The current economic environment is continuing to put pressure on Not for Profit organisations and their finances
2023 marks our third annual not for profit leaders survey on financial management. Whilst we have seen changes in our external environment since 2021 (the pandemic and lockdowns), we are still seeing similar trends in the way not for profits are managing their finances from our previous year’s reports.
Not for Profit organisations are facing additional financial challenges including changes in donor behaviour, economic downturn, inflationary pressures and changes in government policy, which look to continue in 2024 and beyond.
Report Summary
- The economic environment continues to affect planned case reserve levels
- 64% have seen an increase in revenue in the last two years and 45% are budgeting a surplus over the next 12 months
- Only 25% of respondent’s constitutions allow directors to be remunerated
- 47% of organisations have automated their finance processes
- 13% have included AI or automation in their strategic plans
- HLB Mann Judd Sydney surveyed members of the Exclusive Not for Profit Community and other not profit leaders on financial management.
The outlook
The current economic factors will only add further pressure to the Not for Profit sector – with cost of living pressures pushing individuals to rely on charities for support and the potential for a loss in revenue for charities.
The one thing that hasn’t changed however, is the importance of managing how the organisation's resources were used. With economic uncertainty around, astute financial management is crucial for organisations to weather the storm.
"By using technology to work smarter rather than harder, Not for Profit leaders can plan wisely for current and future needs to protect both their brand and their finances."
Head of Not for Profit, HLB Mann Judd
Key findings
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About the Not For Profit Leader's Report
The Not For Profit Leaders Report is a semi-annual publication produced by HLB Mann Judd Sydney. It involves surveying leaders in the not for profit (NFP) community, focusing on key aspects of strategic planning in March, with findings shared in May. Similarly, in October, NFPs are surveyed again on financial management, with the corresponding report released in November.
Survey respondents include traditional charities, social enterprise and membership organisations ranging from small to large.
Members of the Exclusive Not For Profit (ENFP) Community gain first access to both the surveys and reports.
About HLB Mann Judd Sydney
Mann Judd in Sydney was formed in 1970 and over the past five decades has grown to 31 partners and directors. Today the firm provides a comprehensive range of advisory and financial services.
The Sydney firm is part of the HLB Mann Judd Australasian Association. HLB Mann Judd is an association of leading award-winning advisory and chartered firms. HLB Mann Judd has offices in most of the major business centres in Australia, New Zealand and Fiji. HLB Mann Judd is a member of HLB International, the global advisory and accounting network.