Every Nonprofit Needs One, But What’s Really Needed in Your Nonprofit’s Annual Report?
So, you’re one year into the adventure of starting your own nonprofit and now the time has come to put together your first annual report. Or, perhaps you’ve just been tasked with putting together the annual report for your organization for the first time. No matter what position you’re in, you likely have some questions about what you need to include in this important piece of collateral.
What is an annual report?
An annual report is an important public document that nonprofits publish each year to communicate with their community and donors. The annual report includes things like your organization’s major accomplishments, benchmarks, and constituent success stories.
This report should tell your donors how you used the funds they donated this year to further your mission and what your nonprofit is planning to do next.
What information should you include in your annual report?
Your annual report should include lots of tangible examples of how you’ve worked to meet your goals and serve your constituents. Here are a few things to consider when creating your report.
Create a cover.
Choose some of your best photos and select a title and core theme that will help you review the year from one specific lens of focus. Each report should be distilled into a few core highlights of that particular year.
Share your mission.
Your mission statement should be clearly presented in your annual report. After sharing the mission statement, vision statement, and core values, your annual report should then show how your organization executed those through data and story.
Share key indicators.
It’s important to be transparent with the community and donors about your financials to build trust. Include a financial narrative and summary in your report. Generally speaking, you’ll want to share Revenue, Gains, Support, Expenses, and Net Assets. Consult your auditor or accountant if you have questions about what categories and numbers to include.
Tip: Wondering what others are doing with their nonprofit annual reports? Because these are public documents, you should be able to find them on other nonprofit websites if you go looking for examples!
For example, here are links to International Justice Mission’s 2020 annual report, To Write Love on Her Arms’ 2018 annual report, charity: water’s 2019 annual report, and She’s the First’s 2019 annual report.
Share your fundraising results.
In this section, highlight your major fundraising events and share the grants awarded to your organization, as well as who gave them to you and what you used them for. If you have a particularly successful campaign to highlight or a designated “inner-circle” for donors, include a synopsis of those fundraising initiatives as well.
Highlight your supporters.
While sharing the organization’s accomplishments is important, remember to give supporters their due as well. Making the donor the “hero” will always be well received by the public as it will validate the current donors and encourage future donors to give.
Compile a list of all of the donors and the various donation levels your supporters have given at in the past year. Most donor management systems will have a basic export function that can make this part of the annual report fairly simple.
Highlight your staff.
Make a list of your board officers, members, and staff for the year. This is a great way to highlight some of their work and show how much you appreciate them.
Bonus: If you want your report to go the extra mile, think of how you can include a moving story or two within it. This helps the report to be less dry and more relatable.
Story is the difference between creating a document that is just a report and creating one that is a true marketing tool. So, select an individual involved with your organization and share their transformation. These individuals can be beneficiaries, volunteers, donors, staff, or board members. Think of your organization holistically and try to capture one or two of your most inspiring stories and add them to your report with a few photos.
After you’ve created your annual report, you need to decide where and how to share it. Traditionally, reports are published on a designated page on your website, but beyond that it’s up to you.
Consider posting about the release of your report on your social media accounts and sending out a PDF of the report via email to your subscribers. If you have the budget, you can also mail hard copies to top supporters or grantors.
Good luck creating your report!
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