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Non-Profit Toolkit Blog Series: Part 4a - Sample Non-Profit Financial Statements:

Here's a breakdown of the three main financial statements typically included in a non-profit financial report:

1. Statement of Financial Position (Balance Sheet):

This statement provides a snapshot of your nonprofit's financial health at a specific point in time, typically the end of your fiscal year. It's like a financial photograph, categorized into three main sections:

  • Assets:  Everything your non-profit owns or controls with economic value, such as cash, investments, property, and equipment.

  • Liabilities: The money your non-profit owes to others, such as unpaid bills, loans, and accrued expenses.

  • Net Assets (Fund Balance): The difference between your assets and liabilities. This represents the cumulative financial resources your non-profit has generated over time.

2. Statement of Activities (Income Statement):

 This statement summarizes your nonprofit's financial performance over a specific period, usually a fiscal year. It shows where your revenue came from (contributions, grants, fundraising events) and how you spent that money (program expenses, administrative costs).

  • Revenue:  All the income your non-profit generated during the period.

  • Expenses: All the costs your non-profit incurred during the period to deliver its programs and maintain operations.

  • Net Assets Change: This reflects the difference between your revenue and expenses. A positive number indicates your net assets increased, while a negative number indicates a decrease.

3. Statement of Cash Flows:

This statement details the cash inflows and outflows of your non-profit during a specific period.  It categorizes these cash flows into three main activities:

  • Operating Activities:  This includes cash received from donations, grants, and program fees, contrasted with cash spent on program delivery and administrative expenses.

  • Investing Activities: This includes cash used to purchase or sell investments.

  • Financing Activities:  This includes cash received from loans or contributions restricted for capital expenditures, contrasted with cash used to repay loans.

Building Your Financial Statements:

While the specific format may vary depending on your accounting practices, most non-profit financial statements follow a standardized structure. Here's a general process for building them:

  1. Gather Your Financial Data: This includes records of your income sources, expenses, assets, and liabilities.

  2. Categorize Transactions:  Classify your financial data according to the appropriate categories within each financial statement.

  3. Calculate Totals: Sum up the amounts in each category to generate the final figures for your statements.

  4. Review and Ensure Accuracy:  Double-check your calculations and ensure the information presented is accurate and reflects a true picture of your nonprofit's financial health.

It's important to note that this is a simplified overview. Non-profit accounting can involve complexities, and consulting with a qualified accountant is highly recommended, especially for larger organizations.


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