How to succeed in the new financial year

Article first published in Our Community Matters – June 2016

With the end of the financial year fast approaching, now is a great time for boards to review the year that was and plan for the next. The founder of B Cubed Management Consultants, Bronwyn Baird, offers these tips for success in FY 2016–17.

Permission was given by author for this article to be published here.

Mission, Vision – and Budget

Your organisation’s mission should be at the forefront of your mind in everything you do, and that includes budgeting. When preparing your budget for the next 12 months, compare the year just passed and the year ahead with your mission and strategy in mind. Analyse your “budget” versus “actual” figures for the closing year. Look at what areas did well and what areas need improvement. Did you meet your budget in all areas? How well did you go with forecasting 12 months in advance? Some organisations like to set the 12-month budget in May/June and then review it every quarter to take into account changing external conditions (political, economic, etc.) and internal environments (staffing, resourcing, etc.). Your long-term mission and vision, though, should help you to stay on course despite any tweaks you need to make.

Seeing Cashflow Clearly 

What is your cash position? A rolling 12-month budget allows you to see a 12-month cashflow forecast at all times. This provides you with the information required to plan not only for the lean times, but also for times of plenty – how will you invest those excess funds? If your organisation’s main income stream consists of grants, then you are probably already adept at managing the cashflow roller coaster. Having a forecast makes this less stressful.

Need an Auditor? 

Many medium and large not-for-profits will already have engaged an auditor to review the current year’s figures. For a refresher on your audit obligations under the ACNC Act, click here.

Board Reporting: Please Explain

How useful is the current financial reporting package provided to your board? If you’re not happy, say something. All board members should provide feedback on what they find most useful each month and whether they require additional information. This is especially critical at this time of the financial year. If necessary, make the time to sit down with the CEO or CFO to go through the figures or request time with an independent accountant for some coaching. Depending on the board’s financial literacy, you and other board members might even benefit from a professional development course in this area.


About the Author

Bronwyn Baird is the founder of B Cubed, a certified B Corp offering management accounting and CFO services to not-for-profits and small to medium businesses. Bronwyn is also a director of the not-for-profit organisation Hepburn Wind and the chair of its Finance and Risk Committee. Bronwyn is a Calxa Partner with great knowledge of the software.