Business Best Practices for NGOs - Part 2: Business reporting dimensions - critical for NGOs sustainability
NGOs must track expenditures, present the information to different stakeholders in very different formats, prepare narratives that maintain the funders trust and keep the funds flowing. Their end-to-end programme execution comes with very unique requirements in terms of accountability and cash-flow tracking, impact measurement and revision. Working with government agencies, foundations, charities requires willingness and capability to respond to the different set of rules, reporting and compliance burdens imposed be each.
Three management dimensions – common across private and not-for-profit sectors - define the capability of an NGO to meet funders’ expectations:
Real-time transparency: the ability to provide real-time visibility into the flow of funds from award through to service provided and across all field locations regardless of language or currency and to demonstrate use of funds in accordance with stated purpose and adherence with award terms.
Data dexterity: the ability to combine flexibility and granularity in budgeting, data capture and reporting to manage and report against any imposed funding restrictions, to deliver detailed reports as required by different stakeholders, in a secure way, with a flexible account structure, independent of the regular accounting reports.
Timescale flexibility: the ability to report across different time periods, since grants usually cross fiscal years and reporting is expected at multiple timescales : the individual grant time period, the fiscal period of the recipient’s organization, and the fiscal period of the grantor organization. In most cases, the time period has nothing to do with the organization’s accounting periods or period end.