Financial Statement Preparation for Nonprofit Organizations
Accurate financial statements are important for nonprofit organizations to make data-driven decisions and to better understand the financial performance of the organization. Let us help you prepare the basic statements your organization needs.
Why Do Nonprofits Need Financial Statements?
Nonprofits are required to develop financial statements for two primary reasons:
IRS and government regulation compliance
Internal decision making
In order for nonprofit organizations to maintain their tax-exempt status, they must provide accurate financial statements to the government. Plus, financial statements provide the organization with a wealth of information regarding their financial health and performance.
The team here at RP Finance has many years of experience in creating financial statements for nonprofit organizations. Reach out to us for a free consultation to learn more about how we can help you!
4 Primary Financial Statements
There are 4 primary financial statements your organization needs to develop in order to remain compliant with the IRS and government regulations.
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The statement of financial position, or the balance sheet, provides information on the assets and liabilities of the organization on a specific date.
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The statement of activities, or the income statement, shows the financial activity of the organization over a period of time. This statement will provide information on activities such as funds received, operational expenses, payroll expenses, and the funds available to continue operations.
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The statement of cash flows tracks the inflows and outflows of cash from your organization over a period of time. For nonprofits, the statement of cash flows can be thought of as sources and uses of cash.
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The statement of functional expenses breaks down the expenses incurred by your organization based on each functional area, for example, program expenses, administrative expenses, and fundraising expenses.
Financial Statement Preparation
For many organizations, the thought of creating financial statements is as stressful as doing taxes, but they don’t have to be! Our goal is to ensure you stay compliant, without having to stress or spend time on the finances of your organization.
We will work with you and your team to prepare accurate financial statements. Reach out to us to learn more about how we can help you with financial statement preparation.
FAQs
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Financial preparation is included in all of our bookkeeping packages. Our most basic bookkeeping package starts at $499/month for organizations with 1-4 employees and an operating budget under $300,000.
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Yes, our team creates all four financial statements for your organization. The financial statements will help your organization stay compliant, as well as give you the information you need to make data-driven decisions.
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We update your financial statements every month to ensure you have up-to-date information on your organization and its financial health and performance. Having updated financial statements can also be helpful when looking for large donors that may request the information or for auditors that require the information.
