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Financial management for NGOs

Financial management for NGOs. Key concepts and jargon Advance thinking for Mango training. www.mango.org.uk. So what is financial management ?. Take a moment to write down 3 or 4 thoughts on what financial management involves before moving to the next slide. Click when ready.

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Financial management for NGOs

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  1. Financial managementfor NGOs Key concepts and jargonAdvance thinking for Mango training www.mango.org.uk

  2. So what isfinancial management?

  3. Take a moment to write down 3 or 4 thoughts on what financial management involves before moving to the nextslide ... Click when ready

  4. Financial management entails: • to achieve objectives our financial resources

  5. One way to think about financial management to an organisation is likemaintenance is to a car ... .. we need to put in good quality fuel and give it a regular service so that it will run efficiently.

  6. But if we neglect it, the car will break down and will not reach its intended destination.

  7. Financial control is at the heart of financial management ...

  8. Financial control means that ... • Money is used properly • Assets are kept safe • Staff are protected • Managers can sleep soundly!

  9. This a simple project management cycle ... See if you can write down the equivalent of each stage in financial terms. Click when ready

  10. The financial planning cycle Set the budgets Build in learning and take action Receive & spend project funds Monitor the budget

  11. Why is financial management important in our work? • What do you think? The next slides share ten good reasons • How many can you get? Click when ready

  12. To be accountable to the people who give us money To be accountable to the communities we work with To provide financial reports for regulatory bodies To minimise fraud, theft and abuse of resources To plan for the future and become more financially secure

  13. To enable staff to make better decisions on the use of funds To achieve the objectives of the organisation To enhance the credibility of the organisation To get best value for our money To strengthen fundraising efforts

  14. A key feature of financial management is managing risk • Two types of risk: • Internal– from within, which we can do something about • External – from outside so beyond our direct control

  15. Financial risks pose a threat to our financial resources. Write down one internal and one external risk facing your organisation... Click when ready

  16. Typical risks for NGOs: • Internal– theft, fraud, fire, accidental damage ... • External – exchange rate loss, donors withdrawing funds, inflation ...

  17. The key to good practice in financial management? Robust systems!

  18. Accounting records • Books of account – ie the summary records • Supporting documents – ie the paperwork

  19. There are fourbuildingblocksin a strong financial management system ...

  20. Financial planning • Budgets for operations • Financing strategies for long term planning

  21. Financial monitoring • Financial statements for external accountability • Budget monitoring reports for internal review

  22. Internal control • Policies & procedures • Checks & balances

  23. Financial control • When all the building blocks are set up and working effectively, we achieve financial control.

  24. Find out more about Mango and free resources for NGOshttp://www.mango.org.uk/Guide

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