Financial management in context
Financial management is one of many critical functions in an effective NGO.
NGOs exist to improve the lives of beneficiaries by carrying out activities as described in What NGOs do. Finance is a support function to make that possible.
In addition to financial management, a healthy NGO needs proper governance and leadership, clear strategic direction, high quality programme management with involvement of beneficiaries, effective human resources management, shared values and a conducive organisational culture.
All of these have linkages to financial management. For example,
- The Governing Body has ultimate responsibility for approving the budgets and financial statements and ensuring adequate financial control.
- Without a clear strategic plan it is impossible to draw up activity based budgets.
- The methods you use to recruit, induct, and train staff will have an impact on the effectiveness of your finance staff, and whether there is a culture of accountability in the organisation.
- The values that drive your strategic direction and programme approach will also be reflected in the way you manage the finances.
Mango’s Guide will help you to improve your financial management and see the connections to other aspects of effective NGO work.
But fundamental weaknesses in any of these other areas will have a knock on impact on your financial management because they are all inter-related.
Financial management is one piece of a big inter-linked jigsaw puzzle.
For specific help in these other areas, follow the links below:
|Human Resources Management|
Also in this section of Mango's Guide, find out about:
- What NGOs do - development objectives and activities
- Integrating financial management - why and how to get non-financial staff involved in the finances
- Improving your financial management - advice on taking a holistic approach