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Financial Reporting for Boards: What Good Looks Like

Learn what nonprofit boards need from your financial reports. See what good reporting looks like and how to deliver clear, timely, decision-ready financial packages.
Financial Reporting for Boards: What Good Looks Like
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When board members don’t understand your financials, they can’t govern effectively. Confusing, inconsistent, or delayed reporting creates tension, erodes trust, and slows down decision-making. And when board meetings start with “we didn’t get the report in time,” the conversation is already off track.

The fix isn’t just better templates or more detailed spreadsheets. It’s a financial reporting process built around clarity, relevance, and board-level decision-making.

This guide walks you through what great financial reporting looks like in a nonprofit board setting. It’s built for Executive Directors, finance staff, and volunteer treasurers who want to improve board engagement and get everyone on the same page.

What Makes Board-Level Financial Reporting Different?

The biggest mistake nonprofits make? Sending their board the same reports they use for internal operations.

Here’s how they differ:

Operational ReportingBoard-Level Reporting
Tracks line-by-line expenses and invoicesFocuses on trends, variances, and risks
Prioritizes detail and reconciliationPrioritizes clarity and strategic oversight
Used by bookkeepers and controllersUsed by board members and executive leadership

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Here’s What Great Board-Level Financial Reporting Actually Looks Like

Notice above that board reporting isn’t about granular accounting. It’s about helping non-financial people see the big picture and make good decisions.

A strong board-level reporting process should:

  • Provide a clear view of financial health without overwhelming a board member
  • Highlight trends, risks, and opportunities in plain language
  • Align with the organization’s strategy and board responsibilities
  • Prompt the right questions from the board

Whether you’re building your board package from scratch or cleaning up a messy process, these eight best practices will help you deliver reports that are timely, strategic, and useful without overwhelming your board or your team.

1. Deliver Financial Reports on a Reliable Cadence

The board needs to receive and review financials in advance of meetings, not during them.

Best Practice:

  • Monthly reporting to the Executive Committee or Finance Committee
  • Full board package delivered at least 5 business days before meetings
  • Standing agenda item to review key takeaways and variances

Red Flags:

  • Reports are only reviewedinconsistently
  • Financial statements are shared during the meeting for the first time
  • No advance narrative or summary is provided

2. Include the Right Financial Statements (But Not Too Many)

Your board package should include three core statements:

  • Income Statement (Statement of Operations): Actuals vs. budget, year-to-date and by program or department
  • Balance Sheet (Statement of Financial Position): Assets, liabilities, and net assets as of the reporting date
  • Cash Flow Snapshot: Operating cash on hand, upcoming major inflows or outflows, and restricted vs. unrestricted cash

Supplementary reports may include grant tracking, funder reports, or capital campaign summaries, but only if the board needs them to do their job.  A board of finance committee may also decide that a group of supplementary reports providing the right level of detail may be preferred. 

3. Focus on Budget vs. Actuals With Smart Variance Analysis

The board doesn’t need to see every line item. What they need is clarity on where the organization is off track, and why.

Best Practice:

  • Highlight significant variances (e.g. 10% or $5,000+). Each board and organization will have a different threshold for what they agree is significant.
  • Explain variances in a narrative summary (not just in Excel notes)
  • Flag ongoing concerns or one-time issues

Red Flags:

  • Variance explanations are missing, vague, or full of jargon
  • Lack of program specific information showing revenues and expenses by program
  • Reports are overly detailed and hard to interpret

4. Use a Narrative Summary to Drive the Conversation

Every good board package includes a short, plain-language memo that answers:

  • Are we on budget?
  • Are there any financial concerns?
  • Do we need to make any decisions?

This summary sets the tone for the board meeting and ensures everyone starts with the same understanding.

What to Include:

  • Current financial position
  • Key budget vs. actual highlights
  • Cash flow concerns or changes
  • Upcoming grants or funding timelines
  • Questions or decisions for the board

5. Report on Restricted Funds and Grant Tracking

Boards are responsible for ensuring restricted funds are used appropriately. They need visibility into what’s been received, spent, and still committed.

Best Practice:

  • Include a separate restricted funds summary or grant tracker
  • Show remaining balances for each major restricted fund
  • Highlight compliance obligations or reporting deadlines

Red Flags:

  • Restricted and unrestricted funds are blended together
  • No clear way to track fund usage or program-specific spending
  • Board members are unclear on how certain grants are being used

6. Make Reporting Visual, Clean, and Accessible

Well-designed reports save time and reduce confusion. Use charts, tables, and formatting to highlight what matters.

Formatting tips for your next round of reports:

  • Use clear headings, bolded totals, and color-coded variances
  • Include summary charts or dashboards for revenue, expenses, and cash
  • Avoid clutter and excessive detail
  • Ensure accessibility for all board members, including those with limited finance experience

7. Provide Context for the Numbers

Numbers alone aren’t enough. The board needs to understand the why behind the what.

Best Practice:

  • Explain how financial results connect to program performance and strategy
  • Use trend data to show how things are changing over time
  • Flag external factors (e.g. delayed grants, inflation, staffing shortages)

Red Flags:

  • Board members have to guess at implications
  • Finance reports are isolated from operational updates
  • There’s no clear link between the numbers and strategic goals

8. Assign Clear Ownership of Financial Reporting

Someone needs to own this process.

Depending on your organization’s structure, this might be the Executive Director, internal finance staff, or an outsourced controller. If you’re scrambling to get reports ready for the board meeting, it’s time to bring in help.

Fractional Controllership Support Can Help:

  • Controllers: Set up templates, automate reports, and add review processes
  • CFOs: Provide board-level financial guidance and insight

Good Financial Reporting Builds Trust

A well-informed board is a powerful asset. When your financial reporting is clear, timely, and strategic, board meetings become focused, productive, and aligned.

If your current board reporting process is falling short or costing too much internal time, Enkel can help. Our fractional finance team works with Canadian nonprofits to clean up systems, deliver monthly reports, and ensure your board gets exactly what it needs.

Need help? Talk to an Enkel Expert or explore our Fractional Controllership services.

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About Omar Visram / CEO and Head of Growth
Omar Visram is the Co-founder and Head of Growth at Enkel Backoffice Solutions Inc. Headquartered in Vancouver, Enkel provides bookkeeping, payroll, accounts payable and accounts receivable services to over 300 organizations Canada-wide.