Course Overview

Financial management is one of the most important aspects in any organization, be it private, government or non-governmental. Very often NGOs work devotedly towards implementing projects that cater for the needs of deprived people and in this process financial management often gets side-lined during program implementation. This practice makes NGOs vulnerable to financial losses. In the absence of proper backup plans and funds, NGOs are unable to cope with funding crisis. Thus, everyone working to achieve an NGO’s objectives has an important role to play in ensuring effective and proper use of financial resources. This comprehensive course provides participants with the most important concepts in financial management for NGOs and equips them with the requisite knowledge and skills on how to manage finances effectively and responsibly to achieve their organizations’ objectives.

Who Should Attend this Course?

• Managers and professionals in the NGOs and community-based organizations
• Non-financial NGO officers and managers who want to improve practice in financial planning, control and reporting
• NGO finance officers interested in developing their financial management skills and knowledge to improve finance systems
• Policy makers
• Professionals interested in understanding financial management for NGOs

Learning Objectives

The course helps participants:

• Know how to achieve best practice in financial management for NGOs
• Build and use effective budgets – including project and donor budgets
• Know which accounting records to keep in their NGO – and why
• Understand budgeting and accounting for central support or core costs
• Understand the Balance Sheet – how to make sense of annual financial statements
• Monitor and control budgets – preparing and using budget reports
• Know how to prepare reporting to donors in order to meet donors’ requirements
• Safeguard assets through internal control systems and procedures
• Manage the audit process
• Manage and control financial resources more efficiently and effectively

Course Content

Introduction to financial management

• What is financial management?
• Principles of financial management
• Building blocks of financial management

Overview of financial management of NGOs

• Foundations for effective NGO work
• The financial management process
• Why is financial management important for NGOs?
• Structure and governance of NGOs
• Who is responsible for financial management?
• Good practice systems: Principles and building blocks of financial management

Minimum standards for financial management in NGOs

Budgeting and financial planning

• The financial planning process
• Cost structures
• What is a budget and who needs budgets?
• How to plan a budget
• Practical approaches to building good budgets and best practice in budgeting
• Cash flow forecasting
• Different types of budgets
• The common budget challenges
• Budget structures
• Budgeting techniques
• The budgeting process
• Multiple donor–funded programs

Understanding accounts

• The accounting system
• Accounting methods
• Accounting records
• Which accounting records to keep
• Types of accounting records in NGOs
• Types of financial statements prepared from accounts an organization keeps
• Full bookkeeping systems
• The income and expenditure report
• The balance sheet
• Procurement – steps, people and paperwork

Financial monitoring and financial reports

• Overview of financial reports
• Financial information and reports – who needs what, when and why?
• Using financial statements
• Types of financial management reports
• Benefits of external reports
• Elements to include in reports
• Analyzing financial reports
• Interpreting financial statements
• The budget monitoring reports
• Forecast reports
• Presenting financial reports
• Reporting to stakeholders: management, donors, beneficiaries
• Staff administration
• Safeguarding assets

Managing audit

• Internal and external audit
• Donor or project audit

Fraud and corrupt practices

• Bribery and the NGO sector
• Tips on the warning signs of fraud and corruption
• The role of audit
• How to minimize theft and fraud
• How to deal with fraud and corruption

Training Methodology

The training approach is highly interactive. It uses a mixture of presentations by the facilitator and by participant(s), group or individual exercises, use of case studies and role plays. These proven learning techniques enhance understanding and retention of covered issues.