Scott Menzel
Product & User Experience Manager
GuideStar
Peter Kramer
Manager
Nonprofit Finance Fund
June 5, 2014
Actionab...
AGENDA
Introduction to Financial SCAN
New Feature Overview
Brief Online Tour
Case Analysis
Q & A
Effective Solutions
Sound Financial Health
Strong Organizations
Quality Programs
We believe that financial health
supports...
When it comes to finance, nonprofits face
common challenges
 Knowing which metrics to focus on for assessing
financial he...
Financial SCAN at a Glance
What: Data platform for assessing nonprofit financial
health and fostering dialogue among all s...
What’s in a Financial SCAN?
Organizational Dashboard: Five
years of key financial trends and ratios
Graphs & Explanatory T...
How are Nonprofit Leaders Using
Financial SCAN?
 Engaging staff, board members, and
funders in conversations about recent...
Financial SCAN 2.0: New Features!
 Excel Download
 Peer Group Comparison
 7 Day Nonprofit Access
Brief Online Demonstration
Key Considerations: What 990 data can and
cannot do
990 data CAN help:
 Illustrate your organization’s financial trajecto...
Meet Today’s Case Organization:
REAL WORLD SKILLS
 MISSION: To prepare underserved youth for lasting
careers and self-suf...
REAL WORLD SKILLS
Dashboard: Income Statement
Dashboard: Balance Sheet
Peer Comparison Dashboard:
1 2 3 4 5 6
1 2 3 4 5 6
1 2 3 4 5 6
1 2 3 4 5 6
1 2 3 4 5 6
Topics Explored in Financial SCAN
Graphs:
 Expense detail & composition
 Revenue detail & composition
 Profitability
 ...
With the exception of 2008, surpluses
and deficits have been close to breakeven
RWS has effectively managed this growth by...
RWS’s liquidity has fluctuated somewhat over
the period, but has been consistently tight
Available liquidity represents a ...
Observations & Recommendations for
REAL WORLD SKILLS
Observations from Financial SCAN:
 Modest growth over last several y...
Q&A
nonprofitfinancefund.org 20
Thank you!
Peter Kramer
Manager, Advisory Services
Nonprofit Finance Fund
617-204-9772
peter.k...
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Actionable Financial Analysis: Insights for Nonprofit Leaders

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Actionable Financial Analysis: Insights for Nonprofit Leaders

In an increasingly data-filled world, it can be difficult to sort through proliferating information to find what matters most. Nonprofit finance is no different. And because healthy finances enable social impact, much is at stake in clearly articulating nonprofit financial condition and resource needs. How can nonprofit leaders make sense of financial data to create a clear picture of their organization's financial situation?

Join Nonprofit Finance Fund and GuideStar to learn more about Financial SCAN and how this data platform can add value to planning and decision-making conversations.

Presenters: Peter Kramer, Manager, Nonprofit Finance Fund; and Scott Menzel, Product & User Experience Manager, GuideStar USA (moderator)

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Actionable Financial Analysis: Insights for Nonprofit Leaders

