Make networking a strategic asset for your nonprofit. Learn how to prepare, share stories, follow up on LinkedIn, and build relationships that grow donors, boards, and impact.
Discover how to engage staff, board, and volunteers with a simple nonprofit framework that builds clarity and impact.
Discover how purpose, empathy, and innovation build strong nonprofit leadership rooted in integrity, trust, and teamwork.
Learn how nonprofit leaders can overcome scarcity, financial, structural, and psychological, by leading with clarity and resilience.
Budget-friendly nonprofit marketing: AI SEO, video podcast clips, Apple Wallet passes & thought leadership.
Restricted grants for nonprofits can fuel impact—or strain cash flow. Learn when they help, hurt, and how to release funds wisely.
Women lead 75% of nonprofits but hold only 22% of leadership roles. Explore barriers and how authentic leadership drives change.
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Leading a nonprofit organization isn’t just about passion–it’s about effective leadership. Nonprofit executive directors play an irreplaceable role in steering their organizations toward success.
This guide will explore key strategies and insights to help you excel as a nonprofit executive director. Whether you’re a seasoned pro or new to the position, this roadmap will help empower you to make a meaningful impact in your community.
You can’t effectively lead an organization–or a team–if you don’t have clear goals, missions, or plans for it. The first step to becoming a great executive director is to build strong leadership foundations that help define your organization.
This process should include:
Defining and clarifying the goals and mission of your organization sets you up as a successful leader. In turn, you’ll earn the respect of employees, community members, donors, and organizational stakeholders.
In many cases, the Board of Directors sets the vision, mission, and values of the organization. Additionally, the Board, in conjunction with leadership, develops a strategic plan. As a new leader, it’s important to understand where the Board is with this and how you help move their agenda forward.
The nonprofit industry has a lot of unique challenges, but it also offers truly powerful rewards. Great executive directors know they need to learn the ins and outs of the nonprofit sector. This includes both the industry as a whole as well as your organization’s local or community landscape.
A great way to learn your organization’s landscape is to identify stakeholders in your immediate network and across the industry. Then, you can work to build relationships with these leaders to help you advocate for your organization’s mission and causes.
Additionally, you should stay up-to-date on industry trends and best practices. Subscribing to nonprofit industry journals, podcasts, and news outlets helps you stay on top of the latest nonprofit sector news and insights.
Effective team building and management make it easier for you to help your organization reach its goals and advance its mission. Building a strong team starts with hiring individuals who align with the organization’s mission and values.
You’ll likely have to prioritize the most important roles to hire for immediate success. For example, do you need to hire a CFO or more frontline workers to help perform programs and services?
But building your team is only the first half of a great organization. You also need to work on creating and encouraging a positive workplace culture. Too often, nonprofit workers feel overworked and underappreciated. As an executive director, you have much power to help foster a healthy workplace from the top to prevent burnout and keep employees happy.
As an executive director, one of your most important roles in your organization is providing financial management. Even if you have an extensive fundraising team, you’ll likely still be working hands-on in managing funds, creating fundraising strategies, and allocating resources effectively.
Essentially, you can consider yourself the financial steward of your nonprofit. Your work will likely include:
Communication and transparency are essential for the success of your organization. Keeping communication channels open fosters trust and accountability within the organization and among stakeholders from the board or directors to community leaders.
Likewise, sharing stories about the organization’s impact helps engage donors, excite volunteers, and inspire the community. Active, excited community members lead to continued support for your nonprofit and its mission.
Additionally, leading with transparency helps you manage public relations to create a positive image of the organization. Handling any crises quickly and transparently helps you maintain trust and credibility with the community.
Succeeding as a nonprofit executive director requires strong leadership, strategic thinking, effective communications, and a deep commitment to your organization’s mission.
While the journey may be challenging at times, the impact you make on your organization and community is immeasurable. If you embrace the opportunity to lead with purpose and let your passion drive you forward, you’ll be sure to succeed as an executive director.
Need a little help with the financial aspects of running your nonprofit? The team at The Charity CFO is here to help! We provide comprehensive bookkeeping and accounting services for nonprofits.
Contact us today to learn more about our nonprofit accounting services.
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Transparency and accountability are two of the most important factors in nonprofit accounting. Donors, the board of directors, and the public all want to know what your organization does with the funds it brings in. Being transparent in your nonprofit accounting helps build trust in your organization.
