Coaching Best Practices in Small Nonprofit Financial Accountability

Coaching Best Practices in Small Nonprofit Financial Accountability continues to shine a light on how your organization handles its financial responsibility. 

Examine each of the four remaining practices. Apply them to your own situation. How is the organization doing? What needs to be adjusted? How will you do that. 

Several very practical questions need to be asked, and actions need to be taken wherever warranted. The handling of money in a way that is above reproach is not just something to be desired. It's not optional. It's a must.

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69. An Independent Source is used to Audit Financial Records

This is Practice 69 of 80

Have a reputable accounting firm run an audit on your books annually. That way your stakeholders and the public will have trust in your organization’s operation and leadership.

People don’t always tell you their reasons for abandoning the organization. Instead they vote with their feet, they just don’t come back. Not feeling confident in how the organization handles money will do that for donors.

Belong to a recognized organization respected for financial public accountability. Meeting their reporting requirements means something. This type of membership allows you to stay on the cutting edge of legislation that affects your organization.

• How current is our membership in such an organization?

• How much information is released by our auditor?

• Is it sufficient? What else might be needful?

• How widely do we disperse this information and in what form?

• What do people need to know to give them an accurate picture and thus create credibility?

Why This Practice is Important to Me as a Leadership Coach

Trust and credibility are absolutely essential between you, those who support you and those you serve.

This can be so easily eroded. My clients receive another level of accountability. Their organizations receive an independent personal, gut-level check of their leader.

But, I am not the nonprofit police. I depend on the word of the client. When they put in place a third-party audit, it adds a professional, unbiased, data-driven picture of finances. I encourage that. 

The Key Concept, Attitude or Action That Drives This Practice

TRUST

Trust comes with being willing to have someone qualified check your books.

An Expansive Thought

Trust takes time to build up. It can be torn down in a moment. Build trust and keep trust.

An Action Point

Make an audit - by an objective, professional source - an annual check point. 

This is a critical "must-do" to pull out of this section - Coaching Best Practices in Small Nonprofit Financial Accountability.

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70. Financial Resources are Perceived as an Investment in People

This is Practice 70 of 80

If your money is seen as a tool for investment in people, it will affect your decision making in a new way.

Money then can become part of the master planning process in a fuller way, beyond simply paying for “things.” You will have a guiding attitude with which to think about funds.

• Is there any way in which we need to change our attitude as an organization toward investing in staff?

• How can I as an Executive Director or Board member emphasize investing in people with our resources?

List three ways to actually support this investment-in-people attitude, when discussing finances. 

Why This Practice is Important to Me as a Leadership Coach

We are often so busy purchasing and putting together 'things' that we fail to ask if we are investing in 'people'. I'm in the "people" business. I hear when they appear starved for help and knowledge. 

If we are to have the best in leadership from those we have appointed, we need to see they get the training, tools and encouragement they need.

The Key Concept, Attitude or Action That Drives This Practice

INVESTMENT

What will be remembered long after anything else is the direct investment we made in individuals, whether those we serve or our staff.

An Expansive Thought

Have you ever made a shift from 'things' to 'people?' What element of your organization would benefit from such thinking?

An Action Point

It there was one attitude you need to change in your organization, what would it be?

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71. Methods of Fundraising are Consistent with Organizational Values

This is Practice 71 of 80

You never cross the line of integrity when fundraising.

It is carried out in a way that respects your values, people, and their sensitivities toward your organization.

The senior leadership knows who is involved in fundraising and how they are operating. Executive limitations are in place to prevent embarrassment, hurt or loss of credibility.

• What would lead a potential lender or donor to want to invest generously in your organization?

• In what ways are those elements in place? Not in place? 

• Identify the distinctive reasons your organization should continue to exist.

Why This Practice is Important to Me as an Executive Coach

Fundraising that goes against personal or organizational integrity comes with a high cost. My job is to zero in on such things and spark the Executive Director or client to think how they might make adjustments. 

Some of my clients have been professionally trained fundraisers. They know their stuff. I seek to learn best practices from them and pass those along to others who find themselves in charge of asking for funds. 

The Key Concept, Attitude or Action That Drives This Practice

ASKING

Our Lord talked about “asking." What really drives your desire and method of asking?

An Expansive Thought

How much is enough?

An Action Point

Asking generally begins in front of someone. Who is the vital someone you should go to first?

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72. Financial Records are Open to Anyone Who Should Know

This is Practice 72 of 80

Anyone who has a right to know ought to be able to access financial records easily, promptly and to the degree that is appropriate for his or her request.

Nothing to hide means everything to gain by supportive stakeholders.

• How long does it take for interested parties to get information or acknowledgment back from us?

• How easy is it for them to access the information they would like to have?

• What is the one thing we least want to reveal to the public?

• Why is that? What may need to change? 

Why This Practice is Important to Me as an Executive Coach

Most stakeholders don't check financial records, but if they wanted to, they should be able to get information in the shortest, easiest manner possible.

An attitude of openness says, "We are current, we are open to scrutiny and we value your business or partnership."

The more open we can be as leaders, the "easier" the task. We don't have to skirt around a question but can easily provide answers.

My clients feel the pressure when they have to be "secretive" or guarded in allowing people to understand financial information. Of course there will be abusers who must be guarded against, but here I am talking about our loyal donors and stakeholders. 

An Expansive Thought

Nothing to hide means everything to gain by donors, lenders or clients and customers.

An Action Point

Maybe if they don't ask, you should regularly tell them.

This is the end of Coaching Best Practices in Small Nonprofit Financial Accountability.

To go back and review Executive Director Coaching for Financial Management of a Nonprofit, click here.

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How are You Applying Coaching Best Practices in Small Nonprofit Financial Accountability?

Coaching Best Practices in Small Nonprofit Financial Accountability ends 8 actionable items on how your organization handles its financial responsibilities. 

This is an area that is so important. Don't dismiss it by saying, "Everything is okay," without taking the time to do a serious review.