A simple guide to financial sustainability

How to protect your charity’s finances 

According to the report, “The first step in transforming finance is adopting an easier, more flexible chart of accounts”. This improves visibility, making it far easier for charity finance professionals to spot patterns, identify risks, and see impact.  

Being able to see impact is particularly important, since it allows charities to communicate that more quickly to employees and donors, using relevant and up-to-date statistics to bring their mission and goals to life. 

The report suggests charities use techniques to make your data more flexible visually, such as using hashtags. Hashtags are used on social media in order to find content along a similar theme easily . Hashtags works precisely the same in accounting, bringing together relevant information in one place, as and when you’re looking for it. 
 

Understanding your financial data is vital for helping charities understand their progress as an organisation, but alone, it is only half of the picture. The report suggests that financial data is better understood alongside statistical data specific to your organisation, such as number of event bookings, donors, and more.  

The report lists what counts as financial data (income statement, balance sheet, budget-to-actuals) and what is thought of as statistical data (headcount, services delivered, hours billed). Working together, these can form your outcome metrics that help form your goals and define your impact to donors.  

The report refers to one charity who were able to tell their story to long-term funders in a way that was backed up with data, allowing them to show the results of their strategy and advocate for it among their supporters.  

Whether in an economic downturn or experiencing a boom, one thing charities are always short on is time. While automation is all over the news in terms of Artificial Intelligence, there are ways that charities can make use of technology now to free up their time, become more flexible and increasingly efficient.  

With the newfound flexibility that investing in digital provides, charities can not only focus more time on their mission, but also be confident that they are looking after their funds – never more important than when the world’s economic situation remains precarious. 

To find out more about good digital financial stewardship, click the link below and download the guide from Sage Intacct.