Promoting Your Nonprofit with Your Annual Report
September 1, 2022

Do you think about your nonprofit’s annual report as a yearly obligation or even an unpleasant chore? If so, your annual report likely isn’t much fun to read — and you’re missing a chance to attract and engage critical audiences. Instead, embrace this opportunity to communicate the good your organization does and promote your mission and programs. Here’s how to write an annual report that will keep readers’ attention.

Tackle First Things First

Most nonprofit annual reports consist of several standard sections, starting with a Chair of the Board’s letter. This executive summary needs to provide an overview of your nonprofit’s activities, accomplishments and anything else worth highlighting. It should be direct and to the point, but also reflect the chair’s personality.

Financial information is another essential section. This generally is subdivided into three sections:

  1. Independent auditor’s report. This CPA report states whether your nonprofit’s financial statements have been prepared in accordance with Generally Accepted Accounting Principles.
  2. Financial statements. Data should include a Statement of Financial Position (assets, liabilities and net asset categories as of the last day of the fiscal year), Statement of Activities (revenues earned and expenses incurred during the year) and Statement of Cash Flows (changes, sources and uses of cash for the year).
  3. Footnotes. These expand on financial statement items regarding subjects such as leasing arrangements and debt.

You can make your financial statements easier to understand by creating an abbreviated version with a synopsis that quickly communicates your overall financial situation. Whenever possible, use simple graphs, diagrams and other visual aids to highlight specific points.

Describe Your Work with Words and Images

A “Description” is the other major section in a typical nonprofit annual report. This is where you can — and should — get creative. Explain your organization’s mission, goals and strategies for reaching those goals. Then, describe who benefits from your organization’s services and how your services contribute to the community.

To do justice to this work, include client testimonials where those you’ve helped tell the story in a personal way. Or create a timeline that enables readers to see the progress you’ve made toward a long-term goal such as establishing an endowment or constructing a new facility. Your annual report should be as visually pleasing as it is interesting to read. Include engaging photos, arresting graphics and creative layouts.

Reward Your Audience for Reading

The audience for your annual report may be larger than you think. Ensure it offers something to grab the attention of donors and other supporters, clients, community members, charity watchdog groups and the media. Otherwise, you could be wasting an important opportunity.

© 2022

 

You might also like

Help Donors Help Your Nonprofit with a Planned Gift

Help Donors Help Your Nonprofit with a Planned Gift

Most established nonprofits are already equipped to solicit and accept planned gifts. But if your nonprofit is new to planned giving and doesn’t yet understand the long-term advantages of deferred gifts, it’s a good time to get up to speed. You’ll likely need to...

read more
Want to Boost Income? Consider a For-Profit Subsidiary

Want to Boost Income? Consider a For-Profit Subsidiary

Just because you run a nonprofit organization doesn’t mean you can function on low or no income. Although your nonprofit’s tax-exempt status prohibits certain money-making activities, you may be able to create a for-profit subsidiary that isn’t hampered by such...

read more
Don’t Let IRS Compliance Issues Drag Down Your Nonprofit

Don’t Let IRS Compliance Issues Drag Down Your Nonprofit

In recent years, the IRS has increased its scrutiny of tax-exempt organizations. Most nonprofits that fail to file Form 990 for three consecutive years will have their exempt status revoked automatically. The IRS is also cracking down on nonprofits that don’t properly...

read more