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What is a non-profit annual report? Why do you  need one, and what goes in it? In this video   we're going to talk all about how to create  an annual report for your nonprofit or social   enterprise organization that will keep inspiring  your donors your volunteers and members of the   general public to support your cause year after  year. Welcome or welcome back! I'm Amber Melanie   Smith. I'm a non-profit founder and executive  director and love to make these videos on YouTube   all about those topics: starting a non-profit,  fundraising, making a social impact, and more.   Don't forget to give this video a like if you  find it helpful, subscribe to my channel for more   content like this, and ring the bell for alerts  for the next time I post a video. If you're also   looking for resources on starting a non-profit  or how to develop a sustainable fundraising plan   be sure to check out the trainings on my website,  FounderToFullTime.com. Okay, I want to get started   with a little bit of a refresher for those of  you who are new to this concept -- what is an   annual report, and why does your organization need  one? Why is it a good idea for your organization   to publish an annual report each year? So in  essence, an annual report is a report that you   would publish and distribute to your stakeholders  - so probably your volunteers, your donors, your   leadership team, and their associates, and the  general public. And this report includes an update   on your organization's impacts from the year  prior as well as your organization's financial   status and status of your goals. This is not to  be confused for your organization's annual filing,   which at least in the U.S.A. is the document that  you would complete and submit to the IRS - it's   essentially your annual taxes. So why do you need  an annual report? Well it is a good idea always to   keep your general public your community informed  of what your organization is up to, but an annual   report is a great marketing tool that you can use  to showcase all of the good work that you did and   all of the good that you accomplished in the year  before and send that out to your folks. So this is   a tool that you can use to basically help people  feel justified in the support that they gave you   whether that was through giving their volunteer  time, or donating their dollars to your cause,   it helps them see essentially what you're able  to accomplish with the resources they invested   in your mission. A good annual report will  also help you build trust with your supporters,   because among other things, one of the things  that you will include in your annual report   is your financial status. This is typically the  revenue that you brought in and some of the things   that you spent the money that you raised on to  achieve your nonprofits mission this level of   transparency really helps the general public and  your supporters feel like you are accountable to   them so those are the basics around what an annual  report even is and what's purpose is what how it   helps your organization let's talk a little bit  about the logistics around when you would send an   annual report typically organizations will  send out their annual report and publish it   publicly about one or two months after the end of  their fiscal year so if you are on a traditional   calendar year for your organization's fiscal year  that would be January through February, I'm sorry,   January through December, and then you would  publish your annual report probably sometime in   the January to march time frame of the following  year and of course as we've talked about in other   videos your fiscal year can be any 12-month  period that suits your organization and its   cash flow so you could say it's July through  June you could say it's April through March,   it really doesn't matter, but as I said you're  probably sending out this annual report a couple   months after the last month of that fiscal  year each year. What format should your annual   report take? Let's talk about some options.  Traditionally annual reports that I've seen   are a pdf document and this is something that  could be either printed and mailed out through   snail mail or emailed or linked to on your website  but more and more there is a movement towards   different and more online accessible annual  report formats so what I mean by that is just   that you might choose to build your annual  report right into a web page on your website   and the advantages of this of course are it's a  little easier to view online and it encourages   sharing because people can just grab that link  and pass it on to their friends and networks   of course if your organization happens to serve  a population that is less internet savvy or has   less access to the internet than sending the snail  mail copies to those folks is a way to make sure   you can keep them included in your reporting  a couple of other interesting formats for   annual reports that we are starting to see include  interactive clickable presentations on web pages   those are always fun infographics so reports that  are more design and image heavy as opposed to text   heavy are always visually appealing in my opinion  i personally really love this example from girls   who code their 2018 annual report is just  beautiful and fun i will provide a link to   that in the description of this video if you kind  of want to just check that out and get inspired   and some organizations are even experimenting  with doing an annual report strictly through   a video format that includes you know obviously  comments from their leadership but also data and   storytelling there are really a number of tools  out there that you can use to create an annual   report for your organization i know i love Canva  it has some great templates that you can check out   no matter what your level of graphic design  skill may be it's a great resource and a lot   of the templates that they have are free also  of course sometimes google slides or PowerPoint   is is great for that too and if you're going the  video route there are a number of free or low cost   video editing tools out there for folks that don't  necessarily need a lot of experience to know how   to properly edit those videos okay so at this  point we've talked about what an annual report is   its purpose who it goes to when you would  send it and some of the possible formats   for how you would create it now let's talk a  little bit more in depth about what you're going   to want to include in your annual report for its  content there's a little bit of flexibility here   and like i said organizations are getting  creative about how they present their annual   reports so maybe you'll think of some  other things that you'd want to include   but in general a typical annual report will  include these six elements the first is a brief   message or letter from your most senior senior  leadership so this is often your non-profit's   executive director or board chair and sometimes  you can even have both so a letter from both your   executive director and your board chair second you  always want to include your non-profits mission   statement and vision statement even if you're  going to be sending this report to people that   you're fairly confident know your organization  well it's always a good idea to reinforce that   mission statement by putting it on all of your  materials whenever you get a chance third you're   going to want to include your organization's  current strategic goals what are some of the   things that you're trying to accomplish