Build a Better Mentoring Program Budget featuring Michael Anderson, Non Profits Assistance Fund; July 6, 2011; part of monthly Quality in Action webinar series hosted by the Mentoring Partnership of Minnesota.

1. Build a Better Mentoring Program Budget
July 6, 2011
Quality in Action
Salaries &
Benefits
Background
Checks
Professional
Development
Liability
Insurance
Activities &
Training
Facilities &
Supplies

2. Webinar Logistics
Asking Questions & Sharing
Comments During the Webinar
 “Raise your hand” & MPM Organizers
will unmute you
 Or, type questions (and comments) in
the question/answer section and
submit; we will respond directly to you
or possibly share your question with
all attendees
 When unmuted, please monitor your
background noiseApril Riordan
Director of Training and
Community Partnerships
Recordings of past webinars are available on our YouTube Channel.

3. Elements of Effective Practice
 Recommendations
 Manage program finances
 Design a resource development plan that allows
for diversified funding
 Seek in-kind gifts
 Hold special events
 Solicit individual donors
 Seek corporate donations
 Apply for government funding
 Seek foundation grants

4. Quality Mentoring
Assessment Path
 Develop a program budget that
includes funds for mentoring
program staff compensation, staff
professional development, program
expenses and activities and all
other operations costs.
 Establish a system for managing
program finances and cash flow.
 Research and understand the
program’s requirements for
auditing.
 Determine and periodically review
the amount of funding needed to
sustain the mentoring program.
 Establish a resource development
plan that includes diverse sources
of potential funding.
 Develop mutually beneficial
partnerships and collaborations
with other organizations.
 Understand and follow
ethical, professional and legal
standards related to fundraising.

5. Our Panelist
Michael Anderson
Training Program
Manager and Loan
Officer

6. Build a Better
Mentoring Program Budget
Developed by Nonprofits Assistance Fund

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Who We Are
Nonprofits Assistance Fund’s mission is to build
financially healthy nonprofits that foster community
vitality.
Our financial experts help nonprofits strengthen their capacity to
address unexpected events, finance new opportunities, and
realize strategic goals. We fulfill our mission by helping you
thrive.
Find out more at www.nonprofitsassistancefund.org.

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Goals for Today’s Webinar
1. Understand the purpose of budgeting
2. Discuss the role of budgets in planning
3. Review budgeting roles and responsibilities
4. Review the steps in annual budgeting

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A Budget Is…
A plan
An idea of future likelihood
A wish list
The numbers that reflect program and management
priorities
A set of assumptions about the year
The allocation of resources among alternative
choices
A best guess working draft for the future

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10 Steps of Budgeting
Determine
timeline
Agree on
goals
Understand
current
financial
status
Agree on
budget
approach
Develop
draft
expense
budget
Develop
draft
income
budget
Review
draft
budget
Approve
budget
Document
budget
decisions
Implement
budget

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Step 1: Determine Timeline
Set target date for board approval
Allow time for each step and for review and
discussion
Approve before beginning of fiscal year

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Step 1: Determine Timeline
Determine
timeline
Agree on
goals
Understand
current
financial
status
Agree on
budget
approach
Develop
draft
expense
budget
Develop
draft
income
budget
Review
draft
budget
Approve
budget
Document
budget
decisions
Implement
budget
Board and/or
committee roles

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Step 2: Agree on Goals
Prioritize program delivery goals
Set organizational financial goals
Clarify annual goals from strategic plan

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Step 2: Agree on Goals
Mission
Organizational Principles
Strategic Plan
Tactical or
Business Plan
Budget and
Work Plan

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Step 2: Agree on Goals
Program goals
Goal
Budget
impact
– Increase youth program to
two new elementary schools
– New staff
– Travel costs
– Youth stipends

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Step 2: Agree on Goals
Organizational goals
Goal
Budget
impact
– Build cash reserve to two
months of expenses
– Must have surplus

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Step 3: Understand Current Financial Status
Review current year income and expense compared
to budget
Forecast to the end of the year
Analyze and understand any variances

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Step 3: Understand Current Financial Status

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Step 4: Agree on Budget Approach
Assign roles and responsibilities
Agree on authority to make decisions
Agree on how much uncertainty can be included (how
many unknowns)

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Step 4: Agree on Budget Approach
Approaches
• Bottom up budgeting
– Gather input and combine
• Top down budgeting
– Establish overall budget and assign
• Combination

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Step 5: Develop Draft Expense Budget
Determine costs (expenses) to reach program goals
Determine costs to reach organizational and strategic
goals

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Step 5: Develop Draft Expense Budget
What will stay the same as last year?
What will be different?
• Mandatory expenses
• Fixed expenses
• Variable expenses

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Step 5: Develop Draft Expense Budget
Expense considerations
• Cost increases due to inflation and price changes
• Changes in variable expenses due to changes in
programs
• Changes in expenses needed to achieve specific goals,
such as marketing or development
• Contractual changes in expenses such as rent
• Changes in expenses to build organizational
infrastructure
• Building in cushions or contingency amounts

24. Step 5: Develop Draft Expense Budget

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Step 6: Develop Draft Income Budget
Project income based on current fundraising and
revenue activities
Project new income based on new activities

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Step 6: Develop Draft Income Budget
Grants
Contributions
Special events
Contracts
Earned income

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Step 6: Develop Draft Income Budget
Income considerations
• Are there changes to current sources of funding?
• Are there changes to formulas, amounts, or criterion?
• Review the overall economy and your area of service

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Step 6: Develop Draft Income Budget

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Step 6: Develop Draft Income Budget

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Step 7: Review Draft Budget
Verify that the draft meets program and
organizational goals
Review and discuss all assumptions
Make adjustments, based on goals and capacity, to
match income and expenses
Review final draft for all goals and objectives

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Step 7: Review Draft Budget

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Step 8: Approve Budget
Present to any committees as needed
Present to the board for approval
Committee and board review and approve
assumptions as well as the numbers

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Step 9: Document Budget Decisions
Create a consolidated budget spreadsheet and file
Write down all assumptions

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Step 10: Implement Budget
Assign budget accountabilities
Incorporate into accounting system
Monitor and respond to changes as needed

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Step 10: Implement Budget
Evaluating the budget
• Compare actual income and expenses to budget
• Understand variances
• Complete a midyear projection of probable financial
results for the year
• Changing the budget

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Step 10: Implement Budget

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10 Steps of Budgeting
Determine
timeline
Agree on
goals
Understand
current
financial
status
Agree on
budget
approach
Develop
draft
expense
budget
Develop
draft
income
budget
Review
draft
budget
Approve
budget
Document
budget
decisions
Implement
budget

38. Resources
 Nonprofits Assistance Fund

39. Other Resources
 This presentation & others
www.slideshare.net/traininginstitute
 MPM Training
www.mpmn.org/traininginstitute
 Web sites & PDFs
www.delicious.com/traininginstitute

40. Next Quality In Action Webinar
Featured panelist:
Sarah Kremer, Program
Director, Friends for
Youth, Inc.
August 3- Coming
Together Across
Cultures: Intentional
and Skillful
Relationship Building
The notion of cultural competency elicits
deep emotions for most people and carries
tremendous weight in a professional
setting. Those who work with a diverse
group of clients want to be more skillful in
their relationships, but many workshops
offer little beyond tips for generalized
cultural populations (“making eye contact is
disrespectful for this group”) or suggestions
to create materials in more than just one
language. While these steps are necessary
in developing cultural competence, we
need to go deeper into exploring personal
cultural values and how to use them
intentionally and skillfully in building adult-
youth mentoring relationships.