Controlling, monitoring and analysing budgets Flashcards
Distinction
Example of how you’ve monitored actual income against budgeted income
MITIGATE RISK
The corporate team have a budget and within that is the new business budget. Whilst I don’t have a personal target I use this to steer my daily actions and short to long term decisions.
Control
When it comes to setting budgets there are a few control mechanisms in place.
When I am developing pipelines, I gather and input financial insights into our SRM such as how much we want to ask / expect the partnership will raise. (I’ll elaborate further when we discuss fundraising planning). This feeds into the new business projections.
In the early stages I have to make an educated guess based on the insights I have at hand. To ensure that the new business projects are proportionate and a true reflection I weight these figures based on likeliness of winning the partnership e.g. 75% for high likelihood – 25% for low likelihood. This control mechanism helps to mitigates the risk of the budget reporting a £3m worth of opportunities when the probability is much lower.
We work to an 8-4-1 ratio – every 8 prospects, we’ll make asks of 4 and expect to win 1. So, for the Innovation Challenge I have a budget of £450k for 2024 so I’ll need to develop a pipeline upwards of £100k to be in with the chance of securing £450k.
Monitor
After setting budgets they are regularly monitored. Each month my manager and I look at the actual income against the forecast income on the team income tracker.
We either work with our partners and finance to monitor any missing income.
Or we reallocate income to other months where we aren’t tracking against targets.
e.g. it is common for new business income to be quite slow until Q4. Good practice to find creative opportunities to secure income earlier in the year e.g. last year we hooked commercial asks onto NHS75 campaign in July.
Analyse
When we reconcile budgets we also submit narrative to our senior team.
I work with my manager to reflect on the asks from previous quarter and upcoming asks. We analyse them against internal and external trends e.g. we aren’t performing well on COTY and we have a stronger strategic partnerships proposition so I’ll be shifting my focus there.
External trends help us make sense of things e.g. lack of brand awareness and household name, corporate needs for events and volunteering opportunities extra value that we can’t provide. ESG is becoming more important so there is more opportunities in the strategic space.
Justify and get support from senior management about the choices we are making to mitigate risks to our income.
Likewise with expenditure – I need to know how much things costs and ensure we get a good ROI on fundraising activities. I have cancelled a partnership because the corporate wouldn’t commit to underwriting a donation and I couldn’t’ justify the expenditure into the partnership activities without the security of a return.
All of these mechanisms help me track my fundraising performance - the monthly check-in give me the opportunities zoom out analyse performance against trends and put measures in place to mitigate any risks to achieving our annual target – and puts the ogranisation in the best position to achieve impact.
How would you go about maximising the benefit of Gift Aid
Gift aid is an amazing way is topping up your donation at no cost to the supporter. I think making it seamless in the donation journey and raising awareness of it is crucial. Higher tax bracket. Make their gift go further
