But, there’s a place in the nonprofit universe for a surplus in the budgets too. They can mean the difference between surviving a rough patch and being forced to close down. Having extra cash can help stabilize your nonprofit and absorb an unexpected delay in receiving funds, a shortfall in revenue for a special event, or unbudgeted expenses. You need to know how your nonprofit’s cash flows and what to do if the cash doesn’t flow. Before starting with what is, essentially, a future-oriented process – clarify the present context.

Annual Nonprofit Budget

This sample budget for nonprofits is a template for an organizational budget for a fiscal year. This includes program expenses, staff salaries, an operating budget and other expenditures. Once finalized you can create the nonprofit budget template in excel to make it easy for you to update next year. It helps them create and maintain a comprehensive budget plan that provides financial stability and supports their mission. Pleasant green shades on the cells perfectly focus attention, but do not distract from the cold counting. In this regard, you definitely will not lose it among other documents.

What Should Be Included In a Nonprofit Budget

• However, if you feel that it is more important to have a budget that is easier to create and that reflects past spending patterns, you may want to use a historical budget.
• Use this template to step into the financial stability and strategic planning that will enable your organization to make a lasting impact on the communities you partner with.
• Budgeting goes beyond crafting a financial blueprint; it serves as a roadmap guiding your organization in allocating resources wisely and achieving its objectives.
• Lastly, it’s rare that nonprofits have unlimited funds, so they need to be realistic and thoughtful about setting restrictions on what they can spend money on.

The approved budget then serves as a guide for financial activity in the months ahead. Budgets should not be written in stone, because the financial position of the nonprofit may change during the year. Non-profit organizations have different operational activities with profit companies.

What is a typical nonprofit budget?

This can be a daunting task for a new nonprofit because you do not have history to review, but there are some tips that can help make it easier. If you use accounting software to for your budget, there is the benefit of those budget to actual reports we discussed earlier. If you are still unsure https://nerdbot.com/2025/06/10/the-key-benefits-of-accounting-services-for-nonprofit-organizations/ of how to develop a budget, you can consult with a financial advisor or accountant. They will be able to help you create a budget that meets your needs and ensures that your nonprofit is financially stable. At a minimum, you will be creating and reporting on an operating budget. This is a standard accounting report that shows how much was budgeted year to date compared to how much has actually been spent.

#1 Annual Nonprofit Budget Template

• Program expenses include any costs incurred in service of your mission.
• This could include donations, grants, fundraising events, and any other revenue streams.
• Make sure you set aside enough time to gather information and discuss various elements of the budget.
• Below is a list of best practices that nonprofits should consider before starting the budget process.
• Your board of directors will see your budget at some point, but it’s important to know how involved they’ll be!

Once the initial nonprofit budget is prepared, it should be reviewed and approved by the organization’s Board of Directors. Work with your key internal and external stakeholders to create a nonprofit budget that is reflective of how you’ve done in the past and what you expect for the immediate future. Forecasting shouldn’t be a shot in the dark; rather, it should be a methodical process that takes into account all relevant information.

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• Looking to create a well-crafted budget for your nonprofit organization?
• So the budget document has to have the names of all the different origins of debt.
• Equally important are the indirect support costs that keep your programs running smoothly.
• This will help ensure that your estimates are accurate and that you’re on track to reach your financial goals.
• The use of budget worksheets will aid in tracking the income and the expenses of the organization, along with setting aside contingency funds for unexpected and uncontrollable circumstances.
• With this approach, you determine the anticipated funding from each fundraising source by multiplying the expected amount with the corresponding probability percentage.
• Before you create a budget, make sure you have a clear idea of how much you spend (and receive!) on a monthly basis so you can create accurate projections.

Timing could be affected by events, annual appeal revenue drives or large gifts. Note months that may have more revenue coming in or more expenses going out. Use this calendar to plan to pay certain expenses when you have the cash, or reserve enough cash to cover those expenses later. There are many resources around best practices including the Council of Nonprofits and AAFCPAs. Once you have a general idea 5 Main Benefits of Accounting Services for Nonprofit Organizations of how much money you need to bring in, you can start to develop a budget.

Successfully implementing a budget for non-profit organizations requires systematic effort. Including these costs in your calculations provides a more accurate picture of program sustainability. Clear policies about when and how to use reserves help prevent impulsive spending while ensuring funds remain available for genuine needs. While familiar, this approach might keep you from spotting opportunities for significant improvements.

Inflation is hitting nonprofits hard: Here’s what you need to know

While program expenses are the core of your organization’s mission, fundraising and administrative costs also need to be properly accounted for to keep the lights on. Therefore, it can be helpful to establish these first and figure out what’s left. Discover the power of budgeting with our free Printable Monthly Budget.