Great news! You just got off the phone with your contact at a foundation and they have committed to funding you for the 3rd year in a row!

But, it came with an understanding that your organization would increase the number of students served in the tutoring program for the next fiscal year.
Surprise! Wait, what? Do they want us to scale up the program?

I feel your pain. Undoubtedly from time to time, there will be unexpected events or challenges that test your agility and ability to rise up and overcome them. There’s always a way out as long as you have the courage and commitment to seek it!

So, how do you get started? It begins with financial clarity.

What is Financial Clarity?  

Boiled down to its core, it means that financially you know where you’ve been, where you stand right now, and where you are going in the future to be successful in achieving your mission.  

To achieve financial clarity, here are three foundational steps to start the process:

  1. Clear Outcomes and Inquisitive Questions – What are you trying to accomplish? What do you need to do to get there?
  2. Budgeting and Forecasting – What is  your current financial picture? What do your overall financial projections look like for the next 2-3 years?
  3. A Financial Tracking Tool – How do you capture all financial transactions for reporting and analysis?  Where can you go to make sound, real-time financial decisions?

Now, let’s apply the process to our example above!  

Clear Outcomes and Inquisitive Questions

To start with, clearly picture what kind of outcomes you’d like to see. The gap between your current situation and the outcome you want is the space where you’re going to ask a lot of questions.

For example, you might want to expand the number of students in your tutoring program by 25%. If you can do that, you can eliminate your student waiting list.

In scaling up the tutoring program, think about questions such as:

  • What increased costs may come with it?
  • Do you need to rent a larger space to accommodate more students?
  • Does that mean increased monthly rent?
  • How about utilities, staffing and program supplies?

To help you anticipate costs, revisit program costs from previous years. Now think about the funding allocated to this tutoring program. Is it still enough to cover the scaled up version?  

If this sounds too overwhelming to tackle, we recommend a story mapping exercise to help you dig in further and visualize the potential moving pieces that will make your outcome a reality.

Budgeting and Forecasting

Budgeting helps you lay out expectations for revenue and expense targets that you want to achieve for the year. Ideally, budgeting is completed and reviewed before each new fiscal year starts and can help you be more accurate in financial decision making when you plan it out month by month.

Can I revise the budget during the fiscal year? Absolutely! I call it forecasting. Forecasting helps you estimate what you will receive and spend for the year. As unexpected events come your way and affect future financials, you will adjust your forecasting numbers. When you’re done, then you will be able to see the financial gap (or surplus!). And, it will give you a chance to be proactive in responding to this new revelation, such as reigning in costs, actively securing more funds, or pursuing other strategies.  

A Financial Tracking Tool to Capture Your Transactions

Being busy and all, you’ll want to capture your financial activities in an efficient manner. A reliable accounting software can help simplify your bookkeeping process, by helping you categorize revenues and expenses by fund or program. It can also help you run reports easily with minimal customization to fit your specific needs.

There are many accounting software solutions out there that can help you streamline processes and capture data accurately, including Quickbooks Online and  NetSuite Social Impact among others. I’ll cover the pros and cons of a few solutions in a future article, be on the lookout for it!

Until then, please reach out to me if you have questions, or if you are eager to jump-start your journey into financial clarity. You can reach me at