Robert Kusel works in creative funding solutions for nonprofits, instrumental in bolstering charitable sustainability. He is also dedicated to promoting youth soccer programs in his community. In the following article, Robert Kusel soccer delves into the crucial domain of financial literacy for nonprofits, unraveling the complexities that often accompany the pursuit of philanthropic endeavors, discovering the strategies that will fortify nonprofits and amplify their potential for positive change in our communities.
Non-profit organizations have played imperative roles in establishing healthy communities around the world. However, a
survey conducted by La Piana Consulting showed 73% of such entities experienced severely impacted monetary health due to the COVID-19 pandemic, showcasing the cruciality of raising financial literacy within these organizations.
Long-term sustainability for nonprofits rests on three factors — budgeting, financial planning, and transparent reporting. Healthy charities manage their finances for flexibility and stability, both today and in the future. Those without fail to battle through unprecedented turmoil, losing their footing in the ever-evolving fiscal year.
That said, Robert Kusel discusses how complete financial literacy does more than guide nonprofits through economic uncertainties. The benefits of such knowledge are all-encompassing, ranging from legislative compliance to accountability.
Robert Kusel Says That Nonprofit Organizations Should Take Financial Literacy Seriously
Ultimately, nonprofits must enhance their financial literacy to continue providing essential goods and services to communities that need them most. Without proper money management, donors would lose faith and operations would cease.
There's no denying the importance of non-profit financial literacy. Robert Kusel explains that while certain aspects may differ, all charities must educate their staff to reap the long-standing rewards of fiscal planning, compliance, and transparency.
Detailed Accounting: The Basics of Running an Organization
Charities don't run themselves, making detailed accounting crucial for the day-to-day operations. Whether it's tracking donations or ensuring expenses are covered, detailed records aren't just required for tax reasons, but also for management teams.
Robert Kusel also notes that financial literacy empowers teams to keep the records needed for everyday decision-making within the entity. Otherwise, there aren't any documents showcasing the amount of money available to the organization at any given moment.
Nonprofit Quarterly noted that financial dashboards display real-time insight on the financial health of a charity, allowing teams to figure out the necessary steps for long-term prosperity and highlighting the necessity of good monitoring systems.
Budgeting: For Making Value-Adding Decisions
Non-profit organizations often outsource expertise in various specialized purposes, including financial health. Robert Kusel says that while the average individual may deem this a smart decision, lacking financial literacy within the charity will render professionally produced budgets confusing for the team to decipher. Not to mention that some experts aren't well-versed in non-profit budgets. Therefore, they may miss certain categories.
As such, investing in financial literacy education for all staff enhances their understanding of where money should be spent, guaranteeing they prioritize specific projects and operating costs. Plus, Robert Kusel soccer notes that adequate budgets let charities keep their tax designations below less-than-desirable thresholds.
Transparency: Telling the Nonprofit's Story Through a Monetary Eyepiece
Financial transparency is the cornerstone of trust in the eyes of non-profit organizations. As the term given to the processes/practices of allowing potential investors to clearly understand the business's economic health, financial transparency can only be achieved with a great deal of financial literacy.
Robert Kusel reports that nonprofits who provide such training to their staff members, particularly those working in finance departments, boast a few core advantages:
Investment
Investors and risks are a fickle pairing, with many shying away from charities without strong economic track records. They want to know nonprofits have positive cash flow that guarantees operational continuance, even in dire situations. Thus, financial transparency can be the difference between an entity securing investment and failing to attract investors.
Accuracy
It can even help internal accounting processes. A transparent environment keeps departments on the same page, ensuring employees catch reporting errors immediately.
Reputation
Robert Kusel highlights that a positive reputation goes a long way for nonprofits — it's how they spread their mission and attract monetary support. Financial transparency helps them secure this five-star status, cementing entities' seriousness in achieving their objectives.
Compliance: Charities Must Adhere to Tax Laws
Nonprofit or otherwise, organizations must adhere to certain tax and other laws set out by the state and US government. Typically, these laws revolve around money, making financial literacy crucial for guaranteed compliance.
Planning: Expecting the Unexpected
Robert Kusel explains that charities receive funding from multiple sources. Whether in-person fundraising efforts or through donors, they must keep track of how their money is coming in and where it's going.
When conducted accurately, nonprofits can make better decisions for the future, instead of relying on short-term purchases to see themselves through. Reducing costs without sacrificing core functions is possible only through economic planning.
Financial literacy does more than save money for nonprofit organizations – it ensures longevity and secures investments.
