A Graphic Re-visioning of Nonprofit Overhead

A Blog in Pictures (and some words, too)

Most nonprofit leaders agree that we need a new way to communicate about the true costs of our programs and the vital importance of strong organizational infrastructure.  But we have not yet developed a simple, consistent message when sharing our view with potential supporters and investors. We are stuck with old terms and old images.

Getting Past the Overhead Ratio

I made a presentation to a group of executive directors recently about how to communicate financial information in a way that supports mission, impact, and transparency. We talked a lot about connecting the dots from money to mission, and moving past the standard pie charts. Then a director said what everyone in the room had experienced. “After I speak with a group in our community about our great work, the stories of people we help, and the impact we have on their lives, someone always asks, “Yes … but how much do you spend on overhead?” Sigh.

Core Strength for Nonprofits: Financial Lessons from a First Time Marathoner

Over the past year I have been enthused by a newfound passion for long-distance running, which began innocently enough as a fifty-something guy cautiously running a mile and a half. While logging many miles since then, I’ve had time to reflect on parallels between my fledgling ardor for running and my long-established passion for nonprofit finance. Running buddies of mine, who are far more experienced in this realm, have taught me that developing core strength is a key to longevity in running. This lesson is true in the nonprofit world as well.

Clear the Fuzzy Thinking About Nonprofit Reserves

When I want to push nonprofit leaders to think about finances more comprehensively than their annual budget, I have a simple exercise that I use:

Imagine that a surprise gift arrives at your organization from a loyal and honorable donor, with no restrictions or strings attached, equal to 20% of your annual budget. What would you do with this windfall?

IRS 990: What’s in it for me?

When nonprofit organizations complete the IRS 990, the standard federal reporting requirement for nonprofit organizations, most probably aren’t thinking about how they will use the form. The 990 is essentially a compliance document, explaining to the IRS the mission, governance, program activities and financial situation of an organization for the prior year. The IRS uses the form to not only make sure the organization still exists, but also to check to see that the organization is meeting the rules for charities, and basically doing the things that it said it would do.

Mind the Gap: True Program Costs

Imagine this budget planning conversation at a human services nonprofit:

“The county wants to expand our contract! Isn’t that great?”

The easy answer is: Yes! We can provide more services in our community! But the smart answer is: It depends.  In this example, we’d need to ask ourselves a couple financial questions:

Déjà Vu All Over Again: Nonprofit Survey Results

Déjà Vu All Over Again: Nonprofit Survey Results
“It’s been a rugged three years for Minnesota’s nonprofits, years characterized by economic instability, management uncertainties, and fundamental shifts in a once-familiar external landscape. Still reeling from significant financial downturns, many nonprofits have used the last few years to take a long, hard look at their internal capacities and financial requirements.”

6 Takeaways From This Year's #npfinance

It’s been a couple of weeks since the 4th Annual Nonprofit Finance and Sustainability Conference that Nonprofits Assistance Fund co-hosts with Minnesota Council of Nonprofits, and I’m still thinking about the topics, questions, and discussions from that day. The conference could not have had a better start than the keynote from Rodney Christopher, a Director on the Capital Deployment Team at F.B. Heron Foundation, on building strong nonprofit enterprises. Rodney invited us all to “let our nonprofit finance geek flags fly” and then provided us with inspiration and aspiration, with a strong dose of reality.

Is your board on board with financial leadership?

Stephanie Jacobs writes about four concepts board members need to understand to be effective financial leaders.

Overhead – good, bad, or both?

In this blog post, Kate Barr responds to "The Overhead Myth" and poses some important questions for all of us to consider.