How to Read a Nonprofit Financial Statement

Course Description

Understanding what the numbers say about the health of your nonprofit is critical to being able to manage the organization successfully. This course will develop your ability to appropriately interpret the major financial accounting statements that are used by nonprofit organizations. You will gain an understanding of the types of financial statements that are used by nonprofit organizations, and how they differ from for-profit financial reporting. Also, the course demonstrates the power and limitations of accounting information in assessing financial performance and decision-making. You will also learn the uses of financial statement analysis, or ratio analysis for nonprofit organizations.

Learning Outcomes

After completing this course, the learner should be able to:

• Identify and describe the documents and financial statements included in a nonprofit organization's financial report
• Analyze the information found in nonprofit statements of financial positions
• Analyze the information found in the statement of activities
• Analyze the information found in the statement of cash flows
• Describe the nature of business enterprises and nonprofit organizations, as reflected by the statement of financial position
• Define financial (ratio) analysis and explain its objectives and limitations
• Identify the various categories of financial ratios used in nonprofit analyses
• Define and calculate the ratios within each category