Operating Budget

This is an organizational roadmap for how money is going to come in / go out, typically throughout the fiscal year. It shows us how an organization organizes their financials and how money is expected to move throughout the twelve-month period. To think of an operating budget personally, it would be like considering all of your anticipated expenses and income for the year — paychecks, mortgage/rent, debt, vacations, savings, utilities, etc. — and organizing it all to make sense of your total annual financial landscape, ensuring you have enough funds to do all you aim to do.

This document should:

• include all expected expenses and revenue

• account for reserves, savings, or investments made

• be informed by prior year behaviors

• account for reasonable adjustments (e.g. cancelled fundraiser)

• yield a projected balance of or near $0 (those with planned deficits should explain)

Why do we ask for this? On its own, an operating budget tells us the forecast of your operating year and what your expectancies include. It also shows us the extent to which our award or partnership might impact your operating budget, and how the initiatives, needs, or projects described in your proposal are integrated into the budget of the organization. Additionally, with previous year Statement of Activities (see below), we can see how an organization has grown or changed over time, and/or how strategies have shifted with the organization.

Statement of Activities (e.g. Profit-and-Loss)

This document, also known as a profit-and-loss statement, communicates how much money has been made and how much has been spent, during a period of time (e.g. the last year). To think of this personally, it would be like capturing any personal income (e.g. monthly salary, garage sale, work reimbursement) and any expenses (e.g. rent, groceries, date night, utility bills, credit card payments, etc.) in a given period of time, like a month or a year.

This document includes all revenue in a given period, such as:

• Donations

• Grants

• Investment income

• Event revenue

And all expenses paid or incurred in a given period, such as:

• Payroll

• Rent

• Insurance

• Vendors

Why do we look? This document helps us understand what’s happening with income/spending over time, identifying where dollars typically move, how, and to/from what source. It gives us a more complete sense of your organization’s behaviors and operational priorities.

Statement of Financial Position (e.g. Balance Sheet)

This is a snapshot of what your organization owns and owes at a given point in time (in the for-profit world, this is called a Balance Sheet). If you were thinking of this personally, it would be like assessing anything you own that has value (e.g. car, house, furniture) and that which you still owe money on (e.g. credit cards, mortgage, student loans) at a given moment in time.

This document should clearly communicate a dated moment of time, and include:

• Total Assets: cash, property, equipment, formally pledged donations, investments, accounts receivable, etc. (note: it is important to also capture restricted vs. non-restricted assets)

• Liabilities: debt, outstanding payroll, pending reimbursements, outstanding vendor payments, etc.

• Net Assets: the difference between what you own (assets) and what you owe (liabilities). If Assets-Liabilities is a negative number, we may ask you to explain how/why that’s the case.

Why do we look? This document helps us understand your organization’s financial health, and your ability to manage liabilities responsibly. Typically, assets should be greater than liabilities. If that’s not the case, we may be concerned about your operational health long-term.

IRS Form 990

The Form 990 is an important document that verifies financials as submitted to the IRS. This document helps us to confirm organization funding eligibility, good standing with the IRS, and other financial variables that may not be included in the documentation above.

Other Documentation

In rare circumstances, we may ask an organization for additional documentation. Should that be the case, we will work to explain what financial details we are looking for and be clear about why we need them. If you have questions about this, please reach out to your Program Officer for clarification or assistance.