"Get Resourceful" session on Financial Management!

May’s #GetResourceful session focused specifically on budgeting for Advancement and building an endowment. Thirty-five attendees from Cape Town’s NPO community gathered at the Inyathelo Resource Centre in Woodstock, many of whom were financial managers of non-profits. Inyathelo's Executive Director Shelagh Gastrow and Programme Director Gaby Ritchie were our experts for this session.

In the discussion about budgeting for Advancement, Shelagh outlined the importance of keeping a detailed paper trail of all financials, budgeting carefully and as accurately as possible (and trying to avoid broad categories such as "contingencies"), and ensuring you have a diversity of donors so that you will still have funding if a few donors change focus. 

Gaby explained how to create a reserve fund by budgeting for a surplus each year and using this to slowly build up a reserve. Endowments are funds that ideally should not be touched, although you could use the interest from the endowments. Reserves and surplus funds however can be used in your budget. Gaby advised to think carefully about the purpose of the reserve funds, how the board will engage with the reserve, and what the rules would be for accessing these funds. 

Shelagh explained how having reserve funds gives your organisation flexibility to engage with projects or work for which you have not specifically raised funds. 

Gaby referenced the Dan Palotta TED Talk, "The way we think about charity is dead wrong", which is recommended viewing. 

A discussion ensued about the model of a non-profit starting a for-profit company to provide funds for their non-profit work. The tax implications, the problem of split focus and conflicting values and objectives were some of the intriguing dilemmas raised. Another discussion of the “blended” funding model followed, where non-profits charge for certain services such as training or consultancy work, or sell products (like books) in conjunction with securing donations from funders.

Shelagh launched her latest ASK Inyathelo offering, a pocket guidebook on Budgeting for Sustainability. This free download is available from Inyathelo's Online Shop, or if you’re in Cape Town, you can pick up a copy at the Inyathelo Resource Centre.

For those not able to be there in person, the event was filmed by Cape Town TV so watch this space for dates and times of when the programme will be aired. The session was also live-tweeted https://twitter.com/inyathelo, followed by a live Twitter Q&A for those not able to join us in Cape Town. We will post a transcript of the Twitter session shortly.