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Nonprofit Cost Analysis - Step #2: Gather Financial Data

Published Date: 2009-06-03
Author(s): Marta Garcia Abadia    Johnny Lin


Once you have decided on the time period and programmatic scope of your analysis, you can begin gathering the relevant data accordingly.

Financial information required for a comprehensive cost analysis

Information to GatherSourceContact
1. All organizational costs, both program-specific (direct) and overhead (indirect) Organizational budgets and accounting reports Director of finance; CFO
2. Expenses incurred by each program, as reported by program headsProgram summary reportsProgram directors/officers
3. Number of employees (specified by full-time and part-time capacity) and summary of job responsibilities for each positionJob descriptions; payroll informationProgram directors/officers; human resources
4. Estimates of how staff members spend their time, by programTimesheets; interviews with staff, if necessaryProgram directors/officers; human resources
5. Estimates of infrastructure usage (e.g. facilities, equipment, IT licenses) by programRoom scheduling records; equipment logs; interviews with operations, if necessaryDirector of operations

 

The first two items provide you with the raw cost amounts that we will allocate in later steps, whereas items three to five provide information to help guide our allocations. If items four and five (breakdown of staff and infrastructure utilization by program) are unavailable through existing records, invest some time in conducting interviews. Not only is this data crucial for your analysis, it can also shed light on how effectively your organization is utilizing staff capacity –often the most expensive resource for nonprofits.

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