Moving Forward: 2016 Not-for-Profit Sector Outlook

While nonprofit organizations have rebounded from the most crippling effects of the 2008 economic crisis, the recenty published State of the Nonprofit Sector Survey* shows many still have significant challenges ahead.

For the seventh year in a row, a majority of the more than 5,000 organizations surveyed reported that people — particularly those in low-income communities — are going without needed services because nonprofits can’t meet the demand.

  • 76% of respondents reported an increased demand for their services.
  • 52% (versus 56% in 2014) said they couldn’t meet the demand.
  • 71% of the organizations that couldn’t meet demand said clients’ needs go unmet when they can’t provide needed services.

In addition, many nonprofits continue to be hampered by insufficient funding and a lack of investment in long-term sustainability. More than half (53%) reported three months or less of cash on hand, and many organizations listed financial concerns as top challenges.

  • 32% cited long-term sustainability as a challenge.
  • 25% had concerns about their ability to offer competitive pay and/or retain staff.
  • 19% were concerned about raising enough funding to meet all expenses.

On a more positive note, financial indicators are improving for some nonprofits. Forty-seven percent of the organizations ended 2014 with a surplus, the highest percentage since 2008.

Nonprofits are also taking positive steps to invest in their futures.

  • 51% collaborated with another organization to increase or improve services.
  • 44% hired employees for new positions.
  • 33% upgraded computer hardware or software
  • 29% engaged in long-term strategic or financial planning.
* Conducted by the Nonprofit Finance Fund

If you have any questions about your nonprofit organization’s performance and plans for the future, please contact Warady & Davis LLP at (847) 267-9600.

 

Legal Notice: The materials communicated in this transmission are for informational purposes only and not for the purpose of providing accounting, legal or investment advice. You should contact your accountant or advisor to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an accountant-client relationship between Warady & Davis and the user or browser. You should not act upon any such information without first seeking qualified professional counsel on your specific matter. Any accounting, business or tax advice contained in this communication is not a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties. If desired, Warady & Davis would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired consultation services. ©2017