All posts by Melissa Boulette

When should your nonprofit organization reconsider a special event?

Not-for-profits use special events to raise large amounts in a short period of time. Most often, the donor receives a direct benefit from the event — such as dinner or participation in a gaming activity. But special events don’t always meet their fundraising goals. In fact, organizations can lose money on them. Following these steps can help boost your event’s potential and enable you to decide whether to hold it again in the future.

Step 1: Make a budget

Planning and holding a successful event is a process that should start with a budget. Estimate what you anticipate revenue to be. If costs are likely to be greater than revenue, consider forgoing the event. Of course, you can also come up with a less costly event or look for sponsors to help defray expenses.

Step 2: Develop a marketing plan

Determine the target audience for your event and the best way to reach that audience. For example, bingo nights are often popular with seniors. And they may be more likely to read about the event in the local newspaper than on your nonprofit’s blog.

Step 3: Account for everything

Track all of your event’s costs to arrive at an accurate net profit amount. For example, a gala’s costs could include:

• Amounts paid to market the event, such as printed invitations and paid advertisements,
• Amounts paid related to the direct benefit that the participant receives, such as food, drinks and giveaways, and
• Other actual event costs, such as rental space and wait staff.

Step 4: Evaluate the event

After the event, review a detailed statement of its revenue and expenses, and compare them to what was budgeted. Take a look at ticket sales: Did you bring in the amount you had anticipated? Was the attendance worth the amount of planning and organizing that went into the event? Next, evaluate money raised at the event itself. How much did your silent auction or raffle raise? Did you make more than the fair market value of the items donated?

Also review unexpected expenses. Were these “one-time” or “special” costs that aren’t likely to occur yearly, or are they recurring? The answers to these questions can help you determine if the event was a true success.

Crunching the numbers

Consider these results — along with changes in your organization and evolving economic conditions that could affect profitability — when determining whether your event is likely to be successful in the future. If you’re unsure, contact our reputable professionals at Perry, Fitts, Boulette & Fitton CPAs. We can help you crunch the numbers.  207-873-1603

 

© 2018

Why nonprofits might want to revisit the Donor Bill of Rights

The Donor Bill of Rights was designed about 25 years ago as a blueprint of best practices for not-for-profits. Some critics have since asserted that the rights are out of date or not comprehensive enough. However, revisiting the list’s basic principles can help you build solid relationships with donors — and even boost fundraising.

Here are the rights and what they might mean for your nonprofit:

1. To be informed of the organization’s mission, how it intends to use donated resources and its capacity to use donations effectively for their intended purposes. This information is the bedrock of your outreach efforts and should be clear to your board, staff and anyone reading your organization’s materials.

2. To be informed of who’s serving on the organization’s governing board, and to expect the board to exercise prudent judgment in its stewardship responsibilities. You must be transparent about who serves on your board, their responsibilities and the decisions they’re making.

3. To have access to the organization’s most recent financial statements. Make your nonprofit’s financial data easily accessible to constituents, potential donors and charitable watchdog groups.

4. To be assured gifts will be used for the purposes for which they were given. Donors expect that you’ll minimize administrative expenses so their funds are available for programming and that you’ll honor any restrictions they’ve placed on gifts.

5. To receive appropriate acknowledgment and recognition. In addition to thanking donors, provide them with the substantiation required for a federal tax deduction and information about the charitable deduction rules and limits.

6. To be assured that donation information is handled with respect and confidentiality to the extent provided by law. Post your organization’s privacy policy on your website and be clear about what information you’re gathering about donors and how that information will be used.

7. To expect that relationships between individuals representing organizations and donors will be professional. Staff and board members should be trained in proper donor interaction — both off- and online.

8. To be informed whether fundraisers are volunteers, employees of the organization or hired solicitors. Again, transparency about your operations is critical.

9. To have the opportunity for donors’ names to be deleted from mailing lists that an organization may intend to share. Donors, not your nonprofit, get to decide whether their information can be shared. Make it easy for donors to opt out of email and other lists.

10. To feel free to ask questions and receive prompt, truthful and forthright answers. Open dialogue between your nonprofit and your donors fosters respect and deepens relationships.
Contact us for help implementing these 10 tenets or developing a customized donor bill of rights.

 

Our firm, Perry, Fitts, Boulette & Fitton CPAs work with an extensive amount of nonprofit organizations.  Reach out to us if you have any questions.  We’re happy to help.  Contact us at 207-873-1603 or visit one of two locations at 259 Front Street, Bath or 46 First park Drive, Oakland.

© 2018

PFBF CPAs “Run the Numbers” 5K & Kids Fun Run to raise funds for the Camp Tracy Campership Fund: The Harold Alfond Foundation to match every dollar raised

The PFBF CPAs “Run the Numbers” 5K & Kids Fun Run started in 2010 and raised $1,700 for charity. Eight years later the race has grown in numbers, bringing in over $100,000 for various Maine charities thanks to their participants and generous community sponsors.

