A diverse nonprofit board offers broader perspectives, better community representation, and increased creativity. It strengthens governance and improves problem-solving. Diversity also brings varied skills and experiences to the organization. Having a diverse nonprofit board is beneficial to the organization overall. However, the finance team often needs to educate the board members on their board responsibilities and nonprofit finances. To effectively communicate your nonprofit financials to everyone, present your financial information in an engaging and understandable format. Here are five strategies to make your nonprofit’s financial reporting more accessible:

1. Know Your Audience

    • Assess your board’s current financial knowledge
    • Understand that not all board members have a finance background
    • Recognize the diversity of experience on your board

 2. Educate Your Board

    • Provide a comprehensive board orientation
    • Offer ongoing financial training sessions
    • Create resource guides defining key financial terms
    • Review policies and procedures annually

 3. Tell a Story with Your Data

    • Determine what you can measure
    • Decide how to evaluate performance
    • Identify what information is important to the board
    • Draw attention to key points

 4. Keep It Simple

    • Focus on the big picture
    • Analyze things that can be controlled
    • Report on operating targets and progress
    • Avoid overly complex visuals or immaterial line items

 5. Choose the Right Presentation Method

    • Use condensed financial statements
    • Consider a one-page memo to highlight key points and address potential questions
    • Utilize static visualizations like graphs
    • Explore dynamic visualizations for interactive data presentation

To have effective financial reporting to the board, the finance team should educate the board and present financial information in a clear and engaging manner. Effective financial reporting bridges the knowledge gap by presenting information in an accessible way. At YPTC, we help foster a better understanding of your nonprofit’s financial picture.  YPTC is available to assist with experienced staff.  For more information about this topic, click here to watch the webinar or here to contact YPTC for assistance.