But what financial reports are most important to build that trust through transparency with your board of directors? There are five main financial reports you may want to consider when presenting financial data to your board of directors, including:
Your statement of financial position is a financial report that provides an overview of the organization’s financials at a specific point in time. For-profit businesses also call the statement of financial position a balance sheet, and many nonprofits do the same.
Your balance sheet is a lot like a health chart for a medical patient–it shows the current overall financial health of your organization. Balance sheets show details on how much money and assets your organization has as well as what it owes to others. Your nonprofit balance sheet will typically have three main components:
Providing your board of directors with a statement of financial position can help them better understand the financial health, stability, and liquidity of your organization.
More commonly known as an income statement, the statement of activities report summarizes your organization’s revenues and expenses over a specific period. Generally, this report is provided monthly, quarterly, or annually. Organizations that have a high amount of revenue and expenses may want to provide multiple timeframes for their board of directors.
The statement of activities shows your board of directors how much revenue the organization has earned and the amount of expenses incurred over the specified time. The report also details whether your organization has generated a surplus or deficit during the period. Key components of the report include:
An income statement report makes it easier for your board of directors to track revenue and expenses over time, which can help make long-term financial decisions.
An organization’s statement of cash flow report tracks the inflow and outflow of cash over a set timeframe. The report is generally broken into three parts:
Proving your board with a statement of cash flow helps them better understand the ongoing cash flow management of the organization. You can the board can also use the report to look for opportunities to maximize cash flow and optimize cash flow management to make the organization more resilient to unexpected changes in the nonprofit’s finances.
A budget-to-actual report compares an organization’s actual financial performance with its budgeted figures. This report highlights the differences between budgeted and actual revenues and expenses.
Your board of directors can use this report to better assess the organization’s financial discipline and operational efficiency. Organizations with major variances between their budget and actual may need to adjust their cash flow and expense management practices. Reviewing a budget vs an actual report also helps your organization identify discrepancies such as errors in accounting.
A fundraising and development report focuses on the organization’s fundraising efforts and donor contributions. This report shows information on funds raised through various campaigns and events. It also generally includes data on donor acquisition and retention rates.
Your board of directors can use a fundraising and development report to evaluate the effectiveness of fundraising strategies. The report can also help show the organization’s financial sustainability through donor retention rates.
Fundraising and development reports are great tools for planning future fundraising ideas for the organization. You can use the report as a starting point to see what fundraising efforts your donors respond to best.
These five financial reports can provide your board of directors with an accurate picture of your organization’s financial health. Depending on your organization, some of your reports may be more or less in-depth, and some organizations may not need each report for every board meeting.
Working with an experienced nonprofit accounting firm, like the Charity CFO, is an easy way to ensure you’re providing the right reports for your board. The Charity CFO team specializes in nonprofit accounting and can help you navigate the complexities of financial reporting for your organization. We’ll help you create a nonprofit accounting system that uses technology to automate some aspects of reporting, saving time over manual processes.
Need help setting up a financial reporting process? Contact us today to find out how we can help!
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Efficient bookkeeping is essential to the success and sustainability of any nonprofit. As a nonprofit leader, it can be difficult to give your bookkeeping the time it needs to stay accurate.
Luckily, modern accounting software and other bookkeeping technologies can help you keep up with day-to-day bookkeeping, reporting, and accounting tasks more efficiently.
Let’s take a closer look at the importance of efficient bookkeeping for nonprofits, common challenges, and how you can use technology to improve the accuracy and efficiency of your accounting system.
Just like for-profit businesses, nonprofit organizations need to have an efficient and accurate accounting system. Messy, broken accounting systems can lead to inaccurate financial reporting which can then cascade into further issues like noncompliance with regulations or loss of donor trust.
On the other hand, efficient and accurate nonprofit bookkeeping can help your organization:
Efficient bookkeeping isn’t just about keeping records–it’s about building a solid foundation for your organization’s financial integrity and operational success.
Nonprofits face unique challenges to keep their organizations running, including nonprofit accounting challenges.
Although nonprofit accounting challenges may seem overwhelming, having the right bookkeeping and accounting processes in place can help your organization overcome challenges including:
Technology is one of the most effective ways to improve the accuracy and efficiency of your nonprofit bookkeeping system. The rise in modern nonprofit accounting software and tech tools is making it easier than ever for nonprofit leaders to manage their finances.
