Dashboards: How to create and implement one relevant to your nonprofit Washington County Nonprofit Network December 7, 2016

Transcription

1 Dashboards: How to create and implement one relevant to your nonprofit Washington County Nonprofit Network December 7, 2016

2 Agenda Finance Committee and Board of Directors reporting Pitfalls of Dashboards Benefits of benchmarking & dashboards Metrics & key ratios for nonprofits Tips for a good dashboard How to assess your nonprofit Working with MJ s dashboard tool test

3 Board Reporting Recommendations Finance Committee Detailed Balance Sheet Detailed Income Statement Budget to Actual Cash Flow Projection or Forecast Dashboard (financial and programmatic) Board of Directors Summarized Balance Sheet Summarized Budget to Actual Income Statement Dashboard (financial and/ programmatic) 3

4 Board Reporting Recommendations Management Detailed Balance Sheet Detailed Income Statement Budget to Actual Cash Flow Projection or Forecast Dashboard (financial and programmatic) 4

5 Dashboards High level concise graphical presentation Key Performance Indicators (KPI; metrics that impact the business) Used to track key ratios Track trends over time Include program, development and financial Attributes of KPI s Measurable and available Impact the organization Relevant Timely 5

6 Keys to a good dashboard Align with organizational success Communicate timely analytics Snapshot of current status and trends over time Simple to read and uses white space Graphical with easy labels; communicate numerical data easily Legible font size Stop light coloring or smiley faces/frown faces 6

7 Pitfalls of Dashboards Too many details Tracking wrong benchmarks Focus on numerical data only Crowded and distracting Charts and labels marked separately Font too small Too many colors 7

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11 Selecting ideal KPI s Program or business driver Reflect progress toward intended goals Guides decisions Assessed periodically to determine right fit *Handout* Compass Point Library of Sample Dashboard Indicators 11

12 How to get started Discuss metrics/kpi s with group to use the dashboard Evaluate KPI s and determine range of desired outcomes Draft a pilot dashboard for several months and evaluate Create final version Evaluate periodically 12

13 Key Ratios Financial Days Cash on Hand How long can current cash cover daily expenses with no additional inflows Cash / (annual expenses noncash expenses / 365) Current Ratio Are current assets sufficient to cover current liabilities? Current assets / current liabilities Net Asset Reserves How many months of reserves do you have? (Total unrestricted net assets net assets of PPE perm restricted) / (Total expenses/12) 13

14 Key Ratios Financial Revenue Allocation What are your sources of revenue? Revenue type / total revenues Program Expenditures What % of annual expenses go toward programs? Program expense / total expenses 14

15 Key Ratios Program Program effectiveness How many clients are you serving? Total clients served compared to budget/goals Program effectiveness What is the satisfaction of clients? Program efficiency Are staff maintaining 100% of workloads? 15

16 Key Ratios Development Fundraising efficiency How much does it cost to raise a dollar? Contributions / total fundraising expenses Fund development Are we bringing on new major donors? Are we retaining major donors? Grant request win rate Are we able to secure funding from written grant requests? 16

17 Nonprofit Benchmarks Functional Expense Ratios National Averages Charity Navigator 2016) approx: Program = 81.5% Management = 9.3% Functional Expense Ratios (Portland Metro for all nonprofit types Charity Navigator 2016): Program = 81.4% Management = 8.8% 17

18 MJ Dashboard Sample Tool Easy to use input boxes Dashboard automatically updates graphs Stop light color coding 18

19 Off track discussion needed Finance Committee Dashboard Arts4More On track March 2015 Caution discussion suggested Program Development *should be monthly (Annual) March 2015 Donor March 2015 YTD % YTD Budget Top Donations: Individuals 948 John Doe Children served 325 1,106 29% 6,874 Corporations 10,000 Target Foundations 15,000 Oh My! Foundation Paint used 9,000 6, % 12,000 Average Donation $ 35 Voluteer hours 3,000 6,000 50% 12,000 # New Donors 4 Grant success ratio 53% Financial Revenue Expenses 120, , , , , , , ,000 50,000 Actual Budget 100,000 80,000 60,000 40,000 20,000 Actual Budget March 2015 YTD Budget Expenses by Program March 2015 Current % Goal % Total Cash Income 576, , ,224 Color for Kids 345,320 41% 44% Total Cash Expenses 273, , ,250 Healing art program 241,680 28% 30% Net Change 302, , ,974 Education program 100,349 12% 8% Total Program 687,349 81% 82% Management 62,889 7% 8% Assets Fundraising 100,993 12% 10% Total Expenses 851, % 100% Previous Month Current Month 285,430 64,745 80, ,537 78,419 80, , ,297 Cash Receivables Inventory Other In Kind Gifts March 2015 YTD Supplies 42, ,927 Facilities 5,000 15,000 Marketing 2,304 6,384 Other 40,700 40,700 90, ,011

20 Nonprofit Dashboards Your Org What ratios are relevant? Questions to consider: How do we know if we are fulfilling our mission? How do we track our fundraising efforts? How do we know our revenues are on track? How do we know our expenses are on track? 20

21 Proposed Reporting Changes Phase I Liquidity Disclosures on managing liquid resources available to meet cash needs for expenses within one year Disclosures quantifying amount of assets available for expenditure within one year Final illustrations and examples to be included in future ASU 21

22 Proposed Reporting Changes Phase I Operating Measure Enhancement to reporting requirements when non profits choose to present measures Requirement of reporting internal board designations and appropriations on the face of the financial statements 22

23 Proposed Reporting Changes Phase II Expenses discussion of disclosure over functional basis (program, management, fundraising) Operating measures require measures, defining measures Cash flows realignment of certain items 23

24 Questions 24

25 Contact Information Gerard DeBlois Jessica Yoder