in the  future where are you going as an organization   this is something that you can include to inspire  people to think about how they could support your   future goals while they're reading about your past  accomplishments knowing where you're going will   create a sense of confidence that you know what  you're doing as an organization and that you are   working towards meaningfully addressing the social  or community issue that your nonprofit was formed   to address and pairing that with your explanation  of what you accomplished in the past year   just bolsters your credibility and on that  note the next thing you want to include is   what you accomplished in the past year you want to  talk about all of the good that you accomplished   in the past fiscal year and you want to do this  not only by sharing the numbers so how many people   you served or helped or meals packaged or whatever  your mission may be animals rescued for example   you want to include those numbers but you also  want to do some storytelling around these numbers   people connect emotionally more to stories  of an individual or one community that you   served as a non-profit so you want to balance  including both the data and the personalized   storytelling to make it a compelling annual  report i recommend once again if you're going to   use a lot of numbers presenting them in at least a  visually appealing way like through an infographic   including high quality photos is a must and as  i said before at least one but perhaps even a   handful of impact stories showcasing specific  individuals or animals or communities or   depending on your mission people that were  served by your organization over the past year   fifth you want to include your organization's  annual financial statement this is a breakdown   of your organization's revenue and expenses  on a high level on the revenue side you'll   see a lot of non-profits sharing the general  sources of the funds in categorical terms so   number of donations or amount of money that  came from grants amount of money that came from   um sponsorships amount of money that came from  individual donors or the government et cetera   so just those larger buckets is how a lot of  organizations will break down their revenue   nothing beats a good pie chart for this it just  really helps simplify this information and make it   visually appealing again and on the expenses side  a high level overview of how the money was spent   you can break it down by your main programs your  administrative expenses etc. talking about money   and your financial status as an organization  can be awkward and perhaps even feel a little   uncomfortable but just remember your donors are  looking to you to be transparent about how you're   spending the resources that they have trusted  you with so it's always important to do that   and there are ways of showcasing this as something  that is really critical to achieving your mission   which is what it's all about i really like how  charity water did this in their 2018 annual report   they didn't just break down their finances but  they framed the conversation around their finances   by just reinforcing that the money that they  raised was money that translated into impact   i'll leave the link to their report in the  description below if you want to kind of check   it out and see how they did that but i thought  it was really smart and a really impactful way   of reminding donors and supporters that this isn't  just money that they give that goes into an abyss   this is this is an investment that they are making  in tackling an important issue that helps people   the sixth and final major thing that you want to  make sure you include in your annual report is a   thank you for your major contributors and here's  the caveat for that you want to only do that if   you have their permission to share their name many  annual reports will list the organization's top   funders whether that is a grant foundation  or a corporate sponsor or an individual   donor but it's really important especially  with individual donors that you make sure   if you're not sure that you have their permission  to put their name in the report some donors i know   are very you know discreet they prefer to stay  anonymous and don't really like public recognition   so it's important for them to not be named so just  be very thoughtful and courteous about how you   approach listing your donors but it is a good idea  to list those who have the permission to do so   because that sort of adds a level of credibility  to your organization it says to the public look   at all these amazing supporters we  have don't you want to be one of them   um and it just it adds a level of uh officialness  if that's i don't think that's actually a word it   adds a level of officialness to your organization  and its fundraising efforts those are the six   components you want to be sure to include like i  said it's a little flexible so you could think of   interesting additional things that you might want  to include but just a couple of additional tips   here to wrap up in my opinion you should avoid  being too cold with your language that you're   using in your annual report i think it's much  better to use inviting warm personal perhaps even   depending on your organization's brand informal  language remember people who read your report   are human beings and they want to see the human  being on the other side of the report too so in my   opinion it's a good idea to stay away from overly  stuffy or corporate language in these reports   just reinforcing one more time to make your  report visually appealing nobody wants to read   10 pages of dense text so use you know lots of  color use your your organization's brand colors   use design elements use photos try to make it  visually interesting wherever you can and i said   this before also but just one more time try to  get creative think about ways you might make your   report stand out could you make it interactive  could you include a video what's going to work for   you that's really going to capture the attention  of your supporters and make your report memorable   i mentioned a couple of other annual reports  and resources throughout this video and like i   said i'll be sure to leave the links to those in  the description below if you want to check them   out for more inspiration okay i would love to hear  from you at this point are you creating your first   or second or third annual report this year  i'd love to hear your questions or ideas in   the comments i'm sure the rest of our community  of change makers would love to see those too   if you have a lot of experience grading   reports definitely include your tips below too   as i mentioned before if you are looking for  some additional training and help on starting   a non-profit or developing a sustainable  fundraising plan check out the trainings   on my website FounderToFullTime.com. I also have a  group on Facebook called Change the World or Bust,   where we have like a couple thousand people  from all around the world, it's awesome,   who are all interested in making a difference  in their own unique ways. And i invite you to   come join our community there. Finally if you're  looking for some just additional resources or   sometimes even funding leads and articles  on social impact trends I have a super cool   newsletter you can subscribe to that using  the link that I'll leave in the description   below as well and of course opt out anytime  you'd like. Thank you as always for watching   once again I'm Amber Melanie Smith  and I hope to see you next time, bye! you