Financial Management of Nonprofit Organizations
PADM 7324
University of Arkansas at Little Rock
Summer 2015
April 21, 2015
Professor:
Kimberly A. Aaron, Ph.D.
kimberly_aaron@sbcglobal.net
Phone: (972) 979-6005
Office hours: By Appointment
Class Meeting:
Tuesdays/Thursday, 6:00 p.m. – 10:00 p.m.
Course Description:
Understanding and managing the finances of a nonprofit organization is critical to its success. However,
in many instances, senior nonprofit managers have assumed their responsibilities with little or no
background in financial management. Capable clinicians, social workers, artists, and coaches who move
into managerial positions within their organizations may be relying upon the business professionals sitting
on their boards for guidance on financial issues. Frequently, these business professionals have little or no
background in nonprofit accounting and financial management. This course is designed to provide students
with a basic understanding of the primary financial management issues and decisions that confront
managers and board members in the nonprofit sector. While it may be helpful to have some basic
understanding of accounting principles, course content presumes that students have little or no experience
in accounting or financial management.
Course Objectives:
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Students will gain a working knowledge of key financial concepts and financial statement
preparation.
Students will be able to review and interpret basic financial and managerial reports.
Students will be able to make informed financial decisions that are consistent with and supportive
of the mission and overall strategy of a nonprofit organization.
Required Text:
Zielow, John, Hankin, Jo Ann, Seidner, Alan G. 2007. Financial Management for Nonprofit
Organizations. John Wiley & Sons, Inc. Hoboken, New Jersey. ISBN 978-0-471-71466-4.
In addition to the text, articles from journals available electronically through the library and other internet
accessible articles are assigned as readings throughout the semester. Students are expected to access the
articles themselves. It is suggested that you attempt to locate the articles in advance of the assigned reading
date.
Requirements & Grading:
Students are expected to attend class, arrive punctually, and be prepared to contribute to discussions. If
you know in advance that you will be more than 15 minutes late or unable to attend class, please alert the
professor via phone or email. Class participation is mandatory. Students should come to each class with
three issues/questions related to the day’s reading assignment, which they would like to have discussed in
class.
Students are responsible for ALL material presented in class. Some of the material presented in the
classroom may not be found in the textbook or course readings. It is your responsibility to get notes from
students after an absence. The professor will not provide class notes to students.
Students are expected to produce work of graduate-level quality. Students should construct clear and
deliberate arguments and present their work in a well-organized format. This includes careful attention to
grammar, punctuation, and spelling in all written assignments. Please run your papers through the spelling
and grammar check features of your word processing software prior to turning them in. If you use Microsoft
Word, consider using the grammar and style option under the Word Options feature.
Graded Assignments
In-class quizzes (three quizzes, two count toward grade)
Group project
Take-home final
Attendance and participation
30%
25%
35%
10%
Quizzes
Three quizzes will be given in class. Of these three, the lowest grade will be dropped and the remaining
two grades will each count 15% for a total of 30% toward your final grade. There will be no make-up
quizzes. If you miss class the day a quiz is given, that quiz will be dropped from grading regardless of
whether it is your lowest grade.
Quizzes will cover the material up to the preceding class. The material assigned for the day of the quiz will
not be included in the quiz that day. This is to ensure that students are grasping the fundamental concepts
essential to gaining a thorough understanding of nonprofit financial statements, prior to moving on to more
challenging concepts.
Group project
The group project will consist of teams established by the professor, which will select one local nonprofit
organization to research and present to the class. The nonprofit selected must have at least $500,000 in
revenue and file 990s. Please provide the name of the nonprofit your group has selected to the professor.
The presentation also will be provided to the professor for grading. Everyone in the group will receive the
same grade for the presentation. The types of information to be presented should include: description of
the organization, strategy for funding, analysis of its financial condition, a recommended budget for the
coming year, suggestions for the executive director and board to consider in future long-range planning
initiatives, and any other pertinent information that has been presented in the context of in-class discussions.
Take-home final
On the last day of class, you will be given a take home final. The take home final is expected to consist
of three to four essay questions that cover the material presented throughout the semester. This is NOT a
collaborative assignment. Each student must do his or her own work.
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Extensions & Special Exceptions:
No extensions are granted for written work. Late papers will be penalized one grade step. For
example, a paper that is deemed an “A” paper, but is late will receive an “A-” as a grade. Note that
unless otherwise specified, all assignments must be submitted in hard-copy during class meetings.
Email Communication Policy:
Email is an efficient and effective mode of communication, especially given the busy lives of
university students and faculty. Therefore it is recommended that students contact the professor via
email when appropriate. Please use “PADM 7324” in the subject line of any email sent to the
professor regarding this class. I do check email regularly.
