NEW YORK UNIVERSITY ROBERT F. WAGNER GRADUATE
P11.2142 FINANCIAL MANAGEMENT FOR NONPROFIT AND
NGO ORGANIZATIONS
Instructor: David MacDougall
dmd2028@nyu.edu
Fall 2008
DESCRIPTION
This course addresses the practical challenges of managing financial risk and reporting in
nonprofit and nongovernmental organizations. Topics include all major areas of financial
management with a special focus on problem solving and decision making. Class
exercises strengthen the student’s ability to assess financial issues and to concisely
communicate risks and opportunities to stakeholders.
PREREQUISITES:
Coursework: P11.1021
Technology: The course requires effective use of Word and Excel (or similar
professional software). I expect that students are familiar with Excel
formulas (absolute and relative) and functions. I strongly recommend that
students who do not already have office software purchase the suite of
Microsoft Office products at the NYU computer store where they are
available at a deeply discounted price. If you are new to Excel you should
consider buying a good basic an (Excel for Dummies or Idiots Guide).
They have all you need to be successful in class.
Required Texts
 Zietlow, Hankin, Seidner, Financial Management for Nonprofit Organization, John
Wiley & Sons Inc, New York 2007
Optional Texts
 Steven A. Finkler, Financial Management for Public, Health, and Not-for-Profit
Organizations, Prentice Hall, Second Edition 2005 (used in P11.1021 core finance
course).
 Dropkin and Hayden, The Cash Flow Management Book for Nonprofits Jossey Bass,
2001
 Businessweek - http://www.businessweek.com/
 The Economist – A wonderful news magazine with a focus on economics and
finance. https://www.economistsubscriptions.com/searchstudent/us/ . People wanting
to work internationally should read this magazine thoroughly. It is the only magazine
I know that provides analysis of the global implication of many trends.
Grading
 30% group project
 35% of your grade will be based on the homework assignments.
 35% on the final exam.
Page 1 of 8 Version 1
P11.106753599
Group Project
The group project consists of an in-depth analysis of a nonprofit or NGO. The ultimate
product of the analysis will be a memo (4,000 to 5,000 words) and a 30-minute class
presentation addressing financial challenges and policies. See the attached sheet
describing key elements of the project.
Final Exam
 The take-home final exam will consist of a few short answer questions and an
analysis of nonprofit facing significant challenges.
 Students will be required to demonstrate a thorough mastery of financial terms.
COURSE OUTLINE AND TOPICS
Class 1 – Introduction
Introduction to the course and instructor. The class includes a discussion of standard
office software and professional communication.
Assignment:
Student Survey - submit by Sunday
Spreadsheet:
Exercise 1 (Basic formatting and formulas)
Class 2 – Overview of nonprofit organizations and non-governmental organizations
With over one million nonprofits in the US, students need to understand the regulatory
landscape and legal structures. The class deals with the nature of nonprofit and NGO and
describes the process for creating a nonprofit 501(c)(3).
Reading:
Optional Reading:
Spreadsheet:
Chapter 4, 4B
Chapter 4A (example of By-laws)
Claire Gaudiani Chapter 1
Projecting financial performance and communicating implications
Class 3 – Role of the CFO (Joan Koenig guest speaker)
A chief financial officer with international and domestic expertise will discuss the
responsibilities and challenges of working effectively as a CFO.
Reading:
Assignment
Project
Chapter 5
Nonprofit CFO by Russ Pomeranz
None
Groups established.
Class 4 - Financial Statement Analysis and Ratios
A review of basic nonprofit financial statements and GAAP. Issues include US and
international accounting standards and the Federal form 990
Reading
Articles
Review
Optional Reading:
Assignment:
Chapter 6, 7 (see 7A and 7B for examples)
WSJ on International vs. Domestic accounting Standards
Women’s World Banking 2005 Audit
Baspana 2004 Audit
Finkler, Chapters 10 and 12
WNYC Balance Sheet Questions
Page 2 of 8 Version 1
P11.106753599
Class 5 - Financial Statement Analysis and Ratios
Continued review of basic nonprofit financial statements and GAAP. The class will
include a discussion of benchmarking and ratio analysis.
Reading
Assignment:
Project
See reading for class 4
WNYC Statement of Activities and Cash Flow
Submit HARD COPY of the audited financials and a brief memo
describing your chosen organizations, why you chose it and the
sources of information you have identified.
Class 6 - Liquidity
Maintaining adequate liquidity is one of the key responsibilities of financial managers.
This class addresses the importance of liquidity management through the cash flow
budget. It will also include a discussion of the challenges of and elaborate on
determining liquidity from audited financial statements.
Reading:
Optional Reading:
Assignment:
Chapter 2, 11
Finkler 6
Create cash flow budget based on Exhibit 6.4 in Dropkin and
Hayden (See Blackboard)
Class 7 - Debt
Borrowing can create improve efficiency and effectiveness. It can also place an
institution in financial jeopardy. The class will review the basics of borrowing and
associated risks.
Reading:
Assignment:
Chapter 10
None – However this will be a major aspect of the final
Class 8 – Investments and Endowment Management
Many nonprofit institutions benefit from endowments. This class will outline investment
strategies and endowment spending policies,
Reading:
Assignment:
Chapter 12
Endowment & Expansion of Building Improvements
Class 9 - Fund Raising
With the increasing number of nonprofits in the US, competition for funding has grown
rapidly. Virtually everyone in a nonprofit, especially the CFO, must understand the
basics of fundraising. The class will provide an overview of fund raising for nonprofit
organizations in the US. Topics include: annual campaign, capital campaign,
telemarketing, direct mail, special events, planned giving, foundations grant making and
the vital role of board members.
Reading:
Assignment
Seltzer 6, 15
Review you projects fund raising strategy. Remember to discuss
this in your group presentation
Page 3 of 8 Version 1
P11.106753599
Class 10 – Operating Budgeting and Reporting
The class reviews the annual budget process, cost allocation and capital budgeting.
Reading:
Assignment:
Chapter 8 , 9
TBA
Topic 11 – Risk Management
We will discuss operational and financial risk. A CFO of an international organization to
discuss relevant issues
Reading:
Assignment:
Chapter 14
Girls in Need
Class 12- Internal Control & External control, Sarbanes Oxley
The class will track the causes of the implementation of the Sarbanes-Oxley law. We
will discuss how Sarbanes Oxley might affect nonprofit organizations.
Reading:
Assignment:
Reading on Enron
None
Class 13 & 14 - Group Presentations
Groups 30-minute presentations.
Page 4 of 8 Version 1
P11.106753599
Project Outline
Group Project
The group project consists of an in-depth analysis of a nonprofit or NGO. Students
interested in international issues should work with me to identify an appropriate
international institution. The ultimate product of the analysis will be a memo and a 30minute class presentation discussing the organization, its financial challenges and
policies. Significant milestones in the group project will be:




