Financial Management Tips for NFPs

The newly established charity regulator, the Australian Charities and Not-for-profits Commission (ACNC), has issued advice on financial controls for Not for Profit organisations, including tips on what to do when donations don’t cover expenditure.

The guidance also advises boards of charities to make an annual financial plan.

“Having strong financial systems and controls is very important to help protect you and your charity, and ensure it runs effectively and can meet its debts,” the ACNC said on its website.

“One person should not be solely responsible for authorising, completing and reviewing your charity’s financial transactions.

“You should always have two cheque signatories and where possible, have two people involved in handling and recording any money received.

“Consider how much money is likely to come in this year and whether you need to plan for or save funds for any unexpected expenses (such as new IT equipment) or gaps in donations or funding.”

As well as financial advice, the ACNC has also published guidance on managing conflicts of interest, dealing with internal disputes and recruiting new board members.

“Our aim is to boost public trust and confidence in the charitable sector, and part of that is giving charities as much support as we can to help them run their affairs smoothly,” ACNC director of education Sue Woodward said.

The financial controls advice for Not for Profits can be accessed here.