Many finance managers wish they could spend more time actually planning – thinking about the business and contributing to strategy. Instead they feel bogged down by the basic-level bookkeeping, correcting mis-codings, chasing paperwork and producing endless spreadsheets. Sayer Vincent take you through how to improve your charity finance function.
So where to start? Break the overall task down into a series of manageable steps. You do not have to do them in a strict order and your own particular circumstances might help you to focus on the right area first.
1. Free up some time
A good first step is to stop doing something so that you can free up some time. Consider some of the reports you write – do people actually use these? One way to find out is to stop sending them – see if anyone notices! More seriously, it is possible to ask for a moratorium and you can pick the time when you do this – first quarter management accounts comparing actual to budget do not usually reveal much and so may not be missed by managers.
2. Analyse existing data
Could you analyse existing data further and present it a different way in order to provide some useful information for managers? This does not have to be complicated – a recent example was some analysis that a new finance manager undertook for a charity. He showed managers the level of take-up needed for a particular type of project to breakeven. The managers were astounded, as they had been asking for similar information for years and had always been told it was too difficult. Now they could look at their decision-making process afresh and develop clear financial criteria for closing projects and opening new ones. This was an important step for that finance manager, as he now has credibility with other managers.
3. Reduce the number of errors
It is frustrating for finance departments and other staff to waste time sorting out mistakes. Even if the error is caused by staff outside the finance department, it still reflects on finance and undermines the confidence others have in their work. Having demonstrated that the finance department can add value, you can now ask others to make changes to the way they do things. You will need to find out the cause of the errors. In one example, the cause was an old print out of the chart of accounts which was completely out of date, so people were using the wrong codes. For years, the finance staff had simply been correcting these codes.
To read the full Directory of Social Change article click here.
Source: The Directory of Social Change