Adding technology tools to your bookkeeping processes can have a range of benefits for your organization, including:
Technology can help you simplify your nonprofit bookkeeping and help you maintain more accurate records. However, it’s important to consider your nonprofit accounting tech stack to help maximize the benefits of technology for your organization.
To get the most from your technology implementation, consider these factors in your nonprofit accounting system:
Diving into the world of nonprofit accounting software can feel like information overload. There are almost endless tools and configurations you could use to run your accounting system, so how do you choose?
Simple: work with a trusted nonprofit accounting partner to create your customized nonprofit bookkeeping system.
The Charity CFO is an accounting firm specializing in nonprofit accounting. That means we know the unique challenges and needs of nonprofits like yours. Our team can help you sort through technology options to find software and services that work best for your organization.
Learn more by scheduling a call with us today!
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In many nonprofits, burnout is the emotional, physical, and mental exhaustion of employees due to prolonged stress.
Let’s look closer at the challenges nonprofits will face in 2024 – and how to solve them!
Finding the right accounting partner for your nonprofit is essential to the financial success of your nonprofit organization.
Known as a tech stack, building a comprehensive system from multiple tools is essential to successful technology use.
One of the best ways to get a quick read on your organization’s financial health is to compare your nonprofit budget to actual performance.
An effective nonprofit accounting system helps your organization stay transparent, manage funds wisely, and build trust.
Explore the benefits of using QuickBooks Online for your nonprofit and explore how to get the most out of the program.
Many nonprofits use merging to strengthen their organizations. Nonprofit mergers can help an organization better fulfill its mission.
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Does your nonprofit have ownership of a for-profit entity? Whether your organization owns a for-profit company outright or has limited ownership, a for-profit subsidiary can have serious tax implications for your nonprofit.
Let’s work through some of the most pressing tax implications you might face as a nonprofit with ownership in a for-profit company.
Recognized nonprofits generally receive tax-exempt status from the federal government. Tax-exempt status makes it easier for your organization to retain nonprofit revenue and meet the goals of your mission.
However, your nonprofit may engage in revenue-generating activities that don’t relate to the purpose of your organization. The money that comes from these activities is known as unrelated business income because it’s earned from activities that are unrelated to your exempt mission.
The IRS can potentially charge your organization federal income taxes on your unrelated earnings. Known as unrelated business income tax (UBIT), you may face this tax liability if your nonprofit regularly carries on a trade or business that doesn’t substantially relate to your exempt mission or purpose.
Not all unrelated business income is subject to federal income tax. The IRS provides UBIT exceptions and exclusions to account for situations where a nonprofit uses for-profit activities to advance its exempt purpose.
Common nonprofit income that could be excluded from UBIT includes:
Additionally, income generated using a majority volunteer labor force may qualify for an exception. For example, hosting a fundraising auction operated by volunteers may not require UBIT payment.
The IRS uses taxes on excess business holdings to limit how much ownership a nonprofit can have in a for-profit company without paying federal taxes. Taxing excess business holdings helps reduce conflicts of interest and limits the power a tax-exempt entity has over a business.
Excess business holdings are shares or interests a nonprofit holds in a for-profit company that exceeds the IRS’s limits. Generally, any ownership share over 20% of voting stock in a company is considered an excess business holding. Nonprofits with excess holdings may face an excise tax on the value of shares over the limit.
Many nonprofits partner with for-profit entities to help advance their mission with the financial backing of their partner. For example, a mental health organization might create a joint venture with a for-profit healthcare system to establish mental health facilities in underserved areas.
Depending on the nature of the joint venture, nonprofits could jeopardize their tax-exempt status if they don’t follow certain limitations, including:
You may want to work with a nonprofit financial advisor or accountant to set up a joint venture with a for-profit entity. Your advisor can help you avoid pitfalls that could affect your tax-exempt status.
Donors to nonprofits often receive tax benefits for their charitable giving. In most cases, a donor may be able to deduct certain charitable donations from their taxes. Many donors use nonprofit donations to lower their taxable income for the year.
Giving money to a nonprofit with for-profit business ownership could limit the donor’s ability to deduct donations, however. If your nonprofit engages in for-profit activities, you’ll need to communicate with donors to let them know. Proper communication helps donors understand the tax implications of their gifts and improves your organization’s transparency.
Any nonprofit with for-profit ownership needs to maintain separate accounting for each area of business. This includes keeping separate financial statements, revenue records, and bank accounts.
