The purpose of annual reporting is to provide relevant information on the operations and activities of an organisation to key stakeholders to make informed decisions. However, if you are involved in the not-for-profit sector, you’ll be acutely aware of the shortcomings of traditional annual reporting.
Traditionally, annual reporting for not-for-profit organisations has focused on financial information:
- How much revenue an entity generated. - Whether a profit was made. - Levels of cash and working capital.
While these measures are useful and important to understand the financial health of an organisation, they don’t tell the full story of not-for-profit organisations.