More not-for-profit organizations are recognizing the benefit of financial performance measurement as a strategy for evaluating operations, programs, services and financial stability. One useful measurement tool is financial ratio analysis. It involves taking data from your financial statements, using it to calculate ratios appropriate for your not-for-profit, and then benchmarking those ratios against past performance, management objectives or other organizations. Financial ratio analysis can help you assess your organization's overall financial condition and flag financial patterns that might be harmful or those that are successful. It could be the winning strategy you need to stay ahead in the numbers game.

1. Are our
financial
resources
supporting
our mission?
Is there a
match between
where our
sources are
derived and
their use?
Are our present
resources
sustainable?
What sources
of funding
are available
to support our
mission?
VIABILITY
RATIO
PROGRAM
EFFICIENCY
CURRENT
RATIO
QUICK
RATIO
OPERATING
RESERVE
OPERATING
MARGIN
OPERATING
RELIANCE
CHANGE IN
NET ASSETS
FUNDRAISING
EFFICIENCY
Nine Ratios to Help Measure
Your Not-for-Profit’s
Financial Health
Financial ratio analysis can help you assess your organization’s overall
financial condition and flag financial patterns that might be harmful.
Before you begin you should determine what you want to learn.
Using financial ratio analysis
can help you get ahead in
the numbers game with
valuable insight into your
organization’s financial future.
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