Create groups of 3 by the 3rd class (I will set aside time at the end of the second class
to form groups).
By the fifth class groups submit a brief memo describing their selected organization
along with a copy of the most recent audited financial statements or 990. Students
must be careful to choose an organization that will provide adequate information.
In the next week groups schedule a follow-up 1-hour meeting with me for a
preliminary discussion of the organization. Students must prepare a brief presentation
that highlights challenges they face and questions they have. Students should pay
special attention to the ability to develop mission statistics.
Students will submit the final report by the 10th class and will prepare a group
PowerPoint presentation in the last classes of the semester.
Please feel free to ask me about the project. I will make the answers available to all
students on Blackboard
Memo (5,000 words maximum)
The memo should provide enough information to understand the organization, its mission
and its financial challenges. Topics should include: historic and current financial
performance, budgeted and projected financial performance, mission statistics and
effectiveness. The memo should focus on your analysis and conclusions
While your memo will surely include descriptive information, your conclusions are the
key result of the project.
Topics to include:
 Profitability
 Viability
 Liquidity
 Mission performance
 Fundraising
 Relevant risks and risk management
 Compensation
As a part of your analysis remember to review the organization’s 990. Familiarize
yourself with the 990 by completing the tutorial. “How to Read the 990 Form”
http://www.npccny.org/Form_990/990.htm
Page 5 of 8 Version 1
P11.106753599
Spreadsheet
Create a spreadsheet that analyzes the financial performance of the organization along
with its mission statistics. The spreadsheet should have 3 to 5 years of history. You
should make prudent use of graphs and formatting.
You may use as many ratios as you wish. However you should use no more than 5 ratios
as keys to understanding the dynamics of the organization. You should identify
appropriate benchmarks for your ratios. Please understand that your project is not about
ratios.
PowerPoint
No more than 15 PowerPoint slides should accompany your presentation. The slides
should highlight your opinions and conclusions. Students must show good
communication skills in the class presentation: speak clearly, be concise and stay within
the time limit. Students should practice the presentation before doing it in class. It will
build your confidence and help you stay within the allotted time. DO NOT EXCEED 25
Minutes. Leave 5 minutes for questions.
Distribution & Class Feedback
Your memo is due by the 10th class. I will post your report and spreadsheet in
Blackboard. Your fellow students are required to read the documents in preparation for
your presentation. I will ask them to make useful comments on the reports and
presentation.
It is possible that these classes may run an extra 10-15 minutes. Please be prepared to
stay.
Page 6 of 8 Version 1
P11.106753599
Guidelines for Homework and Final Examination
In the course I try to establish a work-like environment. Consequently all written
assignments must be in memo format providing concise conclusions and practical
solutions. Students must submit all homework assignments by e-mail ON THE
TUESDAY FOLLOWING THE THURSDAY CLASS. I do this so I can provide timely
feed and discuss issues on Thursday. Students must follow the following conventions
when submitting homework:

