introduction to financial monitoring
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This document discusses the importance of financial monitoring for NGOs. It explains that there are four essential building blocks to a strong financial management system: accounting, financial planning, financial monitoring, and risk management. Financial monitoring involves producing regular financial reports to track progress against budgets and plans. These reports are important for both internal stakeholders like managers and trustees as well as external stakeholders like donors and communities to ensure accountability. The document outlines the financial monitoring process and different types of reports used, including budget monitoring reports and annual financial statements.
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introduction to financial monitoring
- 2. www.mango.org.uk Did you know that there are 4 essential building blocks in a strong financial management system?
- 4. www.mango.org.uk This is about keeping an accurate and complete record of all financial transactions – for accountability and transparency.
- 6. www.mango.org.uk We have to plan ahead to make sure we have the money we need to achieve our objectives, now and in the future.
- 8. www.mango.org.uk This is about keeping track of progress against our plans and sharing how we are doing with key stakeholders.
- 10. www.mango.org.uk We have a duty to protect our financial resources and staff from internal risks such as accidents, theft and fraud. We do this by implementing a series of commonsense controls and checks.
- 11. www.mango.org.uk This slideshow introduces the financial monitoring process
- 12. www.mango.org.uk The building blocks are closely interlinked. Their systems and procedures overlap and complement each other.
- 13. www.mango.org.uk The building blocks are closely interlinked. Their systems and procedures overlap and complement each other. To do financial monitoring, you need data from the accounting records and budgets produced during the financial planning process.
- 14. www.mango.org.uk Financial monitoring systems produce a range of financial reports to enable key stakeholders to scrutinisethe figures, review progress in programmes, and decide on follow-up actions as needed.
- 15. www.mango.org.uk Financial reports must be timely, accurate and relevant
- 16. www.mango.org.uk There are two main audiences for financial reports…
- 17. www.mango.org.uk Managers and trustees need financial information to track progress in programmes 1. Internal stakeholders
- 18. www.mango.org.uk Donors, government agencies and local communities need financial reports for accountability. 2. External stakeholders
- 19. www.mango.org.uk Budget monitoring reports to compare the budget with actual spending and income, to assess progress and decide what action is needed Internal stakeholders use…
- 22. www.mango.org.uk Review Receive & spend project funds Prepare budgets Compare the budget with actual activity
- 23. www.mango.org.uk Review Receive & spend project funds Prepare budgets Compare the budget with actual activity Take action as needed to get back on track
- 24. www.mango.org.uk The annual financial statements which provide a summary of the financial results External stakeholders use…
- 25. www.mango.org.uk The annual financial statements which provide a summary of the financial results Donor reports which give an update on the use of project funds External stakeholders use…
- 26. www.mango.org.uk Annual financial statements Income & Expenditure statement
- 27. www.mango.org.uk Annual financial statements Income & Expenditure statement Balance sheet
- 28. www.mango.org.uk Annual financial statements Income & Expenditure statement Balance sheet INCOME – EXPENDITURE = OUTCOME Surplus or deficit?
- 29. www.mango.org.uk Annual financial statements Income & Expenditure statement Balance sheet LIABILITIES Things we OWEASSETS Things we OWN INCOME – EXPENDITURE = OUTCOME Surplus or deficit?
- 30. www.mango.org.uk Annual financial statements Income & Expenditure statement Balance sheet ASSETS – LIABILITIES = EQUITY What are we WORTH? LIABILITIES Things we OWEASSETS Things we OWN INCOME – EXPENDITURE = OUTCOME Surplus or deficit?
- 31. www.mango.org.uk Financial reporting is essential for… Successful project management
- 32. www.mango.org.uk Financial reporting is essential for… Successful project management Building credibility and trust
- 33. www.mango.org.uk Want to lean more about budget monitoring? Then join us on one of our practical and fun courses soon. Budget monitoring essentials eWorkshop now available! http://www.mango.org.uk/training training@mango.org.uk
- 34. www.mango.org.uk Find out more about Mango and free resources for NGOs http://www.mango.org.uk/guide
Notes de l'éditeur
- We cannot have timely and reliable project financial reports without robust accounting records; and we must have good financial planning systems to enable the budget monitoring process.
- We cannot have timely and reliable project financial reports without robust accounting records; and we must have good financial planning systems to enable the budget monitoring process.