Financial Reporting in Non-Profit Organizations

Financial reporting in non-profit organizations involves documenting and presenting financial information to show how funds are raised and spent. Unlike profit-focused businesses, non-profits aim to fulfill a mission, using donations, grants, and fundraising efforts. Key reports include the Statement of Financial Position, which outlines assets and liabilities, and the Statement of Activities, detailing income and expenses. These reports help stakeholders, like donors or board members, assess financial health, ensure transparency, and make informed decisions about support and resource allocation. Proper reporting is essential for accountability and building trust within the community.