Financial Management in NGO is undertaken by its governing body, board members and finance staff.
Governing Body: The body comprises of members from different committees of the organization such as finance, public relations and project. Being the ultimate authority in any Non-Governmental Organization, the governing body plays a lead role in financial department. According to the nature and state of the concern, it is also known as Council or Board of Trustees or Board of Directors or Governing/Executive Board.
Board of Members: The governing body’s plans and policies give a proper direction to the board members. In an NGO, board members are at times volunteers (non-salary people) who are ultimately responsible for the financial aspects of the organization. Although they might not control accounting methods or prepare financial reports by themselves, however they must ensure that everything is undertaken in proper order. They cannot refrain from their duties, during their association with the NGO and can only do so by resigning from the government body. The board comprise of honorary officers, who are appointed or elected to certain positions on the board. The main responsibility is to supervise implementations of all board decisions and sign legal undertakings. It will be advisable to take individuals who have experience in Financial Management such as Ex-Bankers, Accountants, Finance Managers among others on board.
Financial Manager: The finance manager is the head of the finance committee in an NGO. Apart from supervisory functions and monitoring responsibilities, the finance manager exercises the following duties:
- Ensuring that all transactions are properly accounted for and the financial systems are maintained, under all procedures and controls.
- Managing bank accounts and overseeing money transfers between head-offices, country offices and field offices.
- Signing cheques, authorizing payrolls and other payments.
- Assisting and guiding the board by providing relevant financial information during budgeting, accounts to donors and other decision-making activities. The manager does so, as and when requested.
Financial Assistant: The finance manager is guided and assisted by the financial assistant. The main responsibility is to report to the manager and implement work, as and when directed. The assistant role should be preparing books of account, preparing cash memos, cheques and bills. He is the in putter for the transactions for the finance manager and first level of financial control and management.
Admin Manager: Where finance manager and assistant have specific duties, the admin manager has three-fold responsibilities: Finance aspects, HR and administration and logistics. The Admin has to take overview and control of the hiring, inventories, stocks, and all other non specific activities. Since it is a senior position it is advisable to have an experienced person on the job.
Admin/Cash Assistant: The admin manager is assisted by the admin/cash assistant. The cash assistant to admin manager is similar to that of finance assistant to finance manager, only that the functionalities are different. The job of finance assistants majorly surrounds around financial resources, aspects and matters, whereas the job of admin assistant spreads across various spectrum of duties, finance being one.
In large NGOs, all the above posts are exercised by different persons. In small and medium NGOs, the financial managers and assistants take the overall responsibility. In this case, the role of finance manager also includes that of admin manager. In a similar manner, the job of financial assistant also includes that of admin assistant. Irrespective of its size, there is a governing body and board across all NGOs.
Conclusion: To sum up, financial management is one of the most significant functions of any organization, including NGOs. Financial control is at the heart of financial management. A well planned and competent financial control ensures proper use of money, financially protected members and safe assets. Financial decisions also effect on overall management and activities of NGOs. With proficient and tactical finance strategies with changing time and circumstances, Non-Governmental Organizations can successfully manage their financial resources and ensure steady growth and development within the concern. With sound financial planning, organizing, coordinating, executing and finally reviewing; these organizations can skyrocket their funds and achieve its objectives in the near future.