Budgeting Strategies for Non Profits
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Budgeting Strategies for nonprofit organizations to use in tight economic times. Information provided by nonprofit accounting firm, Tate & Tryon, Washington DC.
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Budgeting Strategies for Non Profits
- 1. Budgeting in Tough Times Jay Sciuto Partner Tate & Tryon, CPAs y ,
- 2. Budgeting in Tough Times g g g The purpose of this presentation is to discuss effective b d i steps and provide cost cutting ff i budgeting d id i tips which could be helpful in tough economic times. i
- 3. Good Budget Characteristics Good Budget Characteristics A budget is a planning tool that should be: * R li i sound and reasonable assumptions Realistic- d d bl i * Flexible- adapt if there are significant changes p g g * Consistent- in line with assumptions and goals
- 4. Successful Budget Steps Successful Budget Steps Determine timeline: • Establish dates for milestones • Earlier the better • Allow time for analysis/edits
- 5. Successful Budget Steps Successful Budget Steps • Establish responsibilities . Determine who has the overall responsibility . Identify each program’s requirements . Ensure Board’s involvement and approval d’ l d l
- 6. Successful Budget Steps Successful Budget Steps • Establish goals and assumptions . Identify key program/organizational goals . Establish financial expectations . Communicate and d d document budget b d assumptions
- 7. Successful Budget Steps Successful Budget Steps • Analyze current and past budgets . Determine areas of risk . Identify items for possible cuts . Learn f from the mistakes of the past h k f h
- 8. Successful Budget Steps Successful Budget Steps • Key points in budgeting revenue . Justification for projections (increases/decreases) . Ensure that individual revenue line items are in line with overall assumptions . Identify areas of risk
- 9. Successful Budget Steps Successful Budget Steps • Key points in budgeting expense . Justification for expenses on a line by line basis . Ensure that individual items are in line with overall assumptions . Identify items that could be further reduced if future cut backs are required
- 10. Successful Budget Steps g p • Budget Implementation . Organizational wide buy-in . Monitor throughout year and focus on risks identified . Modify budget as necessary
- 11. Expense Reduction Tips Expense Reduction Tips The remainder of the presentation is to provide cost cutting tips that you can implement today without j i l d i h jeopardizing the di i h integrity of the programs you provide to your members and the general public
- 12. Expense Reduction Tips Expense Reduction Tips • Comparison to /dialogue with similar organizations . Employee benefits . Vendors used . Expense ratios . Expectation for future periods
- 13. Expense Reduction Tips Expense Reduction Tips • Looking within the Organization . Outsourcing options . Salary analysis . Ensure authorization l l f check requests. h levels for h k . Preventive measures for fraud
- 14. Expense Reduction Tips Expense Reduction Tips • L ki Looking outside the O t id th Organization i ti . Fee reduction options with current vendors p . Require multiple bids on all new products/ services above certain threshold . Bring certain functions in-house
- 15. Expense Reduction Tips Expense Reduction Tips • Offi space Office . Telecommuting option reduces office space g p p . Sub-lease opportunities for unused space . During downturn in real estate, lock in space at reduced rates