Budgeting is a tricky enterprise at best, and for some is a downright harrowing experience. Particularly when it comes to predicting income generated from grants and contributions, budgeting for nonprofits is a process of ever-changing assumptions and adjustments.
That’s why we think these 5 Budgeting Tips for Nonprofits will help you set reasonable goals, keep you focused and help you stay on track to a balanced budget.
- Year-Round Preparation – Budget considerations don’t wait for a specific times to happen, they pop up throughout the year. So take good notes and keep a running file on things like salary increases, new equipment purchases, or unexpected changes in contributions or expenses. Then just pull out the notes you’ve been collecting through the year and you’ll be one step ahead at budget time.
- Start Early – They say the devil is in the details. So start early and give yourself enough time to do the necessary detail work (meetings, fact check, and review) to create an accurate budget. But be careful not to start too early, allowing so much time that procrastination creeps in. It’s also a good idea to clearly define expectations and deadlines.
- Check Your Math – Spreadsheet errors can wreak havoc on a budget, so double check your formulas and maybe calculate a few rows and columns manually to make sure they add up properly.
- Get Help – Don’t be afraid to get others involved. Delegate responsibility, solicit input, review your assumptions with others in your organization, and get buy-in from folks that will be operating with the budget.
- Document, Document, Document – Last minute changes are inevitable. So be sure to document everything and keep detailed notes so you can explain any budget variations if questions arise later on. Your notes will also serve as a useful tool for making better assumptions and more accurate budgets down the line.
MIP Fund Accounting Budget Module
If you’re struggling with a cumbersome budgeting process, you might want to take a look at the MIP Budget Module. With built-in spreadsheets, drill down capabilities, detailed reports, and the ability to create unlimited budgets for multiple fiscal years, the MIP Budget Module makes budgeting a breeze. Contact us and learn how we’ve helped nonprofits like you tackle their specialized accounting and budgeting challenges.
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