Issue 41
October 13, 2005

NEWSNOTES is a monthly email newsletter published by Nonprofit Enterprise at Work. It includes items of interest to the nonprofit community in Washtenaw County and the surrounding areas, as well as resources available at NEW. NEWSNOTES is proud to celebrate its fourth year of publication, with delivery to over 550 subscribers every month! We welcome your feedback and suggestions!

NEW would like to recognize the generous support of its Community Partners:

Ann Arbor Area Community Foundation DTE Energy Foundation
Borders Group, Inc. The James A. & Faith Knight Foundation
Ford Motor Company Fund The Power Foundation
Pfizer Global Research and Development  

IN THIS ISSUE

LEAD STORY
FEATURED ITEMS
REGULAR FEATURES
NEWSNOTES Resource of the Month

Nonprofit Good Practice Guide
Dorothy A. Johnson Center for Philanthropy & Nonprofit Leadership, Grand Valley State University

 Provides key information designed to help anyone manage a nonprofit organization efficiently and effectively. The first of 10 topic areas is Accountability and Evaluation.

Learn more about the Guide through ResourceConnect, NEW’s free online database of resources for nonprofits. Share your favorite resources by clicking the “Suggest a Resource” link.

LEAD STORY

Accountability and Transparency for Nonprofits: What Do They Mean?

Reprinted with permission from Zimnotes*

"Accountability" and "transparency" are the key buzzwords for the nonprofit sector in this first decade of the 21st Century. This is ZimNotes' second look this year at these terms with the intent to better define what they mean.

For better or worse, the government will generally leave you alone if you provide poor service. And donors will usually forgive you for being inefficient. However, they will take you to task if you spend client money inappropriately, pay your officers too much, or forget to pay taxes correctly or on time. Media headlines about financial irregularities, overpaid executives, and outright fraud appear regularly. While in reality a very small percentage of nonprofits suffer from these problems, all pay the price of this type of attention. In the past five years an increased level of scrutiny by government has been applied to the nonprofit sector, creating new regulations and increasing the cost of compliance.

Accountability
Having financial problems has always been the most likely place that nonprofits get into trouble with the law. Today it is also a place that public and donors look to measure an organization's trustworthiness. Prudent financial accountability ensures fiscal controls are in place. The current trend for funders and donors (exacerbated by the media) is to examine carefully overhead expenses [the ratio of spending on programs (services) versus spending on administration (management) and fundraising]. There are wide discrepancies in how this information is reported; some agencies even reporting no fundraising costs (duh?...it's the rare nonprofit that can successfully operate with no fundraising costs). Percentage amounts customarily can range from 15% to 45%. Being accountable means ensuring these figures are reported accurately. When overhead percentages are low or high it doesn't necessarily mean that anything is wrong (a number of legitimate factors account for these variances) but it does mean that it should be reviewed closely.

All nonprofits provide some type of community benefit; that is why you get the advantage of being a nonprofit entity. Accountability includes ensuring that you are effectively providing this benefit service (be it feeding the homeless, protecting the environment, offering a cultural endeavor, etc). Organizations need to evaluate their services impartially and perform a needs assessment of their client/constituency population, making changes if needed. This often happens as part of a strategic planning process and is a critical part of being an accountable organization.

Transparency
Transparency involves how much you tell the public about your agency, and how honestly and quickly you reveal this information. One common way to make public your organization's financial records, principal programmatic activities and officer's compensation package is through the completion of the required IRS Federal Form 990, called the annual return. It is akin to a tax return, but not exactly the same thing. Most (non-religious) nonprofit organizations must file this return and major inconsistencies in how these forms are filled out are all too common.

The IRS Form 990 returns are also the major source of information that ratings groups use to compare organizations. While some have questioned the reliability of these ratings systems (with good reason), they exist to help donors evaluate the performance of the nonprofit. It is critical that your organization can vouch for its accuracy. This means hiring staff and recruiting board members who are more than "good with numbers;" each must have the requisite skills to get the job done right. Groups such as Guidestar make these IRS Form 990s easily available over the Internet. It is the savvy nonprofit that sees this as an opportunity to market your services and programs. Many sophisticated nonprofits that wish to be transparent also put their 990s on their own websites.

Another more comprehensive way to be transparent is to produce an annual or bi-annual report that goes beyond the financial focus of the 990s. You can lay out in a more compelling document your highlights of achievements, services and financial records with photos and graphics (and make these readily available to the public by posting it on your website). This, however, can be a costly administrative expense for a smaller nonprofit.

The more you can assure your own organization is accountable and transparent, the more trustworthy you will be viewed by the public, donors, constituents and regulators!