Scholastic Dishonesty Policy:
Cheating in any form will not be tolerated. Suspicions of academic dishonesty will be investigated
and pursued to the fullest extent of the university’s policy.
Disabilities and Accommodations:
Your success in this class is important to me, and it is the policy and practice of the University of
Arkansas at Little Rock to create inclusive learning environments consistent with federal and state
law. If you have a documented disability (or need to have a disability documented), and need an
accommodation, please contact me privately as soon as possible, so that we can discuss with the
Disability Resource Center (DRC) how to meet your specific needs and the requirements of the
course. The DRC offers resources and coordinates reasonable accommodations for students with
disabilities. Reasonable accommodations are established through an interactive process among
you, your instructor(s) and the DRC. Thus, if you have a disability, please contact me and/or the
DRC, at 501-569-3143 (V/TTY) or 501-683-7629 (VP). For more information, please visit the DRC
website at www.ualr.edu/disability.
General Disclaimer:
The course syllabus may be amended at any time by the professor.
SYLLABUS: CLASS AGENDAS & READINGS
July 7
Introductions/Review of Syllabus
General Introduction, Chapter 1
Miller, Clara. 2005. “The Looking-Glass World of Nonprofit Money: Managing
in For-Profits’ Shadow Universe.” Nonprofit Finance Fund located at
http://www.nonprofitfinancefund.org/docs/The%20Looking%20Glass%20World
%20of%20Nonprofit%20Money.pdf
July 9
Basic Accounting Rules and Reporting
Chapter 6
3
IRS 990 Instructions located at http://www.irs.gov/instructions/i990-ez/ar02.html
(skim)
Wind, Kennard, Hager, Mark A, Rooney, Patrick, Pollak, Thomas H. 20004.
“Special Issues in Nonprofit Financial Reporting.” The Urban Institute located at
http://nccsdataweb.urban.org/kbfiles/540/Financial%20Guide.pdf
July 14
Financial Statements and Fundamental Ratio Analysis
Chapter 7
Needleman, Sarah E. 2005. “Finding the Silk Purse.” The Wall Street Journal.
November 6, page R6.
“The Busy Person’s Guide to Four Essential Reports.” Fieldstone Alliance
located at
http://www.fieldstonealliance.org/client/tools_you_can_use/05-1408_key_finance_reports.cfm
July 16
Financial Statements and Fundamental Ratio Analysis Continued
Hager, Mark A., Flack, Ted. 2004. “The Pros and Cons of Financial Efficiency
Standards.” The Urban Institute located at
http://nccsdataweb.urban.org/kbfiles/521/brief%205.pdf
Quiz 1
July 21
Structure, Internal Controls and Transparency
Chapter 4
Sloan, Margaret F. 2009. “The Effects of Nonprofit Accountability Ratings on
Donor Behaviors.” Nonprofit and Voluntary Sector Quarterly. Vol. 38,
No.2.
Walsh, Dennis. 2009. “Tracking Volunteer Time to Boost Your Bottom Line: A
Complete Accounting Guide.” Nonprofit Finance & Strategy. March 11.
(Will be distributed in class the prior week.)
July 23
Liquidity Management
Chapter 2
Quiz 2
July 28
Budgeting and Short-Term Planning
Chapter 8
Bedsworth, William, Gregory, Ann Goggins, Howard, Don. 2008. “Nonprofit
Overhead Costs. The Bridgespan Group located at
www.bridgespan.org/WorkArea/linkit.aspx?...&ItemID=1074
July 30
Long-Range Planning
Chapter 9
Rouson, Brigette. 2005. “Business Planning for Nonprofits: Why, When – and
How it Compares to Strategic Planning.” The Newsletter of the Alliance
for Nonprofit Management.” Vol. 2, No.1. Alliance for Nonprofit
Management located at
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http://www.allianceonline.org/assets/library/7_businessplanningfornonp
ro.pdf
Quiz 3
August 4
Liability Management
Chapter 10
Group Project Presentation
August 6
Cash and Investment Management/Recap and Debrief
Chapters 11 and 12
“Principles of Nonprofit Investment Management.” Common Fund Institute
located at
http://www.commonfund.org/Common/RESOURCE_REQUEST/target.
pdf?RES_GUID=CCAB0290-1E05-40D4-98BA-1AEBF9BF533E
“CFO Fitness Quiz: Are You Tough Enough for the Caring Sector?” Bridgestar
located at http://www.bridgespan.org/cfo-fitnessquiz.aspx?parentID=238&taxid=322
Take-Home Exams Distributed
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