Nonprofit Reporting

Developing strong financial reports for Nonprofits is always beneficial. When operating a nonprofit there are certain areas of reporting that are important when an auditor investigate. An auditor analyzes and question any type of uncommon error or misstatement there is in financial reporting. When developing a nonprofit, it is important to know what an auditor is looking for and always be prepared for any types of disputes or questioning. Below is a list of financial statements any nonprofit should have prepared including 501c3 throughout the year. ​Be Prepared Statement of financial position Statement of activities Statement of cash flows Statement of functional expenses Statement of changes in net assets Notes to the statement What are Financial Statements? The financial statements are a list of records and items recorded to compare with the previous year to know the financial improvement or financial losses of the organization. So not only is it beneficial for tax season, it is also beneficial to pinpoint exactly what area needs improvement on. It is important that the recording of the financials are free of material misstatements. Therefore, I would prefer a bookkeeper, professional accountant or an independent auditor to create or look over the financial statements for accuracy, explanation and planning of other processes your nonprofit may need to take. References Bowman, W. (2011). Finance Fundamentals For Nonprofits, with Website. retrieved from http://site.ebrary.com/lib/ncent/detail.action?docID=10484824&p00=nonprofit+bookkeeping+accounting