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Non Profit Organization – reporting financial and non financial information at AGM
5-15-2019
Nonprofits have an ethical obligation to their members and the public to conduct their activities with accountability and transparency. Nonprofits should regularly and openly convey information to the public about their mission, activities, accomplishments and decision-making processes. Information from a nonprofit organization should be easily accessible to the public and should create external visibility, public understanding and trust in the organization.
Nonprofit Financial Statements
Financial statements are important in the nonprofit sector as well as for-profit orientated organizations. The primary purpose of financial statements for nonprofits is to provide relevant information to meet the common interests of donors, members, creditors and others who provide resources to not-for-profit organizations. Those external users of financial statements have common interests in assessing
· the services an organization provides and its ability to provide those services and
· how managers discharge their stewardship responsibilities and other aspects of their performance
Accountability
A nonprofit must comply with all legally required reporting procedures.
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A nonprofit has an obligation to responsibly use its resources toward its mission and to benefit the community. The organization’s board should approve its financial audits, while the executive director and principal financial manager should attest to the audits.
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A nonprofit has a responsibility to establish and regularly determine clear performance measurements and to share those results with the public.
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Each nonprofit has a responsibility to adhere to the established industry standards that apply to its particular activity area.
Transparency and Communications
In the nonprofit world, transparency is defined as the widespread availability of relevant, reliable information about the performance, financial position, and governance of an organization. In other words, it is the amount of information that an organization tells the public about itself and how honestly and quickly it reveals this information. Donors today want to understand the need and how your organization meets that need. Being able to quantify the impact of an individual donation helps secure donors, shows transparency, and supports your organization’s overall mission.
Increased transparency on behalf of nonprofits and better information available on the Internet would achieve more confidence in the sector. Transparency works as a trust-building tool; the more accountable and transparent your organization becomes, the more trustworthy you will be viewed by the public, donors, constituents, and regulators.
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