For a look at what the Federal government is considering to ensure all nonprofits are accountable see a previous article from Zimnotes “Nonprofit Accountability: At What Price?”

*Zimnotes vol. 8 #8 Sept. 22, 2005. Adapted from a soon-to-be-published revised board member training manual from Zimmerman Lehman.

Additional Resources:

FEATURED ITEMS

Customer Appreciation: Three Workshops for the Price of Two!

NEW appreciates your business, so throughout the Fall 2005 workshop term and retroactive to the beginning of the term, every individual who registers for two workshops (minimum $25 value) can register for a $55 workshop for free!

Register online or by phone, mail or fax for two workshops and redeem your free workshop at www.new.org/education/registration.html.

Contact Dallas Moore (734-998-0160 x228) if you have questions.

Foundation Center's Proposal Writing Seminar

Thursday, October 27, 9 a.m. to 4 p.m. Check in and coffee: 8:30 to 9 a.m.
The Michigan Union, 530 S. State St., Pendleton Room, Ann Arbor, $195

Take advantage of this rare opportunity to participate in the respected Proposal Writing Seminar presented by the Foundation Center, sponsored locally by NEW and the University of Michigan Libraries. Based on the best-selling book, The Foundation Center's Guide to Proposal Writing, this full-day course has helped more than 26,000 grantseekers build, strengthen, and polish their proposal writing skills. Coached by professionals who have built their careers on writing successful grant proposals, this course will benefit everyone on your fundraising team.

You will receive The Foundation Center’s Guide to Proposal Writing, 4th Edition (232 pages, a $34.95 value) and a workbook outlining all major course topics. The $195 fee is discounted by $25 for a second person from the same organization.

Register with the Foundation Center or call 800-424-9836.

Two Terry Axelrod FundraisingTrainings!

Terry Axelrod, founder and CEO of Raising More Money™, will teach two courses for NEW this fall.

“Building Sustainable Funding for Your Nonprofit (In a Post Disaster Fundraising Climate )”

Two Wednesdays: October 19 & 26, 12 noon to 1:30 p.m.
NEW Center, 1100 N. Main St., Ann Arbor. $55

This is a telecourse, taught remotely from Seattle, and offered at the NEW Center via conference phone.

This interactive, two-part session gives you a practical, step-by-step approach to building long-term sustainable funding from individual donors, even in the face of post disaster fundraising challenges. In the two 90-minute classes, complete with handouts and on-site exercises, participants practice key exercises necessary to the successful implementation of each step of this model, including asking people to Point of Entry and Ask Events. Terry will provide coaching on how to keep your mission relevant; how to convert “disaster donors” to long-term donors; and how to identify what aspects of disasters motivate such unprecedented giving and tap into that for your own mission.

“Re-igniting the Passion for Your Mission”

Monday, November 14, 9:00 a.m. - 11:00 a.m.
Washtenaw United Way Building, 2305 Platt Road, Ann Arbor. $40

Terry teaches this workshop in person and welcomes representatives from organization of all sizes to get re-energized about their mission. The description of the session from her website: “Passion for the work of your organization is at the heart of all successful fundraising today. This fast-moving, experiential, hands-on session introduces board members, volunteers, and staff to the Raising More Money Model for fundraising, reconnects you to your initial passion, and trains you to use that passion to speak powerfully about the work of your organization.”

Register for these sessions and see all of NEW’s workshop offerings online.

Leadership2Go: Ready, Set, Lead!

Friday, December 2, 8:30 a.m. - 10:30 a.m.
NEW Center, 1100 N. Main St., Ann Arbor

NEW’s Executive Director Series next quarterly session will be "Ready, Set, Lead: Nurturing Your Personal Leadership Style." Hear several prominent nonprofit executives share their secrets to success in leading their organizations and communities - and learn how you can incorporate a few of their ideas in your own work every day!

Leadership2Go is reserved for nonprofit executive directors. Advanced registration is requested online or by phone 734-998-0160. The cost to attend is $10 and includes a continental breakfast.

New Acquisitions in the Library

Be the first to check out some of these new titles recently added to the Borders Group Nonprofit Resource Library. Find the workbook you need to lead you through the strategic planning process, pick up some new ideas on fundraising and special events, or get tips on managing your personnel. You can even find a purple cow! Visit the library Monday – Friday,
9 a.m. – 5 p.m. Books may be borrowed for three weeks.

Is Yours the Best-Managed Nonprofit?

Apply for the “best-managed nonprofit” contest in southeast Michigan sponsored by Crain’s Detroit Business. Applications are due Wednesday, October 26.