Separating business activity is essential for maintaining accurate records of income, expenses, and activities associated with each business. Properly-recorded books can help reduce your chance of noncompliance in a nonprofit audit.
The tax implications we’ve already covered mostly relate to federal tax-exempt status.
However, state tax agencies may also have rules for nonprofits that operate for-profit businesses. You’ll need to check your state’s tax laws and regulations to see how they might affect your organization.
Few parts of nonprofit accounting are as complicated as a nonprofit owning a for-profit business. Your organization may be liable for certain taxes on excess business holdings or income from unrelated business activities. In some cases, operating a for-profit entity could put your nonprofit at risk of losing its tax-exempt status.
Nonprofit leaders like you don’t have to navigate tricky tax implications on your own. Working with a trusted nonprofit tax advisor, like The Charity CFO, gives you the resources to avoid unwanted tax implications.
Our team of dedicated nonprofit accountants and financial advisors is ready to put our specialized knowledge to work for your organization. Reach out to us today to get started!
Employee benefits packages play a big role in attracting and retaining top talent.
While the nature of a nonprofit means you’re focusing more on your mission than making money, bringing in revenue is still essential.
Welcome everyone to A Modern Nonprofit Podcast. Today, we explored the importance of websites, nonprofit marketing, and how to bridge the gaps between departments to achieve digital success.
When we think marketing, we think of getting the word out and expressing the mission behind the help non-profit organizations (NPOs) provide. In 2023, this goes much deeper than we could imagine. There are many tools and resources that can be utilized to enhance NPOs, especially online.
We invited David Pisarek of Wow Digital, Inc. to give us a behind the scenes look at SEOs, attracting and retaining visits to websites, digital marketing and much more!
David started Wow Digital Inc. with the goal of providing effective websites, branding and design for Canadian based charity organizations. With over 20 years in the nonprofit sector, passionately working to revolutionize it one website at a time. An expert in design and programming, he’s also an educator at the college level. With a track record of 240+ complete projects since 2016, David and his team are the go-to experts.
We welcome David to the show!
We engaged in an in-depth conversation with David, where we unraveled a series of questions regarding nonprofit website redesign and the importance of web analytics.
Of course, there is much to learn about in each of the posed questions. David stresses that websites are not something that are sat and forgotten about. Or ‘one and done’ as he calls them.
They need constant love and care. A part of that care comes from measuring analytics. A free tool that can help organizations achieve this is Google Analytics. It’s important to note that Google Analytics 3 is the system that has been used for years. And as of July 20th, 2023, this was updated to GA4. So, if analytics are the next move for business, make sure GA4 is the system used.
GA isn’t just for tech-nerds; it’s a great tool that can help businesses identify what consumers, donors, or website searchers are looking for and take them back to the website over and over again. Keep an eye on:
All of these are key questions that businesses should be asking when it comes to analyzing their web traffic.
David makes a great point regarding website analytics. The word ‘conversion’ is a data point that can be measured. So for example, on a for-profit’s page this may mean that a conversion leads to an eventual sale. This has a different definition for NPOs. A conversion data point may indicate converted volunteers, donations, or simply subscribing to an email or newsletter.
Not only is it important to understand what data points to pay attention to, but also how they differ from business to business.
Before Tosha and David take a deeper dive into the topic of SEOs, David compliments Tosha’s question about a website revamp.
He and his team did an audit that lead to 5 indicators for revamping a website:
Number 5 may seem like a small task in the big scheme of things, but this is actually a great segway into the SEO conversation. Even if your organization is completely remote, putting a PO Box on your website can do wonders. Why? When people search for things near them (like volunteer opportunities), Google uses their location to find the best match.
In most cases, each device holds an IP address that gives Google some idea of your location. Because of this, when searching for ‘volunteering opportunities’ while the IP is in, let’s say the St. Louis, MO region, then Google can direct individuals to a website associated with that area.
Piecing the conversation together, NPOs are a different breed than for profit businesses. They still require constant measurement and effort, but the data points that are studied are much different. How this plays into the website traffic and SEO conversation, is what makes all the impact.
For example, revenue may increase in the winter months because of a historically associated ‘giving season’. Therefore, measuring data on a quarterly basis may be more effective when it comes to the NPO’s website as opposed to week over week or month over month analytics.
NPOs also work on a conservative budget basis, meaning that they can stretch a dollar.
