Mango Training for NGOs - key financial concepts and jargon

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This is a short module to share key concepts and jargon in preparation for financial management training for NGOs run by Mango. www.mango.org.uk.

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Mango Training for NGOs - key financial concepts and jargon

  1. 1. Financial management for NGOs Key concepts and jargon Advance thinking for Mango training www.mango.org.uk
  2. 2. So what is financial management? www.mango.org.uk
  3. 3. Take a moment to write down 3 or 4 thoughts on what financial management involves before moving to the next slide ... Go on when ready www.mango.org.uk
  4. 4. Financial management entails: our financial resources www.mango.org.uk
  5. 5. One way to think about financial management to an organisation is like maintenance to a car ... .. we need to put in good quality fuel and give it a regular service so that it will run efficiently. www.mango.org.uk
  6. 6. But if we neglect it, the car will break down and will not reach its intended destination. www.mango.org.uk
  7. 7. www.mango.org.uk
  8. 8.  Money is used properly  Assets are kept safe  Staff are protected  Managers can sleep soundly! www.mango.org.uk
  9. 9.  This is a simple project management cycle ... See if you can write down the equivalent of each stage in financial terms. www.mango.org.uk Review Go on when ready
  10. 10. Build in learning and take action Review Monitor the budget www.mango.org.uk Set the budgets Receive & spend project funds
  11. 11. Why is financial management important in our work?  What do you think? The next slides share ten good reasons  How many can you get? Go on when ready www.mango.org.uk
  12. 12. To be accountable to the people who give us money www.mango.org.uk
  13. 13. To be accountable to the people who give us money www.mango.org.uk To be accountable to the communities we work with
  14. 14. To be accountable to the people who give us money To be accountable to the communities we work with To provide financial reports for regulatory bodies www.mango.org.uk
  15. 15. To be accountable to the people who give us money To be accountable to the communities we work with To provide financial reports for regulatory bodies www.mango.org.uk To plan for the future and become more financially secure
  16. 16. To be accountable to the people who give us money To minimise fraud, theft and abuse of resources www.mango.org.uk To be accountable to the communities we work with To provide financial reports for regulatory bodies To plan for the future and become more financially secure
  17. 17. To enable staff to make better decisions on the use of funds www.mango.org.uk
  18. 18. To enable staff to make better decisions on the use of funds www.mango.org.uk To achieve the objectives of the organisation
  19. 19. To enable staff to make better decisions on the use of funds To achieve the objectives of the organisation To enhance the credibility of the organisation www.mango.org.uk
  20. 20. To enable staff to make better decisions on the use of funds To achieve the objectives of the organisation To enhance the credibility of the organisation To strengthen fundraising efforts www.mango.org.uk
  21. 21. To enable staff to make better decisions on the use of funds To get best value for our money www.mango.org.uk To achieve the objectives of the organisation To enhance the credibility of the organisation To strengthen fundraising efforts
  22. 22. A key feature of financial management is managing risk Two types of risk:  Internal – from within, which we can do something about  External – from outside so beyond our direct control www.mango.org.uk
  23. 23.  Financial risks pose a threat to our financial resources. Write down one internal and one external risk facing your organisation... Go on when ready www.mango.org.uk
  24. 24. Typical risks for NGOs:  Internal – theft, fraud, fire, accidental damage ...  External – exchange rate loss, donors withdrawing funds, inflation ... www.mango.org.uk
  25. 25. The key to good practice in financial management? Robust systems! www.mango.org.uk
  26. 26. There are four building blocks in a strong financial management system ... www.mango.org.uk
  27. 27. Accounting records  Books of account – ie the summary records  Supporting documents – ie the paperwork www.mango.org.uk
  28. 28. Financial planning  Budgets for operations  Financing strategies for long term planning www.mango.org.uk
  29. 29. Financial monitoring  Financial statements for external accountability  Budget monitoring reports for internal review www.mango.org.uk
  30. 30. Internal control  Policies & procedures  Checks & balances www.mango.org.uk
  31. 31. Financial control  When all the building blocks are set up and working effectively, we achieve financial control. www.mango.org.uk
  32. 32. Find out more about Mango and free resources for NGOs http://www.mango.org.uk/Guide www.mango.org.uk

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