Creating an Annual Report for Your Nonprofit

//Creating an Annual Report for Your Nonprofit

Creating an Annual Report for Your Nonprofit

If your nonprofit’s fiscal year ends June 30 it’s time to start thinking about your annual report. Since an annual report for your nonprofit is not required by law, you may be asking yourself if this is a step you can just skip. However, even if it sounds burdensome, there are many good reasons to produce an annual report. And, your board of directors may require it.

A well written annual report lets your sponsors, foundations, and possible new donors know where your nonprofit has succeeded in the past year. It’s also the best way to introduce interested donors to your company and give thanks to those that already support you. It provides transparency into your finances and gives your board important financial information.

 

Finances

Your supporters want to know that their money is being put to good use so it is crucial to include information about how it was spent. Nonprofitmarketingguide.com says that while it’s okay to put the full financial statement it may be best to stick with a few charts. Often your audience just wants a summary. Displaying this information with charts makes the information more concise and cuts back on any potential misinterpretations. It also saves on paper if you’re printing the report.

Consider whether to use audited or unaudited financial statements. Again, your board may have certain requirements about this. Your financials are unaudited if they have not gone through an independent verification and review process. If you use unaudited information, be open about it.

 

Show, Don’t Tell

Your sponsors want to know what you’ve been up to for the past year. As a fiction writer will tell you, show your audience–rather than just telling them–what you’ve done this past year. For instance, if your company is an animal shelter and you brought a few pets to a retirement home, don’t just say that. Include photos and a brief interview with one or more of the residents.

Show your supporters how you spent their money over the past year. Importantly, show how these events and successes connect to your mission and goals. For multi-year efforts, use infographics or charts to clearly illustrate progress.

 

Who Owns It?

Your annual report can feel like a whole heap of extra work on an already strained staff. How you assign the work depends on your purpose for the final product. In other words, is it a marketing piece? A donor communications piece? Or a financial report? You might ask your CMO or CFO to lead the project, depending on your point of view. A financial person is more likely to focus on the figures–which may be what your board wants. However, if you also plan to use the piece to reach potential donors, a marketing or development person can help put those numbers into context.

Remember, however, whoever leads it will require input from many sources. They might call upon–for example–your grant writer, your social media team, or your PIO for facts and figures. If everyone has buy-in, they are more likely to embrace the work and collaborate effectively.

 

Format, Delivery, and Timing of Your Annual Report

You may be eager to start on your annual report as soon as your fiscal year ends. That may work if you want to include unaudited financials. Remember, though, an audit takes time, so you might want to hold off for the audited version. You may have other quantities you already know–say, ticket sales, number of homes built, or pets adopted. Start with those while your auditor reviews your financials.

The format and delivery of your report may affect how long it takes. Creating a many-page glossy print piece requires design, photography, proofing and printing. A simpler print piece takes less time. A digital annual report might take even less. Then consider whether to email it, mail it, or distribute it some other way. All of these factors affect timing.

 

Show Gratitude

Many nonprofits choose to list their donors in their annual report. If you’re running low on space, make sure to show gratitude in other ways. Make it clear that you owe your accomplishments to the hard work on contributions of your supporters. Gratitude goes a long way!

 

PHOTO: Pixabay / CC0 Public Domain

By |2018-06-21T14:07:49-05:00June 21st, 2018|Small Business|0 Comments

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