Financial Management in Nonprofit Organizations Essay

1896 Words8 Pages
Running head: Financial Management in Nonprofit Organizations Financial Management in Nonprofit Organizations Executive Summary Successful management of a not-for-profit organization requires providing high-quality service, but at the same time, careful administration - to reduce expenses and automate processes are ongoing requirements. Each type of not-for-profit organization has unique management needs. For example: • Social service and government agencies require meticulous reporting practices, essential for meeting regulatory compliance and securing future funding. • Professional and trade associations are tasked with managing business events as well as maintaining education and certification records.…show more content…
The major economic forces that have affected and will continue to affect nonprofits’ liquidity are economic growth, consumer confidence, equity, housing and credit housing market conditions, as well as present and future local, state, federal and global economic policy (Zietlow, 2010). At the center of any successful nonprofit organization there is an effective chief executive and board of directors. These leaders must work as a team with a vision and specific skills, to effectively produce resources in order to accomplish the organization's goals. The majority of the decision making authority and leadership is shared amongst board members; however, critical management skills and day-to-day operational decisions rest within the authority of the chief executive. However, members of the board must also be sufficiently skilled in management in order to assess the work of its director to assist in the implementation and evaluation of strategic decision making. In contrast to corporations serving stakeholders and customers; nonprofits are ultimately directed to serving the public or specific groups and audiences. Unlike corporations who distribute a product, nonprofits services are delivered in the form of intangible or tangible products. Boards of these organizations are not structured in the same preciseness as those of major corporations. Companies with large resources have the
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