This year, all proceeds will go to the Alfond Youth Center’s Camp Tracy Campership Fund. The funds will help send area youth to Camp Tracy where children are taught team building, leadership, and independence skills through a wide variety of daily activities while having a positive social experience. The Harold Alfond Foundation has agreed to make a matching donation for every dollar raised.

Be a ‘Champion for a Camper” at this year’s race!

The 9th Annual road race will be on Saturday, June 16th which begins and ends at the office of Perry, Fitts, Boulette & Fitton CPAs (PFBF CPAs) on 46 First Park Drive in Oakland. The Kids Fun Run, free for kids 12 & under, starts at 8:30 a.m., followed by the professionally timed 5K Run/Walk which starts at 9:00 a.m. Youth and student rates are available.

Kids Fun Run starts at 8:30 a.m.

Cash prizes will be given to the top three Overall Female/Male finishers as well as the top male and female finishers in each category. There will be a post-race party with music, food and drinks. Mac Dickson of 92 Moose will return for his 6th year as the Master of Ceremonies.

 

Register Here! For questions and more info, contact Race Director, Melissa (Sawyer) Boulette at msawyer@pfbf.com or 873-1603.

 

Spring cleaning: Review your nonprofit’s programs — and possibly replace some

Has your not-for-profit’s program lineup remained unchanged for at least a couple of years? If so, consider using the tradition of spring cleaning to review your offerings. Some of your programs might be due for replacement.

Clear out the closets

Many nonprofits keep programs long after they’ve stopped working. Instead of relying on old assumptions about their effectiveness, perform new research. Start by surveying participants, members, donors, employees, volunteers and community leaders about which of your nonprofit’s programs are the most — and least — effective and why.

You may get mixed responses regarding the same program, so consider their source. Employees and volunteers who work directly with program participants are more likely to know if your current efforts are off target than is a donor who attends a fundraising event once a year.

Right tool for the job

If you don’t already have goals for each program, you need to set them. Also put in place an evaluation system with metrics that are strategic, realistic and timely. For example, a charity that provides tutoring to high school students in low-income neighborhoods might measure the program’s success by considering exam and class grades and graduation rates as well as the students’ and teachers’ feedback.

Apply several measures, including subjective ones, before deciding to cut or fund a program. Numerical data might suggest that a program isn’t worth the money spent on it, but those who benefit from the program may be so vocal about its success that eliminating it could harm your reputation.

Shiny and newer

It’s usually easier to identify obsolete programs than to decide on new ones. If one of your programs is clearly ineffective and another is wildly exceeding expectations, the decision to redeploy funds is simple.

Keep in mind that new programs can be variations of old ones, but they must better serve your basic mission, values and goals. Also, no matter how much good programs do, they can’t be successful if they overspend. For every new program, make a tight budget and stick to it. You might want to start small and, if your soft launch gets positive results, simply revise your budget.

It takes a team

Even if it’s clear to you and your staff which programs must go, some stakeholders may object to your proposals. Handle these individuals — particularly donors — with care. Let us know how we can help.  We can be reached at msawyer@pfbf.com or 207-873-1603.

© 2018

Making The Most of Your Nonprofit’s Internal Audit Function

The key role of a not-for-profit’s internal auditors was once limited largely to testing financial and compliance controls and reporting their findings to the organization’s leadership. But today, with their cross-departmental perspective, internal audit staff (whether employees or outside consultants) can help anticipate and mitigate a variety of risks, improve processes — and even help evaluate your nonprofit’s strategies.

Core job

On its most basic level, the internal audit function provides independent assurance of compliance with a nonprofit’s internal controls and their effectiveness in mitigating financial and operational risk. Potential risks include fraud, insufficient funds to support programming and reputational damage.

Internal auditors start by identifying a nonprofit’s vulnerabilities and prioritizing them from high to low. Through testing and other methods, they then assess the effectiveness of internal controls. Auditors document their results in reports that include recommended improvements.

Internal auditors further evaluate compliance with laws, regulations and contracts. They follow up on management’s remediation actions to eliminate identified risks and assist external auditors, when applicable.

The effectiveness of the internal audit function hinges on auditor independence. Auditors should be independent from management and all areas they review to avoid bias or a conflict of interest. Auditors should report directly to the board of directors or its audit committee.

Expanded function

Although the internal audit function is often viewed mainly through the prism of compliance and internal controls, it has a lot to offer beyond risk assessments and audit plans. Savvy nonprofits have begun to tap internal audit for strategic purposes.

Auditors may serve as internal consultants, providing insights gathered while performing compliance and assessment work. For example, while reviewing invoices, internal auditors may discover a way to streamline invoice processing.

The internal audit function’s familiarity with the organization’s inner workings also affords it an unusual perspective for evaluating strategic opportunities. Does your nonprofit have a financial weakness that could undermine plans for continuing current programs or launching new ones? Your internal auditor probably knows the answer.

Ask for more

Increased public scrutiny of how nonprofits are governed and held accountable makes an effective internal audit function a must. But internal auditors can offer your nonprofit more than financial and compliance oversight. To ensure you’re making the most of this function, contact our audit team at 207-873-1603.  Ask for Gary Smith, CPA or Danielle Martin, CPA.

© 2018