Need: Improve Finance Function Effectiveness
Service: Finance Department Assessment
Understanding the situation
The finance department of a $10 million behavioral health organization was under duress. Grants management was too cumbersome, requiring staff to spend far more time than practical tracking and reporting on grants, leaving little time to generate more strategic financial reports for organizational decision-making.
The six-person team always felt behind, and turnover was an issue. Management had tried makeshift tweaks with little success, so they engaged CLA to help the accounting department hit the reset button.
The operational improvement plan resulted in reduced turnover, accounting efficiencies, and a more financially informed organization overall.
Exploring the challenge
To get at the systemic issues, CLA performed a finance department assessment which included:
- Reviewing documentation of the team’s structure, roles, systems, and reports
- Conducting staff interviews and surveys to understand roles, processes, and how systems were being used to support each person’s work
- Evaluating the key financial systems to identify what was and wasn’t being used, how, and opportunities for improvement
- Soliciting ideas from finance and accounting staff to understand how they felt the department could improve
- Engaging program leaders outside the department to learn how they’d like to be financially informed and involved
CLA summarized the observations, gained input from other CLA nonprofit consultants, and presented findings and recommendations to the client. Together, they built a realistic implementation plan that took budgetary and resource constraints into account.
With an agreed-upon roadmap, the social service organization took specific action steps to transform the finance structure:
- Centralized grants management into one role
- Restructured the chart of accounts to track by location and grant so program staff could conduct more robust performance analysis and make more informed decisions
- Implemented time-tracking software, automating payroll allocations in the general ledger and freeing up time to code to grants, programs, and locations
- Stopped manual receipt gathering and accelerated month-end close with the help of an expense management tool