Even though nonprofit organizations aren’t required by law to publish annual reports, most nonprofit leaders recognize the value annual reports can provide. A well-written annual report will help you demonstrate your accomplishments to current and future donors, cultivate new partnerships, and recognize important people. Nonprofit managers working on annual reports most frequently ask these five questions.
Do we Really Need an Annual Report?
Yes. You don’t need a beautiful, full-color, glossy 40-page production, but you do need some sort of accounting of the organization’s work over the past year. Even if it is only a two-page flyer you photocopy or a document sent via your email newsletter, you should get in the habit of producing an annual report.
What’s the Most Important Part of an Annual Report?
The most important part of a nonprofit annual report is the description of your accomplishments. We want to know what you did, but more importantly, we want to know why you did it. What were the results? Why did you spend your time and money the way you did? What difference did it make? Don’t assume that readers will automatically understand how your activities help you achieve your mission. Connect the dots for them.
What Needs to go in the Financial Section?
The financial section of a nonprofit annual report should clearly explain where revenues come from and how they are spent. It’s also helpful to include pie charts, bar graphs, or other visuals that help readers see the big picture and understand financial trends. A short narrative description is also essential, explaining in plain English the meaning behind all those numbers.
How do we Handle the Donor Lists?
Organize your list of donors however it makes the most sense for your organization. Most nonprofits organize donors by contribution level and then alphabetize each of those lists. You can also alphabetize the full list without regard to donation level.
Samples of Annual Reports for Nonprofits
Sending out an Annual Report to your donors can be a great way to both keep donors engaged after year-end and to share your impact with those that care most about your organization. Putting one together from scratch can be overwhelming, so the pro fundraisers at Network for Good have created a quick and easy template to help you tell your organization’s story. Follow this link to download your customizable nonprofit annual report template today.