3 Reports You Need To Have (Even If Your Software Doesn’t) | npENGAGE

3 Reports You Need To Have (Even If Your Software Doesn’t)

By on Feb 13, 2014


Can you manage a nonprofit organization using just a balance sheet and income statement? I guess it’s possible that you can, but that’s like using a cue stick to play tennis – much harder than it has to be, and your results will be substandard.

All of our transactions will impact our balance sheet or income statement, sure, but there are a number of different ways we can approach those transactions, or “slice and dice” that data, to give you better insight into how your business is performing, manage your database, or remain accountable to your donors or other funders.

Consider how these 3 reports can help you manage your organization:

1. Revenue, Expenses, and up-to-date Net Assets for each of your programs or initiatives

It’s not enough to be able to report on just current-year revenues and expenses that are designated for particular programs.

Since grantor, donor restrictions, or designations aren’t removed when a fiscal year ends, it’s important to always have visibility into the total remaining to be spent for a given program – revenues less expenses for the current year, plus net assets rolled forward from previous years.

The best option is a nonprofit accounting software package that will include a calculation for “Total Net Assets, as of Today” when executing an income statement; otherwise, you may have to use formulae in Excel to make this happen.

2. A report showing the interplay between funding source and program

While it’s certainly possible that you have a one-to-one relationship between the programs you run and the grants or donor activity that funds each of those programs, it’s more likely that your programs are (or could be) each funded by multiple grants, and you’ll probably want to have multiple solicitations triggering gifts to the same cause.

If that’s the case, you’ll need to have a report that displays your revenue and expenses from two angles, simultaneously: the programs that are being funded, and the grants and/or appeals and events that are doing the funding. You’ll need to be able to consider this data from both directions: “Program A is funded by Grant 1 and Grant 2”, and “Grant 1 is funding Program A, Program B, and Program C”.

This allows you to remain accountable to your grantors and, if you consider your fundraising appeals and events in the same light, to better analyze your fundraising efforts (“The Direct Solicitation raised $20,000 for Program A, while the Golf Tournament raised $30,000 for Program A, but their respective nets were $18,000 and $15,000, making the Direct Solicitation a better option”, for example).

3. Subledger Reconciliation Reports

Many nonprofits struggle when trying to reconcile the outstanding invoices in Accounts Payable and/or Accounts Receivable to the respective summary accounts in the General Ledger. There are several software settings and business practices that can contribute to this difficulty; manually journaling to the summary accounts, being careless with reversal dates for voided checks, or leaving information in the subledgers unposted, for example.

The most common issue from a reporting standpoint is simply having too many reporting options! Think about an Open Invoice report in your Accounts Payable system – you may have the option to filter the report by Invoice Date, Creation Date, Transaction Date, and Post Date, any of which may affect the total you compare against (hopefully!) the same date in your General Ledger.

How do you know which to choose?And once you’ve settled on which, how do you know what to choose as the appropriate date?

All these options are necessary and helpful when you’re trying to examine the data in the subledger itself, but they can actually act as a hindrance when you’re just trying to determine whether the open invoice total matches the General Ledger total. The best nonprofit accounting software packages will give you a pre-built Reconciliation Report within these subledgers, which take away all the guesswork as to which options are “correct” to select for the goal you’re trying to accomplish.

What are your favorite reports for managing your organization? Share below.




Jonathan Howell is the Principal Consultant for Financial Solutions at Blackbaud. He has been working in the industry for nine years, and has been concentrating specifically on Financial Solutions for seven. His primary focus at Blackbaud is to improve the customer experience with The Financial Edge, from purchase through implementation and support. He’s a resident of Charleston, South Carolina and an active member and volunteer at East Cooper Baptist Church. He holds a Bachelor of Arts degree in Communications and a Business minor from the University of South Carolina, Aiken.

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