  1. 1. Scott Menzel Product & User Experience Manager GuideStar Peter Kramer Manager Nonprofit Finance Fund June 5, 2014 Actionable Financial Analysis: Insights for Nonprofit Leaders
  2. 2. AGENDA Introduction to Financial SCAN New Feature Overview Brief Online Tour Case Analysis Q & A
  3. 3. Effective Solutions Sound Financial Health Strong Organizations Quality Programs We believe that financial health supports impact
  4. 4. When it comes to finance, nonprofits face common challenges  Knowing which metrics to focus on for assessing financial health  Having the time and skills to collect, parse, and report financial data  Communicating about an organization’s financial situation and resource needs
  5. 5. Financial SCAN at a Glance What: Data platform for assessing nonprofit financial health and fostering dialogue among all stakeholders involved in making social impact Who: Private and public grantmakers/donors, nonprofit organizations, philanthropic advisors, consultants and media How: Private and public grantmakers/donors, nonprofit organizations, philanthropic advisors, consultants and media WHAT Data platform for assessing nonprofit financial health, making data driven decisions and informing grantmaker-grantee dialogue WHO Nonprofit organizations, private and public grantmakers, individual donors, philanthropic advisors, and consultants HOW Draws data directly and automatically from IRS Forms 990,* presenting complex information in an easy-to-analyze and communicate format (350K+ orgs) *Note: Financial SCAN does not include data from Forms 990 EZ
  6. 6. What’s in a Financial SCAN? Organizational Dashboard: Five years of key financial trends and ratios Graphs & Explanatory Text: More detailed overview of an organization’s:  Expenses  Revenue  Profitability  Balance Sheet  Liquidity Peer Comparison Dashboard: Select peer organizations for financial benchmarking
  7. 7. How are Nonprofit Leaders Using Financial SCAN?  Engaging staff, board members, and funders in conversations about recent dynamics and current needs  Visually mapping the organization’s financial story  Providing historical context to inform budgeting and planning  Benchmarking with peer organizations, assessing financial similarities and differences within and across sectors, sizes and markets “My organization never thought about strategically and proactively planning its financial future until I presented them with Financial SCAN. Executive Director, Diversified Community Services, Philadelphia, PA
  8. 8. Financial SCAN 2.0: New Features!  Excel Download  Peer Group Comparison  7 Day Nonprofit Access
  9. 9. Brief Online Demonstration
  10. 10. Key Considerations: What 990 data can and cannot do 990 data CAN help:  Illustrate your organization’s financial trajectory and recent revenue, expense, and balance sheet dynamics  Show how your organization compares to its peers across standardized fields 990 data CANNOT:  Provide the authoritative and most up-to-date financial picture of your organization  Tie exactly to the information presented in an audit  Show revenue restrictions  Distinguish between operating dollars and capital dollars
  11. 11. Meet Today’s Case Organization: REAL WORLD SKILLS  MISSION: To prepare underserved youth for lasting careers and self-sufficiency  PROGRAMS:  Personal & professional skill-building  Summer internship placement  Trade programs and certifications  RECENT DYNAMICS:  Steady yet modest growth  New location and dated equipment  Beginning strategic planning process
  12. 12. REAL WORLD SKILLS
  13. 13. Dashboard: Income Statement
  14. 14. Dashboard: Balance Sheet
  15. 15. Peer Comparison Dashboard: 1 2 3 4 5 6 1 2 3 4 5 6 1 2 3 4 5 6 1 2 3 4 5 6 1 2 3 4 5 6
  16. 16. Topics Explored in Financial SCAN Graphs:  Expense detail & composition  Revenue detail & composition  Profitability  Full cost of doing business  Asset composition  Depreciation of fixed assets  Liability composition  Liabilities as a % of assets  Liquidity
  17. 17. With the exception of 2008, surpluses and deficits have been close to breakeven RWS has effectively managed this growth by consistently covering its operating costs to achieve marginal surpluses But are surpluses adequate to build financial resilience?
  18. 18. RWS’s liquidity has fluctuated somewhat over the period, but has been consistently tight Available liquidity represents a nonprofit’s ability to handle risks and seize new opportunities.
  19. 19. Observations & Recommendations for REAL WORLD SKILLS Observations from Financial SCAN:  Modest growth over last several years  Reliable mix of revenue sources  Relative to peers, little fixed assets  Tight liquidity constrains ability to innovate Recommendations for Leadership:  Make business planning a part of strategy development; build on historical strengths (e.g., reliable revenue, surpluses in most years, etc.)  Consider amount and types of capital needed to build liquidity and adapt to the changing job market  To meet resource needs, discuss areas of fiscal strength and vulnerability with funders
  20. 20. Q&A
  21. 21. nonprofitfinancefund.org 20 Thank you! Peter Kramer Manager, Advisory Services Nonprofit Finance Fund 617-204-9772 peter.kramer@nffusa.org To learn more: www.guidestar.org/financialSCAN

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