Presentation made on March 9, 2011 to the Center for Non-Profit Success in Chicago.

1. Financial management 101: Best practices for managing your organization`s finances Ken Widelka, CPA CFO AADE Ken Widelka (c)

2. Today’s Focus Ken Widelka (c) Working with Auditors Risk Management (not just insurance) Navigating through Turbulent times

3. Types of Auditors Ken Widelka (c) Certified Public Accountants Internal Auditors Compliance/Regulatory Auditors

4. Risk Management Ken Widelka (c) Minimize your business risks: Policies and Procedures Do you have an investment policy? Do you have a social media policy? Do you have an audit committee? Health and Benefits (use a broker!) Business Insurance (use a broker or risk management firm)

5. NFP Survey Ken Widelka (c) Nearly 80% expect 2011 to be as or more difficult than 2010 80% anticipate an increase in demand for services 18% expect to end 2010 above breakeven 61% have less than 3 months cash; 12% have no cash

6. Navigating Nonprofits Through Turbulent TimesTwenty one ways to better manage your business costs Ken Widelka (c) 1. Centralize purchasing. You may be buying the same goods from different suppliers, particularly if each department seems to have its favorite suppliers. Centralize purchasing to maximize discounts through bulk purchasing power. 2. Cut the paperwork. Request monthly consolidated invoices to reduce administration costs. 3. Demand a reason. Don’t accept a price increase without challenge.

7. Ken Widelka (c) 4. Get a second opinion. Obtain alternative quotes on everything. Advise existing suppliers that you are going out to bid and give them a chance to reduce their prices. 5. Call in a bad guy. Don’t allow the person in daily contact with a supplier to negotiate price. Use the good cop/bad cop approach. The “bad cop” removes emotion from the process and the “good cop” can preserve the established, day-to-day relationship with the vendor. Navigating Nonprofits Through Turbulent TimesTwenty one ways to better manage your business costs

8. Navigating Nonprofits Through Turbulent TimesTwenty one ways to better manage your business costs Ken Widelka (c) 6. Ask for ideas. Take advantage of your suppliers’ expertise. Ask them for suggestions on how to improve the way you work together. 7. Make space. Reduce your stock levels and encourage suppliers to hold stock. 8. Review product specifications. Ensure that products being used do not exceed requirements. Recycled toner cartridges?

9. Navigating Nonprofits Through Turbulent TimesTwenty one ways to better manage your business costs Ken Widelka (c) 9. Clean up. You may be able to reduce the frequency of cleaning while still maintaining safety standards. 10. Don’t go to waste. Your garbage dumpsters may be emptied well before they are full. Can you cut back on the number of weekly or monthly collections or adjust the size? 11. Consider Couriers and Overnight services. Understand how your couriers charge. Local services may be best for early-morning deliveries, while worldwide carriers such as FedEx and UPS may offer lower prices for local delivery of letters and packages scheduled for later in the day.

10. Navigating Nonprofits Through Turbulent TimesTwenty one ways to better manage your business costs Ken Widelka (c) 11. Watch out for automatic renewals. Contracts for leased equipment such as copying machines automatically renew. This automatic roll over is called an “evergreen clause” and it locks you into subsequent years at the same terms as the original lease. 12. Beware. Service agreements, too, have evergreen clauses and need to be terminated, in writing, during a specific time window. Just to make things confusing, termination notification periods for service agreements vary from the periods used in the lease agreements. The window is typically 30-90 days before the expiration date.

11. Navigating Nonprofits Through Turbulent TimesTwenty one ways to better manage your business costs Ken Widelka (c) 14. Make less space. If you pay for staff parking, do not allocate a specific space to a specific staff member. Have 7% percent fewer spaces than the number of staff entitled to them. On any day, you’ll find that there will be a certain number of absentees; you don’t need to pay for empty spaces. 15. Try brand X. Use a supplier’s own-brand products. This can reduce costs by up to 30 percent. 16. Pack it up. Printed cartons are expensive. Consider using plain ones, and sealing with printed tape instead.

12. Navigating Nonprofits Through Turbulent TimesTwenty one ways to better manage your business costs Ken Widelka (c) 17. Cut and coordinate. Clean up your database to reduce returned mail. Coordinate your marketing mail-outs to take advantage of bulk rates. 18. Shoot the messenger. Investigate alternate methods of disseminating information. Can you use E-mail rather than snail-mail? There are companies that specialize in distribution methods to suit your preferences. 19. Stop the presses. Always use standard paper sizes. Although printing larger quantities at one time means lower per-item costs, if you only need 7,000 brochures, it’s still cheaper to order that number at $3.30 per unit than it is to pay for 10,000 at $2.80. Companies tend to over-order to get the price down but then don’t use the stock.

13. Navigating Nonprofits Through Turbulent TimesTwenty one ways to better manage your business costs Ken Widelka (c) 20. Toss. Don’t pay to store boxes simply because you haven’t worked out whether you need to keep them. Review! 21. Investigate insurance. The time to investigate and negotiate your insurance policies is well before the renewal deadline. Make a note of when policies are due – unfortunately, many brokers wait until so close to the renewal date to contact their clients that there is little time left for negotiation or research.

14. Navigating Nonprofits Through Turbulent TimesTwenty one ways to better manage your business costs Ken Widelka (c) Dare to Dream Picture your organization relieved of some of its budgetary constraints. Imagine being able to buy a vehicle or start a fund to build a new facility, being free to attend important professional development conferences, buying the basics you need to fulfill your mission or even just bolstering your operating fund. Think of the positive impression you could leave on your donor base, and on the volunteer community, by announcing that you saved significantly on overhead expenses. This epitomizes responsible stewardship of the funds entrusted to you by your members and donors. Your financial acumen and fiscal responsibility can counter adverse publicity and set you apart from the multitude of other nonprofits competing for memberships and contributions of money and time. (adapted from Expense Reduction Analysts)

15. Ken Widelka (c)