To Profit or Not to Profit: The Commercial Transformation of the Nonprofit Sector
The State of the Not-for-Profit Sector in 2015
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Transcript of The State of the Not-for-Profit Sector in 2015
DRAFT
©.2015 Grant Thornton LLP | All rights reserved | U.S. member firm of Grant Thornton International Ltd
The State of the Not-for-Profit Sector in 2015
DRAFT
© 2015 Grant Thornton LLP | All rights reserved | U.S. member firm of Grant Thornton International Ltd
Our second annual report focuses on trending issues to inform your forward-thinking decisions.
Articles apply to the NFP industry as a whole, with features specific to key sectors.
Our report is the result of practical, hands-on experience gained by more than 400 Grant Thornton LLP professionalsserving over 900 not-for-profit clients.
For your organization to grow and thrive…
DRAFT
© 2015 Grant Thornton LLP | All rights reserved | U.S. member firm of Grant Thornton International Ltd
Our Not-for-Profit practice is dedicated to helping your organization achieve its mission.
Our not-for-profit experience is deep. We offer it to assist you with the challenges addressed in this report.
Committed to organizations that do good
© 2015 Grant Thornton LLP. All rights reserved. 4
12 ways to enhance financial performance through SBA
To balance financial results and mission-driven outcomes, nonprofit leaders are performing strategic business analyses (SBAs) to transform their operating models and bottom-line financial health.
© 2015 Grant Thornton LLP. All rights reserved. 5
In focus: Social servicesMeet managed care demands with operating solutions
Needs are rising, but funding is not necessarily following suit. With an understanding of the changes to come, not-for-profit social service agencies will have a clearer view of their options.
© 2015 Grant Thornton LLP. All rights reserved. 6
Compensating board members is on the table
Some NFP board members are compensated for:• Unique skill sets • Competition for talent• Extraordinary time and effort• Exposure to high-risk levels
© 2015 Grant Thornton LLP. All rights reserved. 7
In focus: Museums and cultural institutions Get real with funding requests
To keep current and relevant, museums and cultural institutions must be willing to take on the subject of realistic cost estimations in determining funding needs and requests.
© 2015 Grant Thornton LLP. All rights reserved. 8
Evaluating an M&A strategy to expand impact and enhance outcomes
Successful as well as struggling organizations explore M&A for:• Financial viability• Adding depth and breadth to
offerings • Enhancing reputation and brand • Repositioning for long-term
success
© 2015 Grant Thornton LLP. All rights reserved. 9
In focus: Trade and membership associations Best practices for corporate credit cards
The solution to credit card misuse is to implement a risk management strategy — determine who should receive a card, and then apply strong controls throughout the travel and entertainment process.
© 2015 Grant Thornton LLP | All rights reserved 10
Issues trendingin the not-for-profit sector
Learn more. Read our report:
The State of the Not-for-Profit Sector in 2015grantthornton.com/stateofnfp2015
© 2015 Grant Thornton LLP. All rights reserved. 11
Strategic ways to pursue unrelated business income
As your nonprofit pursues UBI, ready for an IRS audit by preparing a revenue analysis, following framework recommendations.
© 2015 Grant Thornton LLP. All rights reserved. 12
In focus: Religious organizationsAlign institutional value to constituent priorities
A key strategy to better understanding and connecting with constituents is linking the value of services provided to members’ interests, needs and values.
© 2015 Grant Thornton LLP. All rights reserved. 13
For effective governance, boards must set a stronger tone
Nonprofit boards are recognizing that proper composition, with expanded diversity, is critical to board and mission performance.They are increasingly setting their own high standards and taking action to meet them.
© 2015 Grant Thornton LLP. All rights reserved. 14
In focus: Jewish and Israeli organizationsUS nonprofits must control operations funding
A U.S. nonprofit raising funds for an Israeli service organization must control how overhead costs are covered. The nonprofit does this to remain transparent to donors, efficient in operations and compliant with requirements for tax-exempt status.
© 2015 Grant Thornton LLP. All rights reserved. 15
Enhancing the strategic value of the finance function
Finance professionals are increasingly being asked to offer insights and deliver greater strategic value to their nonprofit organization’s long-term planning and resource allocation decision-making.
© 2015 Grant Thornton LLP. All rights reserved. 16
In focus: Private foundationsAchieve alternative investment payoff
With considerable complexity in alternative investments and more sizable positions taken by private foundations and other nonprofits, it is critical to have the proper policies, procedures and controls in place for evaluation and reporting.
© 2015 Grant Thornton LLP. All rights reserved. 17
Cloud computing’s next step — Recognizing, managing risk
Cloud computing is transforming IT and business models in every industry, including the not-for-profit sector.Investments are increasing, while spending on traditional hardware infrastructure is decreasing.
© 2015 Grant Thornton LLP. All rights reserved. 18
Higher education The State of Higher Education in 2015
See our higher education-dedicated report for issues, challenges, solutions and alternative approaches.
Find the STATE OF HIGHER EDUCATION IN 2015 at grantthornton.com/highered2015
Grant Thornton’s Not-for-Profit practiceHelping you deliver on your mission
© 2015 Grant Thornton LLP | All rights reserved 19
We selected Grant Thornton in large part because of their professionals’ depth of experience in the not-for-profit space. They quickly learned our business, have been very responsive to our timelines and are very professional in their approach. As we face a future with many anticipated changes, I am glad we are teamed with a firm of Grant Thornton’s caliber and diverse capabilities.Ron Burgess, CFOWounded Warrior Project
© 2015 Grant Thornton LLP | All rights reserved 20
Issues trendingin the not-for-profit sector
Find out more. Read our report:
The State of the Not-for-Profit Sector in 2015grantthornton.com/stateofnfp2015
© 2015 Grant Thornton LLP | All rights reserved 21
Issues trendingin the not-for-profit sector
Connect with our knowledgeable professionals.
Mark OsterNational Managing Partner Not-for-Profit and Higher Education [email protected]+1 212 542 9770