With this, they may not be able to pay an individual, group, or department to only analyze data points for their website development. Looking at the numbers on a quarterly basis can help whomever lands this task a better window for analysis and time management.
Want to connect with David and his team? Email him at [email protected] or check out their website, wowdigital.com. His team also works with NPOs and website development by providing templates and website management through a website called, Mighty NPO. By using the coupon code charitycfo, this may qualify your business for a lifetime discount up to 70%.
To hear the full story, listen to our podcast here.
You can also find Tosha and The Charity CFO team on Youtube or our website, thecharitycfo.com!
Your community is where your donor base resides, so it’s time you start understanding it more. Listen to our podcast to find out how!
According to the United States Bureau of Labor Statistics, 12.3 million people are employed by nonprofits. That’s a lot of employees to manage!
Payroll is a critically important part of running any business and nonprofits are no different. This guide will explore everything you need to know about how to manage payroll for your nonprofit with accuracy.
Firstly, your organization needs a payroll manager and software to manage all the employee data. What is a payroll manager? This is someone specifically trained to manage the ins and outs of all your payroll needs including taxes and employee benefits.
Your organization likely needs to invest in a quality portal for payroll services. If your organization is really small and brand new, you might be able to get away with just a spreadsheet, but it’s not the best practice for accuracy and data transparency.
Payroll management isn’t easy and if you’re asking yourself how to manage my payroll, you’re definitely in need of professional assistance. Besides knowing the intricate details of payroll tax management and other tricky laws, these services can cut checks, facilitate direct deposits, and even track paid time off.
The best payment systems are two-sided so that employees can also log in and download their own data when they need it. Most of them even have smartphone apps!
This is a great resource for finding the payroll system that fits your organization. Paying a monthly cost for these services is well worth it in the long run for you and your employees to have a good work experience.
As you get ready to start paying your employees, you should ask yourself a few key questions. This will help make tax season easier and ensure there aren’t any issues with your employees!
Keeping track of all the information for each employee’s benefits can seem like a ton of work, but it’s crucial that the correct amount of money is removed from your employees’ pay checks each month.
Employee benefits might include, but aren’t limited to:
All of these benefits are up to the employer to offer, but every organization should verify their exact requirements to provide health insurance to their employees under the Affordable Care Act. This also may stipulate what portion, if any, of employee health insurance your nonprofit is required to cover.
Do you hire contractors or part-time staff? These workers may not have employee benefits and their payroll will need some tweaking. Contractor taxes also differ from that of full-time employees, so be sure to have all of this information prior to starting.
In addition to collecting W-4 forms from employees, be sure to provide all necessary paperwork for enrolling in health insurance and other employee benefits. Keep meticulous records on each employee both digitally and in hard copies.
Tax season might be everyone’s least favorite time of year, but it’s crucial for your nonprofit organization to withhold the correct amounts for each employee for both state and federal taxes, as your state allows.
After you collect each employee’s W-4 tax form, input the data into your payroll software and be sure to verify this information with your employee.
Here is a list of some taxes your organization might need to withhold from paychecks and potentially match per dollar:
In addition to your requirements to provide healthcare, your full-time employees have rights that you must adhere to according to the law.
For example, depending on your state, you may be required to offer a certain amount of sick days or vacation days.
You also may be required to provide paid or unpaid leave for new parents. Check with your nonprofit legal counsel to learn your particular state’s legal requirements before setting up your payroll system and employee handbook.
Part-time employees, full-time employees, and contract workers all rely on your ability to pay them on time and in full. While nonprofits might be exempt from certain taxes, they still function as a business and owe their employees a progressive payment system that accommodates all their needs.
If you don’t want to hire a payroll service, here are a few more options.
Accounting Department: If your organization is growing rapidly, consider forming a department to handle all of the financial information in-house with the help of software.
Hire a Bookkeeper: Bookkeepers have an extensive knowledge of payroll and financial systems. They can either be someone you hire to be in-house, but if your organization is small it is worth investing in a company and being one of their clients. Then, your bookkeeper is only used when needed. This is a great way to cut costs while taking the burden of payroll off your own plate while ensuring accuracy for employees.
Online Payroll/Software: If you’re brave, scrappy, and financially inclined, try managing all of this on your own.
Now that you have all the insider tips on how to manage payroll for your nonprofit, contact us for more information on how we can help your nonprofit have efficient and transparency pay processes.
After all, you should focus on your mission and we’ll handle the rest!
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