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Annual Reports: Five Keys to Creating an Annual Report for Your Nonprofit Organization

At the beginning of my second year as CEO of a housing non-profit organization, I thought I had prepared well for my first annual meeting until the day of the event when I realized that we had not produced an annual report as required. in our statutes. laws. Since this happened thirty years ago, before most nonprofits had computers, you can only imagine the work my secretary and I put in to produce the basic report we needed for that night. We comply with the requirement of the law, but we certainly did not produce something that our organization showed.

Fast forward three decades … you have a good computer and printer in your office, a staff member who writes well, and the wisdom to give yourself enough time to create an annual report that will serve as a marketing and fundraising tool in next year. Unless you have abundant resources at the bank or a marketing company donating your services, you will likely create your report in-house. Follow these guidelines to make sure your report ends up being “read and shared” rather than in the trash.

1. Determine the message that you want the report to convey.

You can do this by targeting a specific program that has had dramatic results this year. You can also focus on your mission and highlight a few things you’ve done that clearly resonate with that mission. Plus, you can highlight the people you serve with various programs or donors who have made this a great year. Just remember that this message needs to be consistent throughout the entire report, from the Board Chair’s opening letter to the closing financial report.

2. Avoid using too many statistics.

In the words of Mal Warwick, “If statistics could tell a story, calculators would be invited to talk shows.” Your auditor may be impressed by the numbers, but your annual report readers want to know about the people you’ve helped and the changes your nonprofit has made to make the world a better place.

3. Make sure to use a large number of stories.

If your orchestra offers free concerts for inner-city kids, focus on one child and talk about their reaction to the concert. If you provide shelter for rescued animals, talk about the rescue and then about the permanent home you found for the animal. If your mission is to help drug addicts recover, focus on one or two who have completed your program and show how they have become productive members of the community. Use any success story that matches your mission and it will grab the reader’s attention.

Four. Include pictures that are dramatic and show the work you do.

Avoid traditional group shots (board members, staff, and a neighborhood group) and use images that reveal strong feelings. For example, it could show joy on the face of a child listening to a live concert for the first time, the excitement of a new owner leaving the shelter with a rescued animal, or the joy of a former drug addict playing basketball with a group of teenagers. . . You can also include photos of board members and staff; just make sure they’re doing something active, like participating in a board meeting or working with clients. Spontaneous shots can be great if you get them. A word of caution here: make sure you get the clearances signed by the people photographed (or their guardians).

5. Present your financial reports in an interesting and readable way.

Most of the people who receive your annual report are not interested in your balance sheet or income statement. If you think you should include them, add a short description that highlights what the numbers really mean about running your nonprofit. What interests many readers is how much money they have spent on programs compared to the cost of administration or fundraising. The clearest way to report this is on a pie chart.

Once you’ve used these ideas to complete an annual report that has the potential to impress your readers, be sure to distribute it widely. Don’t just hand it out at your annual meeting. Mail it to all of your donors, partners, clients, and anyone who wants to take an interest in the work you do. Also, put it on your website for the whole world to see how the world is changing.

© 2010 Jane B. Ford

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