10 tips for sharing nonprofit financial information with any audience
Discover the ten tips for nonprofit organisations for sharing financial information with any audience.
Financial reporting is a crucial work product of the nonprofit accounting team.
Reporting delivers value in the areas of compliance, analysis, planning and strategy, and organizational transparency.
Accurate, easy-to-understand reports and dashboards help instill confidence when you are communicating with the Board and donors/funders.
Sharing financial management information across a nonprofit organization is essential for fostering trust among stakeholders.
When teams share access to performance data, they collaborate more effectively and enjoy more data-driven program planning and resource allocation.
Overall, sharing financial management information cultivates a culture of openness and accountability, ultimately strengthening your organization’s effectiveness and sustainability.
In this article, we’ll provide ten tips for sharing nonprofit financial information with any audience and explain how having a cloud nonprofit accounting solution provides easier reporting and enhanced visibility.
Here’s what we’ll cover
- Tip 1: Understand your audience for reporting
- Tip 2: Consider your delivery strategy
- Tip 3: Choose an appropriate cadence of insight
- Tip 4: Deliver insights that matter
- Tip 5: Speed time to insights
- Tip 6: Provide easy access to supporting documentation
- Tip 7: Take the reins with custom reports and dashboards
- Tip 8: Generate additional context with benchmarks
- Tip 9: Turn insights into action with storytelling
- Tip 10: Spot trends, identify outliers, and predict future results
- Final thoughts
- About the author
Tip 1: Understand your audience for reporting
Consider the needs and capabilities of your audience before designing reports, dashboards, or visualizations for them. First, is the audience internal or external?
Next, what expectations do they have about nonprofit financial information?
For example, board members might expect a certain grouping and format of information.
If you want to change a long-standing report package, walk your audience through the ‘why’ behind your new reporting and listen to their feedback.
Finally, consider how financially-minded your audience is and present the information with as much at-a-glance cognition as possible.
By creating different role-based dashboards, you can tailor information to the needs of each audience, from program managers and executives to auditors or the board of directors.
Add visual effects to dashboards, such as graphs and up and down trend arrows, to provide at-a-glance cues for people who may not have a solid financial background.
Tip 2: Consider your delivery strategy
How will you deliver nonprofit financial information?
Will you distribute a regular series of reports through email or make them available in a central location?
Again, this will depend a bit on your audience. Some people need to receive reports because they won’t go looking for them on the network.
Instead of receiving reports, would your audience prefer a self-service experience where they can get information whenever they want?
Dashboards are an excellent vehicle for self-service information.
You can also use a combination approach.
You would schedule automated reports to go out regularly but also make a self-service option available.
Executives and board members could receive reports and log in and drill down for more detailed information if they have additional questions.
Tip 3: Choose an appropriate cadence of insight
How often will your team need to provide reporting?
Is it needed on a routine basis, or is it a one-off exercise, such as reporting about a specific project?
That will impact how you deliver the information and how often you deliver it.
Consider whether your audience needs access to real-time figures or would be better served by periodic data that has been blessed.
For example, do you prefer to report on data only after it’s gone through the month- or quarter-end close?
Tip 4: Deliver insights that matter
Distributing reporting data aims to deliver helpful insights to stakeholders who drive mission impact.
However, distilling the insights that matter most to the mission is essential.
Including outcome metrics in financial reports and dashboards provides vital insights into program success and informs program adjustments and strategic planning.
Combining financial and statistical metrics within the same reports and dashboards gives decision-makers a more holistic view of performance.
For instance, having a real-time view of cost per meal or revenue per member could provide valuable insight for quick decision-making.
They can connect financial expenditures directly to program results, enhancing accountability.
This emboldens decision-making and ensures financial resources are directed toward the most impactful activities.
Tip 5: Speed time to insights
If you discern meaningful insights but fail to deliver them promptly, stakeholders may be unable to make significant changes to improve mission impact.
Dashboards and data visualizations help to speed up time to insights in several ways:
- Dashboards from cloud nonprofit accounting solutions display real-time data and enable continuous monitoring of key performance indicators. Real-time visibility enables more timely decisions than backward-looking reports.
- Visualizations render complex information in an easy-to-understand format, allowing users to quickly grasp the meaning behind the numbers.
- Many financial management solutions enable you to set reports to alert you when thresholds are exceeded, or data anomalies occur.
- Graphs and charts allow you to visually compare different periods or different programs at a glance.
By helping viewers grasp the important insights from financial and operational data more quickly, dashboards and visualizations enhance efficiency, clarity, and collaboration.
