About Financial Management
Financial management systems include the people, policies and procedures used to maintain control of finances and ensure that finances are used responsibly. A strong financial management system is necessary for day-to-day budgeting and operations, as well as for long-term planning and helps an organization stay in business and meet obligations to funders.
Comprehensive financial management systems include:
- Program and financial planning.
- Human resource management.
Good financial management systems:
- Focus on results.
- Support programming.
- Ensure accountability.
- Support decisionmaking.
- Monitor financial performance.
- Building a strong financial management system helps statewide afterschool networks achieve cost savings. For example, networks can identify the most efficient staffing patterns as well as charge appropriate overhead rates.
- Networks whose fiscal sponsor takes a lead role in financial management tasks can still approach that entity to discuss how the system works and whether there might be an opportunity to make modest adjustments to better suit the network’s needs.
Strategies to Support Financial Management
- Thoroughly review the terms and conditions of all grants and contracts to ensure that written documents accurately reflect all agreements with the funder. Pay close to attention to any restrictions on use of funds as well as the reporting requirements.
- Inform key staff members of milestones and timelines. Develop a monthly work plan based on objectives and deliverables specified in the grant or contract.
Create administrative systems to maintain records and account for how and where funds are spent.