Download - MOUNTAIN HEART NEPAL
Budge&ng&Planning
Culture
Repor&ng&Monitoring
MOUNTAIN HEART NEPAL FinancialSustainabilityCheck-up
Opera&ons
BoardGovernance
LEVEL1 LEVEL2 LEVEL3
Challenged Stable Healthy
BUDGETING&PLANNING
• Income Statement created for each line of project
No Maybe Yes
• Review Income Statement for each project No MaybeYes-Probability%ofsuccessusedto
netdownrevenueforecast
• Organization complies with Social Welfare Council quarterly reporting
No Maybe Yes
• Program total expenses Review Maybe Yes Yes
• Income Statement created for Unrestricted and Restricted funds
NoMaybe
Yes
OPERATIONS• Financial System Manual Software and single data entry Software and double data entry
• Financial Staffing – Chief Financial Officer (CFO) None
Yes-butCFOismore
transac&onalthanstrategic
Yes-experiencednonprofitCFOwith
strategicskillset&managingHR,Opera&ons&IT
• Financial Staffing - Treasurer Using him as the Controller Controller, manages transactions and closing process well
Controller and has extensive accounting knowledge
• Financial Staffing - Auditor An accountant with degree Registered accountant (any class) Experienced chartered accountant (Class A)
• Banking Bankrela&onshiptransac&onalBankrela&onshiptransac&onal
&strategic
Oneprimarybank
• CreditAvailability Self-funded Grant-funded or Grant-funded and fundraising
• CashFlowForecas&ng OnlywhenneededCashflowactualvs.budget
monthly
Monthlyplusgoforward6month
forecast
• RevenueRecogni&onProbably cash basis and recognize all when received Quarterly
As received and then released per organisation guidelines
• CostAlloca&onsNot allocated unless grant programs
Some costs allocated to departments and programs
Indirect & General and Administra&ve allocated to departments and programs
• Executive Committee Review Asneeded Quarterly Monthly
• Board Review Asneeded Quarterly Monthly
• Month-EndClosingProcess Inconsistent Notupdatedregularly Detailedandevolving
MOUNTAIN HEART NEPAL Financial Sustainability Check-up
LEVEL1 LEVEL2 LEVEL3
Challenged Stable Healthy
REPORTING&
MONITORING
• BankAccountReconcilia&ons-When Quarterly Monthly Bi-monthly
• BankAccountReconcilia&ons-Who
Accountant who issues A/P checks
Not the accountant who issues A/P checks
Not the accountant who issues A/P checks; Treasurer reviews and signs off
• CashTimingofPaymentsPayrolltaxesmaynotbepaid
&mely
Payroll&mely;A/Psome
paidoutsideoftermsPayrollandA/Ppaid&mely
• FinancialReportPrepara&on 30-60daysabermonthend Within30daysabermonthend Within10-15daysabermonthend
• Crea&onofFinancialDashboards No MaybeYes-&edtoKPI(KeyPerformance
Indicators)instrategicplan
• BalanceSheetAccountReconcilia&ons Annual Quarterly Monthly
• Endowment-Admin Program Officer Accountant Treasurer
• Opera&ngReserves Typicallydonothaveavailable NotmonitoredMonitoredandmeasuredto
benchmarks
• Opera&ngReservesAmount Lessthan3months 6months Over12months
• AnnualAudit Revieworcompila&on Yes Yes
BOARD
GOVERNANCE
• BoardMee&ngFrequency Irregular Quarterly Monthly
• FinanceCommijeeRole Asneeded SemiAc&ve-quarterly Ac&ve-monthly
• BoardRole/ResponsibilityClarity
Inexperiencedboard;lackof
strongleader;commijeestructurenotusedwell
Competentboard;finance
commijeereviewsreports&asksgoodques&ons
Knowledgeable&strategicboard;
strongcommijeestructure
• FinancialReportssenttotheboard Annualorwhenasked Quarterly Monthly
• Actualvs.Budgetrepor&ng/explana&ons
ForTotalRevenueandTotal
Expensesonly;noBalanceSheet&CashFlowrepor&ng
QuarterlyMonthlywithinsightsincluded
(e.g.,whatdothenumbersmean)
• RiskManagement Notaddressedunlessissuearises Focusedonlyonreac&veissues
Managementiden&fiesrisks
annuallyandboarddiscussesandapprovesmi&ga&onstrategy
MOUNTAIN HEART NEPAL Financial Sustainability Check-up