There’s reporting, and there’s reporting. Some people report for duty. Some news media present brainless rants as fact. Nonprofits must report clearly what and how they are doing.
During the American Institute of CPAs (AICPA) Not-for-Profit Industry Conference, Ben Aase and Marie Caputo said that good reporting increases credibility and gives nonprofits a chance to tell the story the way it should be told.
Part of that comes from understanding terms and concepts.
For example, a business model is the system an organization creates and uses to bring in resources and utilize them effectively to create and deliver value, achieve mission and build the capacity to endure. The business model should be visible in the measurement tool(s) used in reporting to gauge the degree to which the organization will be relevant in the future and stimulate a meaningful dialogue toward the question “How are we doing?”
When it comes to reporting, they suggested the following:
- Define reporting areas based on what a particular audience cares about;
- Write a succinct statement that establishes the overarching purpose for each reporting area; and,
- Expresses its importance to the organization’s abilities to execute on its strategies and fulfill its mission.
Further, they said the following are qualities of good measures:
- Objective and unbiased;
- Statistically reliable but inexpensive to collect;
- Qualitative and quantitative;
- Discriminating, because small changes are meaningful;
- Having identifiable influencers; and,
- Setting a standard of comparison.