Reporting and Operations
It is important to report the financial position of the organization to the board of directors periodically, preferably monthly. Every organization presents this information differently, but a statement of financial position and a statement of activity should be the minimum presented.
During the year, a statement of activities noting the actual revenue and expenses for the month and to-date should be compared to the budgets prepared for the comparable periods. Any variances from expectations should be noted and explained.
The monitoring of the financial position of the organization in relation to the budget will allow the board of directors to take action if, for example, revenues are not sufficient to meet the projected expenses for the year. Steps can be taken to find other revenue sources or to cut costs.