Tip 6: Provide easy access to supporting documentation
When nonprofits do their accounting and financial management in the cloud, it is easier to distribute reporting and analysis across the organization.
Accessing the raw data beneath the insights is also more accessible by employing reports and charts with drill-down capabilities.
Having the ability to drill down directly from reports into supporting documentation and source data helps improve organizational insight and decision-making in several ways:
- Get a top-level view with nonprofit KPIs and visualizations, then drill down to open more detailed reports.
- Focus your dashboard or chart on the data points that matter most while ensuring users can easily navigate to other information.
- Spot trends visually, then explore the detailed data to gain a deeper understanding.
Tip 7: Take the reins with custom reports and dashboards
Creating a set of customized reports and dashboards for your organization can help you optimize mission alignment by ensuring the best collaboration and staff empowerment.
Customizing your reports and dashboards lets you create insights tools that perfectly reflect your organization’s mission and activities.
This results in reporting that is relevant to each user’s specific needs, resulting in increased stakeholder engagement and improved decision-making.
Many nonprofit finance professionals feel intimidated by custom reporting, but there is nothing to dread if you have an easy-to-use report writing tool in your nonprofit financial management solution.
For example, the Sage Intacct Interactive Custom Report Writer is a modern, visual reporting tool that helps users build customized reports quickly and easily with hierarchical field selection, drag and drop, automatic formatting, and simple subtotals.
Additionally, Sage Intacct makes it easy to build customized, role-based dashboards for different staff members, managers, executives, auditors, and the Board.
Tip 8: Generate additional context with benchmarks
When you aim to improve mission impact, it helps to have other data to compare with your results.
Of course, most organizations carefully scrutinize current results against past performance. However, industry benchmarks also provide essential context and comparative insights.
Comparing your data against nonprofit industry benchmarks can help you identify areas of weakness and strength in your performance, assess risks, analyze industry trends, and set goals for improvement.
The Sage Intacct Nonprofit Digital Board Book is a set of pre-built dashboards that automatically track your real-time data against industry-wide best practice metrics to help nonprofit organizations benchmark financial health and sustainability.
Sage Intacct seamlessly calculates reports and dashboards using real-time balance sheet, revenue, and expense data from Sage Intacct, incorporating additional operational data sources such as donor management systems, budgeting and planning software, payroll, and more.
Tip 9: Turn insights into action with storytelling
Nonprofits operate in an environment of rich data; the challenge lies in effectively communicating data insights to donors, board members, and employees.
Sifting through spreadsheets to find the nuggets of insight won’t work.
Stakeholders need to be guided through the data with engaging narratives and visuals.
Narrative and visual storytelling help turn insights into action.
Good storytelling contextualizes the data, helping users understand why each metric and observation is important to mission success.
It simplifies complex topics, getting to the heart of the matter and clarifying priorities.
Stories capture attention and engage viewers emotionally, making them more likely to act on the data findings.
Visualizations illustrate mission impact, while narratives highlight both challenges and opportunities.
Tip 10: Spot trends, identify outliers, and predict future results
Financial management solutions equipped with visualizations can enhance the ability of management and the Board to quickly see patterns and trends in revenue, expenses, and cash flow.
Visual charts make it easier to detect outliers and anomalies in your financial data, such as rapid drops in funding or spikes in expenses.
Picking up on these changes early helps decision-makers investigate causes and adjust to changes more quickly.
Advanced nonprofit financial management software also helps leaders use historical data with predictive analytics features to examine potential what-if scenarios and forecast future results.
For example, Sage Intacct Interactive Visual Explorer empowers users to explore financial data more deeply using multi-angle, multi-dimensional analysis, spotting trends and outliers, and making predictive analytic insights about the future.
Final thoughts
Improving financial visibility across your organization helps build a culture of openness, transparency, and accountability.
To achieve the best mission alignment, it is important to share information that is accurate, insightful, actionable, and accessible.
That means customizing information delivered to different roles within the organization, presenting it in an easy-to-digest format, and providing context and narrative that makes it more useful to the viewer.
The ten tips shared in this article can help your organization improve the quality and accessibility of your financial information.
A cloud financial management solution like Sage Intacct helps nonprofits automate reporting and distribution of reports while enhancing understanding through dashboards, visualizations, and more.
Learn more by downloading the Secrets to Gaining Visibility into Nonprofit Financials e-book.
About the author
Nancy Master
Nancy Master is a senior nonprofit industry marketing manager at Sage Intacct and is passionate about helping nonprofits achieve mission success.
With more than 15 years of experience in software marketing, Nancy has close to 20 years of experience working with a human services nonprofit organization
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