{"id":590371,"date":"2021-09-03T11:16:34","date_gmt":"2021-09-03T15:16:34","guid":{"rendered":"https:\/\/joangarry.com\/?p=590371"},"modified":"2022-07-04T16:57:26","modified_gmt":"2022-07-04T20:57:26","slug":"nonprofit-budget-template","status":"publish","type":"post","link":"https:\/\/joangarry.com\/nonprofit-budget-template\/","title":{"rendered":"An Easy Nonprofit Budget Template (+ How to Use It)"},"content":{"rendered":"\n

It was my first day on the job at GLAAD. I sat down to meet with our then Director of Finance, and he nearly wept as I pulled my HP 12c calculator out of my backpack. <\/span><\/p>\n\n\n\n

Why so much emotion?<\/p>\n\n\n\n

At that moment, I didn\u2019t know if it was because he could see that I knew numbers and that maybe, just maybe, I could help save the place\u2026OR if he was thinking, \u201cHoly smokes \u2013 she knows numbers. She\u2019s going to get one look at these and get on the next plane back to NY.\u201d<\/p>\n\n\n\n

Turns out it was the former.<\/p>\n\n\n\n

Now I want to be clear: I did not have a background in Finance<\/em>… but I didn\u2019t have math anxiety either.<\/strong><\/p>\n\n\n\n

That\u2019s because thanks to a most excellent boss over at MTV Networks, a really nice and awfully smart man named Mayo Stuntz, I learned something very essential \u2014 numbers tell a story.<\/p>\n\n\n\n

Back then, numbers told us a story that led us to create the MTV Video Music Awards and then its Merchandising Program (pretty darned good stories they were too!).<\/p>\n\n\n\n

These days, I meet at least quarterly with my business manager. As she ticks and ties the numbers, I ask tons of questions that usually go something like, \u201cSo what\u2019s the story this year-to-date P&L tells me? What\u2019s going well? Where are the red flags?\u201d<\/p>\n\n\n\n

When you ask the right questions and learn how to get to the bottom of the story, budgeting actually becomes really simple. Like a finance person I once worked with told me a while back, \u201cIt\u2019s only a budget.\u201d I laughed then (odd words coming from the lead bean counter), but now I get what she meant by this:<\/p>\n\n\n\n

A budget is just a benchmark. A good, solid set of numbers that reflect what you know and what might be terrific estimates (as well as a few shots in the dark).<\/strong><\/p>\n\n\n\n

And as a nonprofit executive director, it is your job to make your best effort to create this set of benchmark numbers and then (here\u2019s the really important part) tell the story behind the numbers in a way that all board members, regardless of financial literacy, will really understand.<\/p>\n\n\n\n

To help you to do that, I have developed an easy-to-use nonprofit operating budget template. You\u2019ll find a bunch of them on the internet but they are just that \u2014 templates. What I\u2019m going to offer you is a basic template and also some advice on how to best use it to tell the story behind the numbers. Because as I said above, the numbers tell a story \u2014 but you need to learn how to tell it.<\/p>\n\n\n\n\n\n\n\n

BUDGETING FOR NONPROFITS \u2013 MADE SIMPLE<\/h2>\n\n\n\n

This piece of advice is a real game changer \u2014 but it\u2019s not actually about the numbers. Well, it is and it isn\u2019t. You see, the numbers are the HOW. How<\/strong><\/em> will I reach my goals? (OR how<\/strong> will we afford it?<\/em>)<\/span><\/p>\n\n\n\n

So if you really want a conversation about your budget to mean something, it should be preceded by or accompanied by a set of organizational goals. These goals, presented and endorsed by your board, should lead you to a budget (not the other way around). Trust me on this one \u2014 the next time you\u2019re presenting a budget to your board, keep referring back to goals of your organization and I bet you will get exponentially fewer weedy questions.<\/p>\n\n\n\n

AND you will be able to talk about the number (affirm \/ defend) in the context of goals the board has already endorsed. Instant buy-in.<\/p>\n\n\n\n

I suggest starting with no more than 10 goals. More will feel too tactical. More like to-do\u2019s rather than what you really<\/em> want \u2014 you know, the things you want to be able to bring up on New Year\u2019s Eve when you brag about the impact your organization has had<\/a> as a result of your collective efforts\u2026.<\/p>\n\n\n\n

WHY YOUR NONPROFIT BUDGET IS ONLY AS GOOD AS THE ASSUMPTIONS YOU MAKE<\/h2>\n\n\n\n

Remember: the numbers tell the story \u2014 but the budget does not. That P&L you hand out to your board to approve is riddled with all kinds of assumptions. These assumptions are in fact the building blocks of the budget.<\/p>\n\n\n\n

You might say that your board doesn\u2019t really ask about them. That they just want to know the overall increase in revenue and expenses. If that\u2019s true, it\u2019s probably time to get your Finance and Board Chairs to lead a discussion about the role of each and every board member as a financial steward<\/a>.<\/p>\n\n\n\n

I actually like to lead a budget presentation (after reminding them of the goals) with the key assumptions. Here are a few examples:<\/p>\n\n\n\n

Individual Giving<\/p>\n\n\n\n