Almost all community based Not for Profit entities are made up of passionate members and supporters who volunteer their time and skills for a common goal. Whether it is a sporting club, community kindergarten or service club, these organisations thrive because of these skills and passion. While most organisations excel at arranging events, training members and fund raising, the behind the scenes function of recording the finances and reporting to members is not always of the highest standard.

When approaching the end of the financial year and with financial statements to be presented at an annual general meeting, the following may be of help:

Record Keeping 

Income – every amount of money collected and banked should be receipted. This includes membership fees, fundraising, donations and grants. The main details recorded should be the date, amount, name of person or organisation and what type of income it is.

Expenses – while some organisations still use cheques, it is acceptable to make payments by other means including bank transfers. However all payments should still be approved and authorised appropriately under the rules of the organisation. Most importantly, an invoice or receipt should be obtained for every item of expenditure.

At a minimum the details recorded should be date, amount, supplier name and the nature of the goods or services. While the organisation’s officers may be authorised for expenditure up to a certain limit, any high value, one off or unusual expenditure should have been previously authorised and recorded in meeting minutes.

Bank Statements – put together the statements for the complete financial year. If the organisation does online banking, there will be facility to print off all the transactions for the year.

 Preparing your Financials 

Unless you have a member who is an accountant or a bookkeeper, try to find one who will give you a hand to set up how you should record your transactions. While the organisation could use a computerised accounting program like MYOB, Quickbooks or Xero, these can be expensive, are not easily transferred from the host computer and should not be attempted unless you have sufficient training. We recommend using Admin Bandit software which is efficient, user-friendly and affordable.

Whatever method for recording transactions you use, get advice on how to categorise the income and expenses. Categories like “sundries’, “general expenses” or “other” are not helpful, as members will inevitably ask for further details.

The other main task is to prepare a bank reconciliation. Get advice on this if no one is familiar with the process.