues support.   In 2022, US nonprofits saw a 10% decrease in donor participation. Creating a reserve plan becomes an important way to mitigate risk amid this uncertainty.   Han Group partner and CPA Janet McDaid outlines three tips for nonprofits considering a reserve plan for the first time. Read here: https://lnkd.in/eTykrYGM

State and Local Fiscal Relief funds, which are part of ARPA, are currently accessible. However, they are anticipated to be returned to the federal government by the close of 2024. This linked article outlines recommendations for nonprofit organizations on how to access these funds. #NFP#ARPA https://lnkd.in/ekS3ZgEa

"We exceeded our fundraising goals, but I still can't sleep at night." This confession from a nonprofit Executive Director managing $2.8M in annual grants revealed a common challenge in the sector. Our firm's review of 100+ nonprofits exposed a critical pattern: organizations excel at raising funds but struggle with financial clarity. The impact? Mission-driven work becomes vulnerable to financial uncertainty. What we consistently uncover in our nonprofit reviews: - Grant compliance issues hiding in standard bookkeeping - Program costs misaligned with funding restrictions - Cash flow gaps between grant payments - Board reports missing key sustainability metrics - Restricted funds accidentally used for operations The most resilient nonprofits we work with implement systematic tracking across: - Restricted vs. unrestricted funds - Program-specific costs - Grant compliance metrics - Operating reserves - Donor retention economics - Cash flow forecasting The difference? These organizations sustain their mission through funding changes, maintain donor trust, and expand their impact with confidence. Your nonprofit changes lives. We ensure your financial clarity matches your mission impact. #Nonprofits #ExecutiveDirectors #MBSATA

Changes in government funding can have significant impacts on nonprofit budgets. When government grants or subsidies are cut or altered, nonprofits may need to quickly adjust their financial strategies. This can involve seeking alternative funding sources, reducing operational costs, or modifying program offerings. Additionally, shifts in government priorities can affect long-term planning and sustainability, making it crucial for nonprofits to have flexible and adaptive budgeting practices to manage these uncertainties effectively. This situation requires nonprofits to be proactive in monitoring funding trends and preparing for potential changes. #strategicplanning #financialmanagement #nonprofitsuccess #resourceallocation #nonprofitfinance #impactfulnonprofits #sustainablenonprofits #budgetingforchange #nonprofitgrowth #cnrgaccountingadvisory

Numbers are just numbers. Or are they? In nonprofits, they transform into stories of change. Let me share a journey. Years ago, a small nonprofit approached us at the brink of closure. Their mission was noble, but their numbers didn't reflect their impact. We stepped in and saw more than just figures. We saw potential. With disciplined accounting, we helped them uncover the hidden narrative. Each dollar spent became a chapter in their success story. Their story, once buried under spreadsheets, emerged as a tale of hope and resilience. Today, they're thriving, impacting lives more than ever. The numbers told a story. And they believed in it. Accounting isn't just about balance sheets. It's about breathing life into your mission. So, to every nonprofit, remember: Behind every figure, there's a story waiting to be told. What story will you tell today? #NonprofitImpact #PurposeDrivenFinance #StoryBehindTheNumbers #AccountingForChange #MissionDrivenAccounting #FinancialStorytelling #FinanceForGood #EmpoweringNonprofits #ImpactThroughNumbers #BeyondBalanceSheets #NumbersWithPurpose #NonprofitSuccess #TransformingCommunities #ResilientNonprofits #PurposeInNumbers

The relationship between Form 990 and nonprofit fundraising is significant and multifaceted: 1. Transparency and Trust: Form 990 provides a public record of a nonprofit's financial activities and operational practices. When potential donors and grantmakers can easily access and understand a nonprofit's financial health, program expenses, and executive compensation, it builds trust and credibility. 2. Demonstration of Impact: Nonprofits can use Form 990 to showcase their program achievements and how they allocate funds. 3. Compliance and Eligibility: Regular and accurate filing of Form 990 helps maintain a nonprofit's tax-exempt status. Losing this status due to noncompliance can severely impact an organization’s ability to fundraise, as contributions would no longer be tax-deductible for donors. 4. Marketing and Public Relations: Although primarily a tax document, Form 990 can serve as a marketing tool. Nonprofits can highlight their successes and efficiency in the form's narrative sections, such as the Statement of Program Service Accomplishments. 5. Strategic Planning: Insights gained from preparing and reviewing Form 990 can help nonprofits identify strengths, weaknesses, and opportunities. Overall, the relationship between Form 990 and nonprofit fundraising is deeply intertwined, with the form serving as a key document that impacts a nonprofit's reputation, donor trust, compliance status, and strategic direction. #form990essentials #nonprofittransparency #irscompliance #nonprofitfinances #charityaccountability #financialtransparency #nonprofiteducation #990filing #nonprofitguidance #taxexempttips #cnrgaccountingadvisory

𝗨𝗻𝘃𝗲𝗶𝗹𝗶𝗻𝗴 𝗛𝗶𝗱𝗱𝗲𝗻 𝗟𝗲𝗴𝗮𝗹𝗶𝘁𝗶𝗲𝘀 𝗼𝗳 𝗗𝗼𝗻𝗼𝗿 𝗙𝘂𝗻𝗱𝘀 Understanding the difference between 𝙍𝙚𝙨𝙩𝙧𝙞𝙘𝙩𝙚𝙙 & 𝙐𝙣𝙧𝙚𝙨𝙩𝙧𝙞𝙘𝙩𝙚𝙙 𝙁𝙪𝙣𝙙𝙨 in Nonprofits 🔍 Nonprofits often juggle 𝘙𝘦𝘴𝘵𝘳𝘪𝘤𝘵𝘦𝘥 & 𝘜𝘯𝘳𝘦𝘴𝘵𝘳𝘪𝘤𝘵𝘦𝘥 𝘍𝘶𝘯𝘥𝘴, but what does this mean, and why is it crucial? 𝗞𝗲𝘆 𝗜𝗻𝘀𝗶𝗴𝗵𝘁𝘀: ✏️ Restricted funds are set aside for specific purposes dictated by donors, and cannot be used for other expenses (Foundation Group, 2023). ✏️ Only donors can impose restrictions; internal designations by the nonprofit do not create legally restricted funds (Foundation Group, 2023). ✏️ Separate accounting for restricted and unrestricted funds is essential to maintain accurate financial reporting and compliance (Smith-Howard, 2023). ✏️ Noncompliance with fund restrictions can lead to serious repercussions, including legal action and damage to the nonprofit's reputation (Investopedia, n.d.). 🤔 𝗤𝘂𝗲𝘀𝘁𝗶𝗼𝗻𝘀 𝘁𝗼 𝗣𝗼𝗻𝗱𝗲𝗿: 1. How does your nonprofit manage and account for restricted vs. unrestricted funds? 2. Have you faced any challenges with fund compliance? 𝗣𝗿𝗼 𝗧𝗶𝗽𝘀: 💡 Use dedicated tools to track restricted funds accurately. 💡 Maintain open communication with donors about how their contributions are being utilized. How does your organization manage restricted donations? 💬 𝘚𝘩𝘢𝘳𝘦 𝘺𝘰𝘶𝘳 𝘦𝘹𝘱𝘦𝘳𝘪𝘦𝘯𝘤𝘦! 🩵💰🩵 #bcs #nonprofit #FundManagement #Donations #Compliance #Accounting #NonprofitFinance #FundTracking #GrantTracking #NonprofitManagement #FundAccounting #DonorRelations #FinanceTips #DonorTrust #Transparency #FundingPurpose #FinancialManagement #NonprofitAccounting #NonprofitBookkeeping