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Posts Tagged ‘building’

Reviewing Financial Reports

s_falkow

Recently, I was asked, “What are some basic steps we can do to improve our financial management?”

I was visiting a local congregation and the leaders were in the process of reviewing their financial history, operations, and current accounting controls. In the meeting I listed off about five items, but in reflection, I thought I would create an official list of financial basics for nonprofit management.

Financial Basics for Nonprofit Management:

  • Tracking of Data- by tracking data, you can determine benchmarks for growth or decline. Be sure to track participation, income, expenses, donations (and levels of giving), and long term goals (and to communicate these to leaders, donors, and members).
  • Accounting Controls-many small nonprofits rely upon 1 or 2 people to handle all of their bookkeeping. This leaves them vulnerable to fraud and usually limits financial communications. Be sure to have monthly review of finances, independent reviews of bookkeeping, limits on spending, and requirements for approval of spending.
  • 6 Months of Emergency Savings- every organization should have 6 months of cash savings available to cover expenses in an emergency.
  • Line of Credit- as organizations grow, they can improve their cash flow by taking out a line of credit or operating loan. LOC should be capped at around 3 months of expenses, and often operate similar to a credit card for an organization.
  • Multiple Income Streams-no organization should only have one line of income. By creating multiple revenue streams, nonprofits increase their stability.
  • Endowment & Net Assets– Gone are the days when a nonprofit organization should operate at a net zero. By creating endowments and net assets, nonprofits can cover the cost of their operations, allowing more of their donations to immediately  go into outreach.
  • Facility Management– Buildings cost a lot to maintain and operate. If you own a facility, be sure keep up with facility maintenance, use it as resource, and improve it as building code and mission needs change- otherwise it can become black-hole that sucks money away from your mission focus.
  • Board Development- Board members are ultimately responsible for organizations- be sure board members understand their roles and that they are giving proper oversight of staff and operations.
  • Insurance- Be sure that your organization has enough insurance to cover its liabilities for its staff, operations, facilities, and to protect the organization from lawsuits and emergencies.
  • Management & Gift Policies-smaller nonprofits often lack staff, organizational management (by laws), and gift policies which help organize and outline how nonprofit organizations operate and how donations should be accepted and used.
  • Financial Relationships– this may seem like an odd item for this list, but knowing your bank manager, accountant, insurance broker, and financial advisers personally can be critical in emergencies and/or when you need additional help.

There are many other items that could be added to this list (brand management, communications, mission focus, etc), but these are some highlights to help you review how your church or nonprofit organization manages its financial operations.

 

 

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Programmable Wifi Thermostats

The Nest

When most of us think about a HV/AC system, we usually picture an older furnace- rarely would we picture a sleek thermostat that connects to a wifI system. However, this seems to be the future of energy controls for commercial and residential buildings.

Since 2008, manufacturers have offered thermostats that can connect to a wifi system, thus allowing control and access to the system via the internet. This has been a great upgrade, but until now many of the programmable thermostats have been confusing to use. In fact, the US Dept of Energy realized that most people who purchased programmable thermostats, actually used more energy than before, because they were too complicated to use.

So in an effort to make programmable thermostats more user friendly, several companies have begun to create systems that can be controlled by a computer using a program like Microsoft Outlook set set room temperatures.  Other companies, have also begun to make intuitive thermostats that create a pattern of use based on how you adjust the temperature over a period of a few weeks.

With heating and cooling systems accounting for 16% of the electricity in the USA, and more than half of the energy consumed in a house, HV/AC systems will continue to be a focus for utility companies as they try to reduce the amount of energy consumed in the United States. This trend will likely also become a focus of more and more churches, facility managers, and home owners as the cost of energy continues to rise.

After all, the less money that people and organizations are forced to pay for utilities, operations, and energy, the more money they have to support the mission and programs that they value. For more information about changing HV/AC systems, please read the following articles:

Blog notes: Several of the stats given in this blog were pulled from these  two articles. The picture above comes from several sources and is provided by the company and can be found on their website- http://www.nest.com

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Last week I was contacted by Bart Voight of Voight Creations about setting up a referral process for churches who might need visual renderings or 3D modeling for their various building or capital fundraising campaigns.

In many cases, architects can provide a simple floor plan or elevation sketches to help donors envision what the final project will look like. However, in some cases a church may wish to consider having a more detailed or realistic model, which can now be created with 3D technology (see image).

church rendering

Voigt Creations

In my conversation with Bart, I asked him, “What are the top 5 reasons a church may wish to use this technology?” His responses are below.

