Diana L. Sullivan, CPA, CGMA, Controller, Capitol Area Council, Boy Scouts of America

1. Tips & Tools for Great Financial Management
Diana L. Sullivan, CPA, CGMA
By PresenterMedia.com

2. Agenda
…and plan of attack!
1 Assess
Identify & prioritize needed improvements
2 People & Critical Resources
3 Policies, Procedures & Problem Busters
4 Routines that Work - Finance Calendar
Time Management Toolkit
5 Effective Budgeting
6 Powerful Reporting

3. Assess
Identify & Prioritize Needed Improvements
Rank critical areas to improve.
Reassess after going through
the presentation.
Accounting
Function Financial Position
Ask stakeholders to assess. Best Practices? What’s our improvement
Foster an atmosphere of Oversight?
focus?
transparency and willingness Internal Control?
to hear honest feedback.
Leadership
Planning
Board consensus
Effective budgeting
Great reporting
Contingencies covered
Focus on plan

4. People & Critical Resources
Essentials for Financial Success
• Accounting & • Leadership for fiscal • Outside
finance staff stewardship Relationships
• Integrity • Board commitment • Auditor
• Training • Reporting / • Banker
• Skills responding • Payroll processor
• Judgment • Focus on mission • Insurance broker
• Diligence • Transparency • Others

5. Policies, Procedures & Problem
Busters
Conflict of
Interest
• Critical Policies Whistleblower
• All NPTs need these key policies
• Annual adoption & follow seriously Peer Groups
• Critical Procedures Internal
Controls
• Key tasks kept up every single month
Document
Retention
• Problem Busters
• Use internal Controls to avoid big trouble
• Make month-end checklists
• Outsource payroll processing, if needed

6. The Financial Orbit
A Feedback Loop
The Budget is an earning and Plan and
spending plan to implement Budget
your strategic plan.
Great reports help
management make decisions.
Just like a detective follows the
evidence, managers follow
the financial evidence.
Financial
Cycle
You are responsible to report
to outside parties. Your
audited financial statements,
Audit, 990, Record,
annual reports, and form 990 Report,
Annual
are available to the Reports Correct
community, and stakeholders
“follow the money” and make
judgments about your
nonprofit’s effectiveness.

7. Finance Calendar
When Critical Tasks
Weekly Payment of obligations
Inspection of payroll, payables
Monthly Month-end close
Bank reconciliations
Account reconciliations
Variance analysis
Monitor Receivables
Board Meetings (Monthly) Board reports, variance reports
Mid-Year Begin budget building
Engage Auditor
Fall Finalize & adopt budget
Adopt policies & procedures as needed
Year-End Year-end close, audit prep, tax returns,
annual reports
Annually Strategic planning

8. Time Management Toolkit
Deal with the Enemy: Interruptions
Honestdiscussion management
& employees
Arrange quiet times
Music
Closed door
Work from home
Sign
“Do Not Disturb” on phone
Stay out of email, voice mail for
periods of time

9. Time Management Tools
BATCH the work
Everything
every day vs. batches
Some items have to be daily
Some items to batch
Payroll
Payables
Journal Entries
Phone Calls
Folders for Colleague Meetings
Difference
between “batched”
and “behind!”

10. Time Management Tools
Delegate – Learn to Train and Trust
Work with people’s strengths
Use non-accounting staff for
some items – might even
improve controls!
Find error-killer proofreaders

11. Time Management Tools
Checklists, Notes, and Cheat Sheets
Month-end close checklists
Manager’s “audit workpapers”
Templates for often-used jobs
Journalentries with account names
& codes but amounts blank
Budget templates
Alwayslook for “self-checking”
mechanisms
What We Did Last Year

12. Learn to Say NO
Everything in life has an opportunity cost!
Be deliberate about your time
“Materiality” - good enough,
not perfect
How to escape a phone call
How to escape a meeting
Fight reverse delegation
Look for great outsourcing
opportunities

13. Time Management Toolkit
Time-Saving Features In GL Software
Recurring journal entries
Automatic journal reversals
Saving report templates
Import and Export
Report Groups

14. Time Management Toolkit
Become “Bit Literate”
Clear emails daily
Use two monitors
Bit Literate “To Do” list
Outlook tools
Solve Puzzles
Explain problem to someone else
Revisit daily
Let subconscious work

15. Why is Budgeting so Powerful?
Financial Success is Tied to Effective Budgeting
Builds consensus
Reconciles conflicting priorities
Big picture activity
Measures performance
objectively
Creates structure for a rational
feedback system

16. Effective Budgeting
A Power Tool
Think of budgeting as part of
the planning process, just like
the strategic plan. Tying
budget to strategic plan also
helps “sell” it to your
stakeholders.
Involve all necessary Build Measure
individuals in creating the Strategic Budget Actual
budget (also helps you “sell” Plan with vs.
budget discipline). Team Budget
Measure actual results against
budget every month.
Revise the budget if necessary.
Hold people accountable for
their budgetary performance.

17. Create Key Measures
Start by Making a Wish
• If you could improve
your nonprofit
financially, what are the
big three items you’d
change?
• * Cash Position
• * Collection of pledges
• * Fund Balance
• * Inventory Turn
• * Membership
• * Service volume

18. Internal Reporting
Leaders Decide Based on Financial Facts
• Monthly Financial Reports
• Statement of Operations,
Financial Position, Changes in Net
Assets and Cash Flows
• Accountability
• Reportto each manager
• about his responsibility centers
•Key Measurements
1. * Your nonprofit’s most important
financial priorities
2. * Measures of non-financial
effectiveness

19. Internal Reporting
Leaders decide based on financial facts.
FINANCIAL STATEMENTS KEY MEASURES
• Statement of Operations • Key measures are different for
• Statement of Financial each non-profit.
Position • What critical areas do you
• Statement of Changes in Net need to improve?
Assets
• Statement of Cash Flows
TIP: Post financial statements so managers can see their results
monthly.

20. Reporting
Reports for Management and the Board
Revenues
Charts and graphs are
powerful reporting tools. Fundraising Grants Supply Sales Miscellaneous
Use charts and graphs for your
Key Measures – make sure
every piece of your board
presentation adds meaning.
58%
23%
9% 10%

21. Focus on Cash Position
Cash $ 16,564
Short Term Investments 35,206
Total Cash & Cash Equivalents $ 51,770
Less Accounts & Notes Payable (25,799)
Less Payroll Taxes Withheld (1,040)
Less Credit Accessed (16,603)
Actual Net Cash Position $ 8,327

22. Bar Chart to Show Variances
How are we doing compared to budget?
Expenses
Actual Budget
$10,213
$10,500
$2,212
$2,150
$8,410
$8,700
$1,680
$1,450

23. Focus on Capital Expenditures
PROJECT BUDGET ACTUAL VARIANCE
BRIDGE REPAIRS $ 13,000 $ 12,839 $ 161
FENCING 8,150 9,127 -977
PARKING LOT 3,530 5,350 -1820
SOD/IRRIGATION 2,750 1,912 838
LIGHTING 3,200 1,565 1,635
TOTAL 30,630 30,793 -163

24. Where to Get Help
Greenlights
Austin Chapter, Texas Society of
CPAs
Austin Nonprofit Financial Leaders
Group
SCORE
Texas Workforce Commission