The winning nonprofits will be profiled in the December 19 edition of Crain’s Detroit Business and will receive a contribution and recognition at the Crain’s Newsmaker of the Year luncheon in February, 2006.

Applicants must be 501(c)(3) organizations with headquarters in Wayne, Oakland, Macomb, Livingston or Washtenaw Counties. Previous first-place winners are not eligible; neither are hospitals, health-maintenance organizations, medical clinics, business and professional organizations, schools and universities, churches or foundations.

Ann Arbor Thrift Shop Requests Proposals

The Ann Arbor Thrift Shop is seeking proposals from qualified social service agencies designated 501(c)(3), located in the Ann Arbor School district. Disbursements from the Anne M. Hayes Fund, typically in the range of $2,000 to $5,000, will be made in December 2005.

Applications must be postmarked on or before Tuesday, November 15, 2005.

The application is the second page of the RFP on their website. You may also e-mail hayesgrants@annarborthriftshop.org to get an application, or pick one up at the Ann Arbor Thrift Shop, 3530 Washtenaw Avenue, Ann Arbor.

2006 Michigan Nonprofit Compensation and Benefit Survey

All Michigan nonprofit organizations with paid staff are encouraged to participate in this important survey of the nonprofit sector. Your information helps provide a clearer picture of how employees are compensated and aids in the ability to see employment trends over time. The deadline is extended to October 31, 2005. If your organization participates, you will receive free access to the final report scheduled for release in May 2006.

For more information about the survey, visit the Dorothy Johnson Center website or call
616-331-7585. To receive a survey number and password, send an email to Pat Nanzer.

Katrina Results in Change in Tax Laws for Charitable Giving

Congress has enacted The Katrina Emergency Tax Relief Act of 2005 to encourage additional charitable giving during this critical time. New income tax laws allow donors to deduct as much of their 2005 adjusted gross income as they desire (no longer restricted to 50%). Inform your donors that there are special new incentives for those who make charitable gifts of cash before the end of 2005. Businesses can also benefit from the new provisions. Download the document explaining the changes from The United Way forSoutheastern Michigan website.

Post Your Wish List

Nonprofit organizations registered on Volunteer Solutions with United Way for Southeastern Michigan may use the GiftMatch Program to post a wish list of agency needs. Just click on the "GiftMatch" tab on your on-line agency page to begin the process. You can post a needed item, or view items that donors have made available. If you have any questions regarding GiftMatch, contact Angela Walker (313-226-9450) or Patricia McCann (313-226-9416).

MasterMind Series 2005-2006

In response to the rising needs and expectations of arts and cultural leaders, Michigan Association of Community Arts Agencies (MACAA) and partners are presenting a second year of MasterMinds: Strengthening and Sharing Arts and Cultural Knowledge. These in-depth six hour workshops will be presented in three areas of the state (Detroit, Grand Rapids and Petoskey) on three consecutive days and will provide participants with the current best practices and trends used by some of the most brilliant minds in each field.

  • Arts & Cultural-Based Civic Engagement, November 8, 9 & 10, 2005
    With Barbara Schaffer Bacon, Animating Democracy, Americans for the Arts Program
  • Board/Staff Relationships & Transitions, February 7, 8 & 9, 2006
    With Susan Katz Froning, President and CEO of NEW, Ann Arbor
  • Developing Arts & Cultural Participation, March 21, 22 & 23, 2006
    With Sharon Rodning Bash, Metropolitan Regional Arts Council, St. Paul, MN
  • Building Your Individual Donor Base, May 8, 9 & 10, 2006
    With Kim Klein, Klein & Roth Consulting

For a limited time only, MACAA is offering a special rate for those interested in attending all four advanced training sessions. The MasterMinds Package deal signs you up for all four sessions at the location of your choice and saves you $120 off the regular registration price! OFFER ENDS October 21, 2005. Four sessions: members, $340; non-members, $420. Regular registration fees are members, $115; non-members, $135. Registrations are also being accepted for individual sessions. Visit the MACAA website to register and learn more.

Reminders

Office space is available at the NEW Center. Contact Lia Stevens (734-998-0160 x 203)

Women’s Expo is coming to EMU’s Convocation Center, Friday, October 21 and
Saturday, October 22.

Applications to the Ann Arbor Area Community Foundation’s Youth Council are due
November 2.

REGULAR FEATURES

Nonprofit Bulletin Board

Visit NEW's Nonprofit Bulletin Board to post and view notices about free resources, fundraising opportunities, and other items relevant to the southeast Michigan nonprofit community.

Events Calendar

Ann Arbor Area Convention and Visitors Bureau calendar of events. E-mail Nick Miller to request a password to submit an event.

 
 
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