1. Cash Flow
My organization has:
- A budget planning process
- A board-approved annual budget
- Regular tracking of budget vs. actual spending
- A cash management strategy
- A reserve fund
2. Effective Use of Technology & Accounting Software
My organization has:
An accounting program that:
- is used regularly and effectively (e.g. QuickBooks)
- is scalable and will grow as our project grows
- can be integrated with other software (e.g. donor management, fundraising, docusign)
- tracks and produces reports based on fund accounting
- can interface with online systems for payroll processing, benefits enrollment, or other services
3. Internal Controls
My organization has:
- Strict policies for all staff (e.g. receipts required for reimbursements, everybody must complete timesheets, review of corporate credit card statements, etc.)
- Crystal clarity about who is handling each financial task (e.g. reviewing bank statements, approving payment of invoices, etc.)
- Physical controls (e.g. checkbooks are locked up)
- Regular bank statement reconciliation (bonus points if this is done by someone other than the bookkeeper if you are a small office!)
- Rules that prohibit people who handle money, such as the bookkeeper, from being the person who signs the checks
4. Annual Audit or Financial Review
My organization:
- Has an annual audit or financial review
- Is prepared for the audit/review each year with files and data easily accessible
- Has an audit committee of the board that reviews the audit findings
- Implements changes to policies and practices when recommended by auditors
- Has a “clean” audit every year
5. Maximizing Use of Program Grant Funds
My organization:
- Understands the true costs of each of our programs and reflects these in program grant budgets
- Maximizes opportunities to include allowable costs in program budgets (e.g. portions of rent, insurance, benefits, executive oversight)
- Regularly opts for the maximum allowable percentage for indirect costs
- Can make the case to funders of the importance of general support
- Tracks restricted and unrestricted funds in our accounting system
6. Fundraising
My organization has:
- Diverse streams of funding (e.g. government contracts, private foundation grants, individual donors, event income, earned revenues, program fees, etc.)
- Dedicated time, resources, and staffing for fundraising activities
- Integrated fundraising into the organizational culture so that all staff are able to serve as ambassadors of our programs, identify potential sources of funds, and help with stewardship of grants, contracts, and donors
7. Lobbying and Advocacy
My organization:
- Understands which advocacy and lobbying activities are permissible and not permissible for 501(c)(3) organizations according to the IRS, State of California, County of Los Angeles, City of Los Angeles, or other areas where our programs operate
- Tracks lobbying expenditures effectively
- Reports lobbying activity on our 990 and/or in other required government reports
- Knows where to go for help or questions when we are unsure whether an activity is permissible and/or what tracking requirements we must follow