GuideStar Webinar (08/27/13): The Ins and Outs of the NEW GuideStar
GuideStar Webinar (12/10/13) - Weaving Financial Data Into Your Nonprofit's Story
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Transcript of GuideStar Webinar (12/10/13) - Weaving Financial Data Into Your Nonprofit's Story
Scott Menzel Product & User Experience Manager GuideStar Peter Kramer Manager Nonprofit Finance Fund December 10, 2013
Weaving Financial Data Into Your Nonprofit’s Story: Interpretation and communication with Financial SCAN
AGENDA
Introduction to Financial SCAN
New Feature Overview
Brief Online Tour
Case Analysis
Q & A
Knowing which metrics to focus on for assessing financial health
Having the time and skills to collect, parse, and report financial data
Communicating your financial situation and resource needs
When it Comes to Finance, Nonprofits Face Common Challenges
Effective Solutions
Financial SCAN demystifies nonprofit data and illuminates nonprofit financial health, providing the field with knowledge and tools for building and sustaining healthy, effective organizations.
Sound Financial Health
Strong Organizations
Quality Programs
Financial SCAN: A New Analysis Filter on 990 Data
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 (313K orgs)
*Note: Financial SCAN does not include data from Forms 990 EZ
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
How are Nonprofit Leaders Using Financial SCAN?
To engage staff, board members, and funders in conversations about recent dynamics and current needs
To map visually the organization’s financial story
To benchmark against peer organizations, assessing financial similarities and differences within and across sectors, sizes and markets
To provide historical context to inform budgeting and planning
“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
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 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
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
REAL WORLD SKILLS
Dashboard: Income Statement
Dashboard: Balance Sheet
Peer Comparison Dashboard:
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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
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?
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.
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
Q&A
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Thank you! Peter Kramer
Manager, Advisory Services Nonprofit Finance Fund
617-204-9772 [email protected]
To learn more:
www.guidestar.org/financialSCAN