by Nick Eoloff

1. All your eggs in one basket – Pay attention to your reliance on any particular source of revenue, in particular government contracts.
   
   
2. Cash flow analysis done annually – You can’t know everything at the beginning of the year. Management cash flow never stops.
   
   
3. Financials that are opaque – Nonprofit financial reports can be complex and difficult but that’s not an excuse for board members that don’t understand them or poor communication about your financial situation.
   
   
4. Inflexible – Things always change – go with it.
   
   
5. Little to no overhead – Some organizations still believe that infrastructure and overhead are not a good use of resources. This decision never turns out well.
   
   
6. Low operating reserves – Everyone wants to have operating reserves but the only way to build them to by planning and managing surplus budgets.
   
   
7. Never leverage – Using loans and credit lines to build the organization and grab opportunities is smart management.
   
   
8. No long term plan – Strategic plans are great, but how much better if they include a basic financial plan for three or five years.
   
   
9. Preparing financial projections, but never reading them – See above.
   
   
10. The auditor’s notes don’t mean much – Make sure you read all the pages of your audit report. I know they don’t look interesting, but you’ll be surprised at how informative they are.

Source: www.nonprofitassistancefund.org

For more information about these and other training opportunities, contact Cathy Hartle.