Breaking down the numbers – Tune up your board’s financial literacy
Abstract: A not-for-profit organization’s board of directors has a mix of talents. So how can a nonprofit best share its financial results with the board members who are not financial experts as well as with those who are? One method is to use graphs and pie charts instead of long lists of numbers. Another is to provide a cash flow analysis, along with ratios that allow the board to see if the organization’s costs and revenues are in line with its expectations. And it may be helpful to provide the financial training appropriate for serving the needs of a nonprofit. A sidebar to this article provides a description of some common financial terms.