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Financial Management Best
Practices
Weyrich, Cronin & Sorra, Chartered
presented by:
Kelli Miller, CPA - Partner
To protect the confidential and proprietary information included in this material, it may not be disclosed or provided to any third parties
without the approval of Weyrich, Cronin & Sorra, Chartered.
Certified Public Accountants & Business Consultants
1301 York Road ~ Suite 800 ~ Lutherville, MD 21093 ~ 410.339.6464139 North Main Street ~ Suite 201 ~ Bel Air, MD 21014 ~ 410.838.2237
202 East Pulaski Highway ~ Elkton, MD 21921 ~ 410.398.1833www.wcscpa.com
Weyrich, Cronin & Sorra, Chartered
WHY IS IT IMPORTANT TO PAY ATTENTION TO FINANCES?
Weyrich, Cronin & Sorra, Chartered
Building block for managing all aspects of the Organization: programs, capital assets, human resources, fundraising…..
WHY ARE WE HERE TODAY?
Weyrich, Cronin & Sorra, Chartered
Most Organizations have room for improvement in
financial matters.
WHAT IS THE FIRST STEP?
Weyrich, Cronin & Sorra, Chartered
Set an appropriate tone at the top regarding financial practices.
WHOSE RESPONSIBILITY IS IT TO ESTABLISH GOOD FINANCIAL PRACTICES?
Weyrich, Cronin & Sorra, Chartered
Governance
• is legally accountable for the entity including its financial well being
Management via authority delegated by Board
• Executive Director
• Financial Personnel
WHAT IS THE STRUCTURE OF A GOOD BOARD?
Weyrich, Cronin & Sorra, Chartered
• Board
• Finance Committee
• Audit Committee
• Board Treasurer
WHAT ARE THE ATTRIBUTES OF A GOOD BOARD?
Weyrich, Cronin & Sorra, Chartered
• Dedication to best practices
• Diversity in composition
• Processes for addressing issues
• Board rotation
• Meeting schedule
• Maintain minutes
• Written policies
• Flexibility to adapt
BOARD FUNCTIONS VERSUS MANAGEMENT FUNCTIONS
Weyrich, Cronin & Sorra, Chartered
• Board - oversight
• Management – Execute day to day
Executive Director
Finance Manager (contingent on size and budget)
Bookkeeper (contingent on size and budget)
BUILDING A FOUNDATION
Weyrich, Cronin & Sorra, Chartered
• Cash or Accrual?
• NPO Generally Accepted Accounting Principals reporting
Unrestricted
Board designated
Temporarily restricted
Permanently restricted
BUDGETS
Weyrich, Cronin & Sorra, Chartered
Operating
• Expenses
• Revenue
• Key budgeting concepts
Capital
INTERNAL CONTROL
Weyrich, Cronin & Sorra, Chartered
• Defined as the processes and procedures which an organization implements for the purpose of safeguarding its assets
• Imperative for all organizations
• Developed and tailored to the specifics of the organization
PRACTICAL CONTROLS FOR ALL ORGANIZATIONS
Weyrich, Cronin & Sorra, Chartered
• Tone at the top• Cash controls• Accountability• Physical controls/limited access• Whistle blower• Mini audits• Credit card controls• Training• Compliance reviews
BASIC POLICIES
Weyrich, Cronin & Sorra, Chartered
• Record retention
• Conflict of interest
• Whistle blower
• Gift acceptance
• Private inurement
• Investment
FINANCIAL CONCEPTS AND BENCHMARKS
Weyrich, Cronin & Sorra, Chartered
• Indirect costs• Cash flow concerns• Internal interim financial statements• Unrestricted net asset balances• Budgets to actual• Key metrics and ratio analysis• Diversity in support• Compensation matters• Comparison to peers• Internal trends• Transparency is the key!
EXTERNAL FINANCIAL REPORTING
Weyrich, Cronin & Sorra, Chartered
• Audits• Tax filings• Grantor reports
EXTERNAL RESOURCES
Weyrich, Cronin & Sorra, Chartered
• Google• Monitor Guidestar and/or
other public nonprofit sites• MANO• SPAN• Debbie’s Faith Based NPO
Resource Center
Weyrich, Cronin & Sorra, Chartered
Leave your card if you would like us to send you a ‘Checklist for Reading and Understanding the Financial Statements’ and detailed slides from the presentation.
For more information contact:
Certified Public Accountants & Business Consultants
1301 York Road ~ Suite 800 ~ Lutherville, MD 21093 ~ 410.339.6464139 North Main Street ~ Suite 201 ~ Bel Air, MD 21014 ~ 410.838.2237
202 East Pulaski Highway ~ Elkton, MD 21921 ~ 410.398.1833
www.wcscpa.com
Weyrich, Cronin & Sorra, Chartered