Select a non-profit organization and submit in Digital Dropbox a Word document, which reviews main organizational attributes, trends, and financial values. The purpose of this introduction is to familiarize the reader with the entity you have chosen to study. The introduction could be organized into the following sections (this is not an exclusive list so please be creative):
1. Organization’s Background
• Historical Background
o Useful Sources: organization’s website, the net, and the CAFR (e.g. Notes to Financial Statements)
• Category of non-profit (humanities, arts, etc.); IRS tax exempt status; officials and board members; size of the organization
o Useful Sources: organization’s website, the CAFR (e.g. organizational chart, Statistical Section), Form 990
• Major programs and services
o Useful Sources: organization’s website, mission statement, strategic plan, and financial/budget documents
2. Demographic and Socio-economic Information
• Analyze Demographic Trends (e.g. Population, Education level, Crime Rate, Percent of Home Owners, Median Home Value, etc.)
• Analyze Socio-economic Trends (e.g. Income per capita, Median Household
Income, Poverty Rate, Unemployment Rate, Major Economic Activities, Major Employers, etc.)
o Useful Sources: US Census Bureau, Bureau of Labor Statistics, organization’s website, the net, CAFR (e.g. Statistical Section)
o http://www.grantspace.org/tools/Knowledge-Base/Funding-Research/Statistics/demographic-information
Demographic and socio-economic information could help you identify service needs and fiscal threats. Analysis of such information could simply involve the creation of a line graph and a description of the overall trend (e.g. percent changes, value changes). Further, you could compare demographic and socio-economic trends of your selected organization with regional/state/national ones. Could the observed trends impose new service needs or fiscal threats to the examined organization? Why yes? Why not?
3. Financial Information
A. Using the most recent financial statement of your selected organization (e.g. 2014
CAFR/Financial Audit or Form 990 if available) build a dataset in Excel with the following information:
• Top 5 financial Assets and Liabilities.
o Source: Consolidated Statement of Financial Position – CAFR/Financial Audit
• Total Assets and Total Liabilities
o Source: Consolidated Statement of Financial Position – CAFR/Financial Audit
• Net Assets Classifications (unrestricted, temporarily restricted, permanently restricted) of the different Funds (e.g. usually NPOs have one fund)
o Source: Consolidated Statement of Financial Position – CAFR/Financial Audit
• Total Net Assets
o Source: Consolidated Statement of Financial Position – CAFR/Financial Audit
• Top 5 Unrestricted Revenue and Expenditure Categories. Focus on the Unrestricted revenues and expenditures.
o Source: Statement of Activities – CAFR/Financial Audit
• Total Unrestricted Revenues and Total Expenditures. Focus on the Unrestricted revenues and expenditures.
o Source: Statement of Activities – CAFR/Financial Audit
B. Transfer your Excel Dataset in your Word document using Tables/Bar Graphs/Pie
Charts and describe the organization’s current financial highlights.
Submitting your Project and Format Information
• Submit your project in Digital Dropbox no later than 7:30 pm EST the day of the scheduled class. In addition to submitting your Word Document and Excel File in Digital Dropbox, please also submit the CAFR/Financial Audit you used (or indicate a link of the CAFR/Financial Audit). This will enable me to double-check your numbers and make sure that you have collected the correct information.
• All text needs to be Times New Roman, 12-point font, double-spaced. Make sure that all information presented in the Word Document is free of grammatical and syntactical errors, looks professional, and is readable.
You may find examples of introductions for governments and NPOs at Blackboard (look under the Project Examples Folder). I strongly suggest taking a look at these examples, as they will help you visualize the format of this project.
PT2:
Financial Data and Trend Analysis: The following tasks are designed to help you study major financial information over time of your selected organization (trend analysis). As stated in Project Part # 1, trend analysis requires at least five years of data. Therefore, you will need at least the 5 most recent CAFR/Financial Audits or 990 Forms of your organization.
a) Submit in Digital Dropbox a dataset created in Excel with the following information from the 5 most recent financial statements:
o 5 financial Assets and Liabilities of your selected organization. Use the Assets and Liabilities that you have identified in Project Part # 1 as your reference. Focus on the operating fund.
o Total Assets and Liabilities. Focus on the operating Fund.
o Net Assets Classifications of the operating fund (unrestricted, temporarily restricted, permanently restricted).
o Total Fund Balance of the operating fund.
o 5 Unrestricted Revenues and Expenditures. Use the Revenues and Expenditures that you have identified in Project Part # 1 as your reference. Focus on the operating fund.
o Total Unrestricted Revenues and Expenditures. Focus on the operating fund.
b) After building your dataset you need to inflate or deflate the values. For the
purpose of this assignment when converting current values into constant please use the most recent fiscal year as your base year (e.g. if 2009, 2010, 2011, 2012, 2013 are available use 2013 as your base year). Converting your current values into constant values will increase the reliability of your comparisons. For more information on inflating and deflating values look at the Learning Activities Blackboard Folder, your notes, and the relevant virtual class recording.
c) In your Excel Sheet create line graphs that cover at least five years of values for
each financial category (so you will create 1 line graph for Total Assets covering at least 5 years; 1 line graph for Total Liabilities covering at least 5 years; 1 line graph for Total General Fund Balance covering at least 5 years; 1 line graph for Total Revenues covering at least 5 years; 1 line graph for Total Expenditures covering at least 5 years).
d) Transfer the line graphs in a Word Document and describe the trends.
o Is the trend upward/downward/hybrid?
o What is the maximum point of the trend and when was it observed?
o What about the minimum point?
o How much the values change over time?
Look at percent changes from year to year and overall, value changes from year to year and overall, annual growth rate.
o What are the contributing factors of the observed trend(s) in Total Assets, Total Liabilities, Total General Fund Balance, Total Revenues, and Total Expenditures?
The dataset you have built provides the answer to this question. For example, to understand the underlying factors of the Total Assets Trend all you have to do is to look at the performance of the individual assets you have collected. In simple words, some or all of the individual assets causes the trend you see in Total Assets.
Then please try to figure out what causes the responsible asset(s) to behave in such a way. For example, if investments dropped during 2008, 2009, 2010 but increased in 2011 and 2012 we could blame the Great Recession as investment markets during this period were underperforming. In case investments decreased but cash increased it is obvious that the organization liquidated some of its investments to increase its cash. This is generally a common strategy during periods of economic uncertainty as having cash available provides budget flexibility and security.
e) Once you are done describing the trends, you need to provide a conclusion. To
help you out ask yourself the following:
o Is the trend alarming or not? (e.g. should we worry in case of a negative fund balance; or decreasing fund balance; or decreasing revenues; or increasing expenditures). Why?
o Are expenditures growing faster than revenues and vice versa? Is this a good thing or a bad thing (remember income elasticity of expenditures and revenue elasticity)? Why?
o What about assets and liabilities?
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