Executive Director Coaching for Financial Management of a Nonprofit

Executive Director Coaching for Financial Management of a Nonprofit, especially the small one, will help you take a serious look at how your organization handles money. 

This is an absolutely critical area of accountability. Nothing can sink an organization, and therefore what it aspires to do, like mismanagement of funds.

Even the perception that something might be amiss will turn donors away. Take the time to work through these four practices, and then the next four in Part Two. 

Again, if you need to adjust the wording to be more reflective of your organization, do so. Create an agreed on baseline of current performance, and strive to improve so that when you survey again in six months to a year, your "score" will have improved. 

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65. Current Financial Status is Available at Any Time

This is Practice 65 of 80

By knowing your financial status you will be able to answer questions and make good decisions. Keep current in anything to do with the finances of the organization.

Know where you stand, year to date, compared to budget. Good records make for a less stressful reporting period at the end of the fiscal year.

• Within the next few hours, how completely could you report an accurate picture of your financial position?

• How can decision-makers access this information when needed? 

Why This Practice is Important to Me in Coaching the Executive Director

Money never makes a good guessing game, especially for donors. Having an accurate snapshot of your financial status means you truly do know where you stand.

I coach my clients to be financially literate and able to speak to people about the finances of the organization. No, they don't have to know "everything." But, they do need to know enough to be reliable, seen as leading, and actually passionate about the mission and what makes it happen. 

The Key Concept, Attitude or Action That Drives This Practice

RECORDS

Current records reflect good stewardship of what has been entrusted to you.

An Expansive Thought

Good decisions flow from knowing.

An Action Point

If you can show the details of the money, it probably means you have other critical details taken care of as well.

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66. Procedures Include the Ethical Handling of Money

This is Practice 66 of 80

The ethical handling of money matters to every person who has anything to do with your organization. A very few people often have to handle larger sums of money.

You protect them by putting in place a series of checks and balances. It's easy to implement simple things like more than one signature on cheques, month-end review of books, and a verifiable system of petty cash distribution.

Those are baby steps. As your organization grows in size, appropriate measures are only that much more critical.

If it isn’t in place now, do it. It will take pressure off those who handle money.

• What measures do we now have in place to protect those who handle money?

• Do we need to do anything more? What? How?

• In what other ways, without becoming onerous, can we eliminate exposing our money handlers to risk? 

Why This Practice is Important to Me as a Leadership Coach of Executive Directors

A very few people often have access to and responsibility to handle large sums of cash and other monies. Good procedures protect everyone from false accusation and temptation.

I know. I've been there. And, I put in place additional checks and balances to avoid risk and engender confidence that the organization was been well managed. I look for that in my clients as well. 

The Key Concept, Attitude or Action That Drives This Practice

PROTECTION

Everyone needs protection. Good checks and reporting systems provide that.

An Expansive Thought

This isn't about a lack of trust. It is about a provision of confidence.

An Action Point

Take action now to protect those who handle money. The ethical handling of money is critical.

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67. Money is used in the Most Efficient Manner Possible

This is Practice 67 of 80

No matter how money comes to your organization, whether by sales, fees or donations, it needs to be handled carefully. At any given time you should be getting the maximum value from your funds.

Don’t buy home quality when what you need is commercial quality. Don't jerry-rig inferior commercial when you need specialized. Thinking cheap does not equate with efficiency. And don’t spend a lot, when with some investigation you can do better.

You are a steward of the money that comes your way. If you don’t know how to be a good purchaser, let someone else do it. If you don’t know how to handle money, delegate to someone who does.

• What have we purchased or contracted in the last 12 months that was either inferior or of poor value?

• How did that happen?

• What can we do to make sure this doesn’t happen again?

• How do we train our people to determine good value for money spent?

Why This Practice is Important to Me as an Executive Director Coach

You are accountable for how you handle and use the money that comes in. My clients often carry this weight of responsibility more closely than others. They understand the responsibility of stewardship and want to be found faithful. 

Having me in their corner helps them think about these things in fresh ways, so they remain current in their thinking and proactive in their practices. 

The Key Concept, Attitude or Action That Drives This Practice

EFFICIENCY

Efficient doesn't always mean cheapest. It means targeted correctly to meet the accurate need.

An Expansive Thought

Imagine what good could be carried out with the money gained back from inefficiency.

An Action Point

If it is worth spending money on, it is worth reviewing.

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68. Standard Accounting Procedures Are in Place

This is Practice 68 of 80

Practicing standard accounting principles is a must. It is no longer acceptable to do an amateur job of taking care of the finances.

If, for the first time, you implemented this one single practice from Executive Director Coaching for Financial Management of a Nonprofit, you would have achieved a great thing. Of course most times government regulation requires you to report using third party scrutiny. 

Have someone who knows what they are doing or contract it out.

The correct people doing your accounting will pay for themselves many times over and you will have less stress. As an example, over time you can save thousands of dollars by having a knowledgeable person calculate refunds, payments, rebates, etc.

The larger your organization, the more detailed your work will be, but the principle is the same. Do it right.

• How is this happening in your organization?

• How soon could it happen?

• How will it happen? 

Why This Practice is Important to Me as a Leadership Coach

Proper accounting saves money, increases credibility and makes you more effective and attractive. In coaching new Executive Directors, I help them catch these things more quickly, simply because I have the experience. 

The Key Concept, Attitude or Action That Drives This Practice

EXPERTISE

In this critical area, expertise is called for.

An Expansive Thought

A trained person will pay for themselves many times over and you will have less stress.

An Action Point

If you don't have qualified people doing your financial reporting, how soon could it happen?

This is the end of the first four practices in Executive Director Coaching for Financial Management of a Nonprofit. Go on to review the next four practices in Coaching for Best Practices in Small Nonprofit Financial Accountability.

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How Will Working Through Executive Director Coaching for Financial Management of a Nonprofit, Change what Your Organization Does?

The practices in Executive Director Coaching for Financial Management of a Nonprofit, along with Part Two, really need to be paid attention to.

Small nonprofits might not have all the access to qualified people in the same way that a larger organization does. But, that doesn't mean there is any less responsibility to handle money wisely, professionally, and with the greatest of integrity.