Board Meeting Chart on Screen

Traditional financial reports don’t always communicate the story you want to tell. Data visualization brings data to life and gives new relevance to your numbers.

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Data Visualization Puts Some Pizazz Into Nonprofit Financial Reports

  • Jeff Roberts
  • 8/14/2018

“Let’s put the financial report at the top of the board agenda so we can get past the boring stuff and on to the things we care about.”

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Have you ever overhead a comment like this from a member of your board? Chances are, the average board member may not have the same understanding or passion for numbers that you do. And yet, as the CFO, controller, or treasurer of a nonprofit, you know that the numbers in your financial statements are critical — they can help you spot trends, make decisions, and plan for the future.

The problem with most financial presentations is that the “good stuff” is buried amidst column after column and row after row of data that doesn’t add significantly to the conversation.

If you’ve provided a full financial reporting package to board members in advance of your meeting, don’t waste their time presenting all of that information again. Consider what would happen if you instead had a brief but informative conversation with the highlights on a single page of graphically presented financial information.

We call this data visualization.

Bringing data to life

Data visualization is a general term that describes any effort to help people understand the significance of financial or operational data by placing it in a visual context. Patterns, trends, and correlations that might go undetected in text-based presentations can be exposed and recognized easier with dashboards and simple graphics. Data visualization can help you identify trends that basic comparative financial statements might overlook, and also help non-financial managers and board members in decision making.

Dashboards, metrics, and graphics can better explain how your organization’s finances tie in with its mission and strategies. Visual presentation of data can take a number of forms:

  • Graphs — Graphs can show relationships between multiple data points, but they should be kept simple and uncluttered.
  • Charts — Spacing, color, and orientation (horizontal versus vertical) can make all the difference in bar charts. Pie charts are often complicated and difficult to interpret — they should be avoided.
  • Text — Text can tell you what is important by focusing on a single, relevant fact. Data to support the text statement is available; you simply pull out what is important to your specific audience.

Using data to understand your organization

In the example below, revenue and expense trends and projections are reflected graphically, and then actual amounts are shown in summary tables. Some items in this dashboard that could be discussed with the board include:

  • Why revenue is trending below budget for every month so far this year.
  • What actions are being taken to reverse the revenue trend, or if the trend continues, what actions will be taken on spending cutbacks.
  • A key financial metric — months of cash and investments on hand — is reflected (along with comparisons) in the financial position section of the dashboard. This makes it possible to discuss the improvement in cash from the beginning of the year to present, while also mentioning the significant decline from the prior year balance, and why there was such a significant decline.

Dashboard graphic

How we can help

All the data visualization, financial reports, ratios, key performance indicators, benchmarks, and dashboards won’t tell you how to run your organization. Informative and engaging reports supply context for decision making and become a starting point for discussion to help move your organization forward. Imagine how much more positive and productive board meetings could be if your financials were the center of attention instead of a yawn-inducing necessity. CLA’s nonprofit professionals are ready with web-based accounting systems and technology strategies to help you make the move.