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Nonprofit financial literacy from the National Council of Nonprofits

April 16, 2014 | By Jennifer Chandler, Nonprofit Knowledge Matters, National Council of Nonprofits

How much is that doggy in the window?
by Jennifer Chandler
posted in Nonprofit Knowledge Matters of the National Council of Nonprofits

April is financial literacy month, so in the nonprofit community it’s the right time of year to ask this question: "We’ve got some board members who don’t want to serve on the finance committee and claim not to understand financial reports. How can we help them become more comfortable with our nonprofit’s finances?" Hmm. Without meaning to be flippant, I submit that helping board members with this is as simple as showing them a cute puppy and asking them how much it costs. They might not be familiar with cost allocations for programs, or restricted funds, but they can understand that the cost of the puppy is not just the initial cost, but also the direct costs of food, treats, vet bills, plus the real, yet indirect costs of washing towels (muddy paws!), and just in case – "Oops – the puppy just swallowed its leash!" (this actually happened to a neighbor of mine) – funds set aside for emergencies.