What are the top 5 reasons a rendering would be helpful to a church?

  1. Clarification of concepts and ideas-  the vision of the project
  2. Zoning or code approval- assisting local zoning boards (more…)

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balance beam of resources

Balancing Resources

Every organization has two types of resources- Financial and Human Capital.

Now most of us could define that financial capital refers to money and other tangible assets (buildings, furniture, or automobiles), and that human capital refers to people. However, as simple as these two definitions are, most nonprofit organizations and churches suffer from not balancing both of these resources.

In most cases, this diagram would be tilted up or down, meaning that an organization would be overusing (or underusing) one of these two sources.

For example, and organization that lives in fear of having enough money to cover its expenses, most likely is overusing its financial capital to measure its ability to perform a task.  Forgetting that there may be multiple resources that it could draw upon from it human capital to provide that same service or task.

Similarly, an organization that focuses purely on analyzing it volunteer or stakeholder base, often will forget to really evaluate how to best leverage its financial resources to support its human capital.

In order to strike a balance, organizations need to take time to analyze the full potential of all of its resources by taking the following steps: (more…)

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Did you know a tree can add 10% of value to a property?  Or, that trees can help to lower heating and cooling costs to a facility?

trees

Ben.Millet

The answer to both of these questions is “yes, both are true.”

In 2005, Susan Wachter, from The Wharton School at the University of Pennsylvania, conducted a study entitled, The Determinants of Neighborhood Transformations in Philadelphia.” The study was designed to analyze the economic impact of how planting trees and creating site improvements impacts the value of property values.

Some of the highlights of the study include:

  • The study finds that vacant land improvements result in surrounding housing values increasing by as much as 30%. (more…)

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As cities continue to grow and add building and parking lots,  storm water runoff is becoming a big issue.  Many urban areas have combined sewer and storm water systems, and when it rains, they easily can be overwhelmed and cause raw sewage to enter local rivers and streams.

In Indianapolis, for example, it only takes 1/4 inch of rain to cause the sewer system to over flow, and thus, more and more cities are looking for ways to reduce the amount of storm water that enters the sewage system.  Cities like Chicago are creating ‘green roofs,’ rain gardens, and they are using porous pavement to allow water to seep back into the ground.

Curious to show the benefits of these techniques, I took a tour of the new Nature Conservancy office in Indiana.  The facility was built last year, and using the USGBC LEED rating system, the architect added a ‘green roof’ and a two phase rain garden (see pictures below). These systems helped the building achieve points in the areas of Sustainable Sites and Water Efficiency (SS5.1, SS6.1, SS7.2, WE1), which were used toward achieving their overall LEED certification.

The first picture shows the roof of the facility,  and how the conservancy used local and native plants to create a green space on their roof.  My tour guide said that this roof has helped to lower the cost to cool the facility in the summer, reduce storm water runoff, provided added protection to the roof’s membrane, and created a new habitat for birds and insects.

Plants on a roof (more…)

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To cap off the week, I thought I would share a few articles and topics that peaked my interest.  I am not sure if I will be able to get a full blog up about these individually, but I did think that they would be important resources as they relate to church giving and operations. Be sure to check out #3 and the zombie house at the bottom:

  1. Executive Directors Should Invest More Time on Their Boards– is an article by Rick Moyers that highlights how executive directors (think ministers) are often frustrated with their board of directors.  The interesting part of the article is that directors who spend less time with their boards have a higher level of frustration and feel like the board is less effective.  (Article produced by The Chronicle of Philanthropy)
  2. Fundraisers Mull the Effects of a Double Dip Recession– is an article by Holly Hall that discusses why charities should not be too scared by the economy, but also why it is important to do a little bit of research before you visit a donor.  For many people this recession, and the threat of a double dip, is really a financial stress, but for often donors still hope to support their favorite charities, religions, and causes.  (Article produced by The Chronicle of Philanthropy)
  3. How a Double Dip Recession Could Affect Giving- is a great article on what nonprofit organizations can expect in the current giving economy.  2008 and 2009 have been devastating to total philanthropic giving, and forecasters predict that giving will decrease in 2011 again.  This article will help churches and other nonprofits to look at how to best center their fundraising focus. (Article produced by The Chronicle of Philanthropy)

And finally, I wanted to share this ridiculous, and yet amazing, zombie proof house (more…)

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