File Names - last name and then a concise description of the homework. For
example: Jackson – Homework 1.xls

Written work
o Submitted in a form easily imported to Word 2003
o Written work should:
 Focus on conclusions. A simple recitation of facts is not useful
 Be single-spaced and submitted in a memo style.
 Use Times New-Roman 12 font or Arial 11
 Include page numbers and your name on every page in a footer
 Do not exceed the word count provided with each assignment.
 Longer is not better.
 Use graphs and tables.

Excel
o Submitted in a form easily imported to Excel 2003
o Each page must print neatly on 8.5x11 paper. Include your name, file
name and page number on each page. You should learn how to use
Headers and Footers in Excel: Print Preview, Setup, Custom Header or
Custom Footer.
o All numbers must be properly formatted. Improperly formatted
spreadsheets will be returned to students and marked as late.

PowerPoint presentations
o Submitted in a form easily imported to PowerPoint 2003
o Presentations should be concise with appropriate use of graphs and tables.
Page 7 of 8 Version 1
P11.106753599
New York University
Calendar for Academic Year 2008-2009
September
02
Tuesday Opening of fall term.
15
Monday ALBERT initial registration ends
16
Tuesday Refund schedule for courses dropped during the third calendar week
of term (September 16-22). 55% tuition less nonrefundable service fees
22
Monday ALBERT drop-add ends.
29 – 10/1
Rosh Hashanah – Monday, Tuesday & Wednesday
October
01
Wednesday Last day to file master’s applications for admission with
scholarship consideration for spring 2009 terms
03
LAST DAY FOR TORCHTONE (212-995- 4747) GRADUATION
APPLICATION FOR JANUARY 2009 (June 9-October 3.)
06
FIRST DAY FOR TORCHTONE GRADUATION APPLICATION FOR
MAY 2009 (Application Period: October 6-January 30.)
8-9
Yom Kippur – Wednesday & Thursday
13-14
Monday/Tuesday Fall Break: No classes scheduled.
24
Friday
November
15
Saturday Last day for filing admissions applications for spring 2009 term
17
Monday ALBERT initial registration begins for spring 2009 term
26
Wednesday Legislative Day (classes run on a Monday schedule.)
27-29
Thursday-Saturday Thanksgiving recess
December
11
Thursday Last day of classes
12
Friday
15-19
Monday-Friday
Midterm Grades Deadline
Reading Day
Fall term examination period
Page
P11.106753599