How to do a
Fund Development Audit
Analyzing your organization through your fundraiser eyes
Gayle L. Gifford, ACFRE
This is a taste, not the
When to do an audit?
“… basic assumptions and norms
about how the organization
operated …had to be challenged
and changed ….
“In a number of cases … the
organization had been failing to
meet its fundraising targets for
several years … it was now
assumed that the target would
not be met and that it was
acceptable not to meet it.
“Such assumptions were
Adrian Sargeant and Jen Shang
Putting charitable giving in
Grant making public
From Giving USA 2012
The leaky bucket:
What to do to keep the
Keep the givers and
gifts you have
Replace what you lose
Grow givers and gifts
What is a whole organization
fund development audit?
of your organization and your
fundraising program with a goal
of strategic improvement.
From “Great Fundraising”
“In our view, what makes a fundraising leader truly
great is how they go about answering [this] question:
“How might all these existing systems be
transformed systematically such that great
fundraising may be created?”
How do I do it?
Thinking in time
Know your industry
Where to start
1. External Scan
Talk to people
2. Internal Scan
Talk to people
Prepare a SWOT
Fundraising Profile of Peer
Review the field
Reviewing a 990
National Center for Charitable Statistics
Get an outside perspective
People to interview
Know your market
Wealth/scarcity of institutional
by income for
zips 02818 and
Long term value of a donor (by
Donor acquisition and attrition
– New and returning donors
– Donors who have dropped out and not
– New donors
Increases or decreases in giving
Income by solicitation sources
Giver counts by gift range
Donation totals by gift range
Average gift trends
Geography or other demographics
What else to analyze
Mission & Program
Case for Support
Culture of Philanthropy & Leadership
Brand Identity & Communications
Fund Development Capacity & Infrastructure
Legal & Regulatory
Pull it all together into an analysis
Profile of Fund Development
Summary giving Profile
Comparison with Peers
Assets- Opportunities- Missing Pieces- Work
Arounds/Concerns by SWOT element
Findings from external research
The audit only matters if it guides
your fundraising plan
Mothball or abandon
Do more research
Lobby for needed
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How many of you have audited your fundraising program in the last three years? Did you do it yourself or with consultation?
Opportunities to do an audit include: Coming into a new positionLaunching a new program (e.g. major gifts, endowment, etc)Preparing for a campaignNeed a fresh lookFeeling stuck
To the “stuckness question” This new study lookedat a number of UK orgs that had doubled, tripled even quadrupled their fundraising. Worth reading. It’s not about technique, but about the leadership and organization development conditions that enabled success. I hear too often from organizations that have been suffering with little growth or success in their fundraising and have developed a mindset that they can’t do better.
This looks at the overall breakdown of nonprofit revenues. For smaller organizations, the mix is different, with Private contributions providing a greater share of the pie.
The leaky bucket of giving --
Again from AdrianSargeant’s analysis – what is a system? Major focus on Systems perspective: natural systems, designed physical systems (buildings), designed abstract systems (mathematics), human activity systems (organizations, teams)What systems affect the effectiveness of your fundraising program?
See Five Elements of Strategic Thinking http://www.ceffect.com/blog/strategic-thinking/five-elements-of-thinking-strategically/
What do you read – where do you go for information? Chronicle of Philanthropy, Stanford Social Innovation Review, Research, Professional Associations, Daily newspaper, NPR – fabulous,Organization development books – Reframing orgs, Leadership, Stewardship, Governance, Performance Measurement – I use Twitter to crowdfind important research
Part of the Statement of RevenueA major challenge in comparing is that not every organization classifies their income the same.
Note the fundraising events – another schedule that you can look at.
Other things you can find are endowment funds, expenses functionally broken down, sometimes salaries. Etc.
Because the 990 doesn’t differentiate types of contributions, you will have to look elsewhere. If you are lucky, the annual report of the organization will break their income out separately. You can request this, or some organizations post their annual reports and even their audited financial statements online. The idea is to collect a sample – both with like type of organizations, but other organizations that you think have a similar profile – maybe the same size fundraising department. Or organizations you aspire to be.
To compare yourself more broadly, can look at NCCS database, taken from Business Master File of IRS
These reports can help you figure out where you fit in the local landscape. You can see who the other organizations are by going to Guidestar and searching the list
In Guidestar advanced search, can also ask for state, size of organization, keyword, type of organization. Be careful of mistakes.Have no idea why the Vivian Porch Welfare League Trust is showing up. 2012 990 says address is in IL? Bank of America even in IL.
Why would you want to interview these segments of stakeholders? Be bold. Step out of your comfort zone if you can. You want to test some of the things I mentioned previously: How strong is your reputation – what are people saying about you? What are you known for? What is the impression of your programs? What are the trends/best practices in your program field – are you in alignment with them? How well know are you? What support is there in your organization for your fundraising activities? What do your donors consider the strong points of your programs? What is donor reaction to the various aspects of your fund development program? How strong is your donor communications program? Are you engaging donors at the level they would like to be engaged. What opportunities exist: e.g. funding needs, shifting interests?
Just how many people are there in your community? By age (most givers are older, right!) By household income – match to numbers, match to townsSource of data: US Census Bureau
Census is your friend. This is just a snapshot of two age groups.
Graph the data to see what it looks like. Go as far back as you have good data. Be careful of intervening events – you have to interpret this data yourself. Don’t assume, dig deep.
A SWOT analysis used in any kind of planning – it stands for strengths, weaknesses, opportunities, threats. But be serious about this. I haven’t met an organization that hasn’t said “great staff” Is this really true? A good read for you is “Good to Great” and “Good to Great and the Social Sectors” by Jim Collins. In his research he identified 5 aspects of greatness: Discipline peopled (right people in right seat, level 5 leadership), disciplined thought (confront brutual facts, hedgehog), Disciplined Action (culture of discipline, flywheel), Built to Last (clock building, preserve the core) These principles can help you in your analysis of these items – how well do you stack up?
I look at my SWOT somewhat differently – assets, opportunities, missing pieces and work arounds/concerns. You could call it AMOC. Do this for every segment of your data. Again, you are telling yourself a story here. This is just a snapshot of 3 of many categories.