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From Passion to Execution: How to Start and Grow an Effective Nonprofit Organization > Chapter 12 Nonprofit Accounting > Budgets - Pg. : Safari Books OnlineTable of ContentsDownload Safari Books Online apps: Apple iOS | Android | BlackBerryEntire SiteEntire SiteTitles OnlyShort CutsRough CutsAdvanced SearchAdvanced SearchHelpHelpSupport HomeAlertsTop Knowledge ItemsFrequently Asked QuestionsAccount ManagementBillingContentContent ReaderMobileOffline ReadingSign InReactivateSign UpFree TrialSafari Books Online is a digital library providing on-demand subscription access to thousands of learning resources.This BookFrom Passion to Execution: How to Start and Grow an Effective Nonprofit OrganizationSearchsearch inThis BookThis Chaptersearch forContentsTable of ContentsTitle PageCopyright PageDedicationAcknowledgmentsAbout the AuthorContributorsContentsIntroductionPart 1 Catch the VisionPart 2 Building the FoundationPart 3 Getting and Staying LegalChapter 8 Applying for IncorporationChapter 9 The Ins and Outs of 501(c)(3) StatusChapter 10 Dealing with Insurance and LiabilitiesChapter 11 Hiring: Finding the Right Talent for the JobChapter 12 Nonprofit AccountingResponsibilitiesGeneral PoliciesBudgetsBoard ApprovalVariances, Remedies, and ContingenciesChoosing Accounting SoftwareAccounting Policies and ProceduresGrant Proposals and ReportsFinancialsOMB CircularsAudit (It’s Just a Five-Letter Word)Other AuditsSarbanes-Oxley ActIRS Form 990Bottom LineChapter 13 An Overview of Report TypesPart 4 Putting Your Ideas to WorkPart 5 Funding Your WorkPart 6 Communication: Telling Your StoryAppendix Filing InformationIndexCreate BookmarkCreate BookmarkCreate Note or TagCreate Note or TagPrintPrintHtml View (Key: h)Zoom Out (Key: -)Zoom OutZoom In (Key: +)Zoom InToggle to Full Screen (Key: f)Previous (Key: p)PreviousNext (Key: n)Next Chapter 12 Nonprofit Accounting > BudgetsBudgets
When you prepared your Form 1023 application, you drafted pro forma (forecast) budgets for your organization for the first three years. Keep in mind that a budget is your best estimate of the income and expenses you anticipate within the budget period. On a monthly basis, you or your accounting manager should prepare financials comparing the actual results to the projected budget for that month or period.
Incorporate your programs and plans into your annual budget. Since you will not have a history on which to base your assumptions, you may want to rely on your trusted advisors to share information from similar events. This is another area where I like to be conservative by “under promising,” which will allow you to “over deliver” when you exceed the original revenue goals.