Financial Management

Instead of focusing on basic accounting issues, our intervention is concerned with how financial decisions are made within the organization. Effective financial decision-making requires a decision support infrastructure that is in place to facilitate well-informed decisions across multiple constituencies. Moreover, the organization must have a strategy in place, which drives its thinking in this regard and ultimately improves the likelihood of overall financial sustainability.

Assessment Questions: What are our financial sustainability goals and objectives? Do we have all the financial reports needed to effectively run our organization? Do we truly understand program unit costs? Are we managed as a series of cost centers budgeted to lose money or is there some expectation of program self-sustainability? How do we track our revenue sources and what have been the trends over the past 3-5 years? What financial criteria do we use to take on new programs/products/initiatives? Do we reconcile mission importance against financial performance? Do we hold managers accountable for financial results? Have we made the appropriate investment in professional development to encourage effective financial decision-making?

Intervention: Development of financial goals and benchmarks to effectively monitor organizational performance and creation of tools including the possibility of some training modules to better inform financial decision-making.

Miscellaneous: It’s very difficult to professionalize the financial management function within an organization without having the in-house talent to effectively steward this process. Consultants have no shortage of ideas when it comes to how to do this work better, however the reality is that most organizations staff above their in-house talent levels. Bottom line is that there are very often minimal financial management capabilities beyond basic reporting requirements; a basic foundation of knowledge must be built before expectations can be raised.

Approach:  

• 1:1 interviews with senior team and board treasurer 
• Review financial reports and budget documents for last 3 years 
• Conduct basic ratio analysis and compare to industry benchmarks where possible 
• Review strategic and operational planning documents over past 3 years to reconcile with financial reporting documents 
• Conduct research of external benchmarks to uncover applicable performance measures 
• Conduct program and service analysis of all existing programs 
• Review and assess performance management process to vett alignment with financial objectives 
• Create financial management planning document that facilitates effective decision support and align organization behind consistent financial objectives 
• Create financial management team that includes cross section of management and key staff.