A not for profit income statement template is a financial statement that summarizes the revenues and expenses of a not for profit organization over a period of time, typically a year. It is used to assess the financial health of the organization and to make decisions about how to allocate resources. The income statement is one of the three main financial statements, along with the balance sheet and the statement of cash flows.
Not for profit organizations are different from for profit organizations in that they do not have owners who receive profits. Instead, they are owned by their members or by the public. This means that the income statement is used to show how the organization is using its resources to achieve its mission.
The income statement is divided into two main sections: the operating section and the non-operating section. The operating section includes revenues and expenses from the organization’s core activities, such as program services, fundraising, and membership dues. The non-operating section includes revenues and expenses from other sources, such as investments and grants.
Revenue
The revenue section of the income statement shows the organization’s total revenue from all sources. This includes revenue from program services, fundraising, membership dues, and other sources. Program services are the core activities of the organization, such as providing educational programs, social services, or healthcare. Fundraising revenue is generated through activities such as direct mail campaigns, special events, and online giving. Membership dues are paid by members of the organization to support its work.
Other revenue sources may include investment income, grants, and donations. Investment income is earned on the organization’s investments, such as stocks and bonds. Grants are awarded to the organization by foundations and government agencies to support specific programs or projects. Donations are gifts of money or property that are given to the organization to support its work.
Expenses
The expenses section of the income statement shows the organization’s total expenses from all sources. This includes expenses from program services, fundraising, administration, and other sources. Program services expenses are the costs of providing the organization’s core activities, such as salaries, supplies, and rent. Fundraising expenses are the costs of raising funds, such as marketing, advertising, and event planning.
Administration expenses are the costs of running the organization, such as salaries, rent, and utilities. Other expenses may include depreciation and amortization, which are non-cash expenses that represent the decline in value of the organization’s assets over time.
Conclusion
The not for profit income statement template is an important financial statement that can be used to assess the financial health of an organization. It can also be used to make decisions about how to allocate resources. The income statement is one of the three main financial statements, along with the balance sheet and the statement of cash flows.
Not for profit organizations should use the income statement to track their financial performance and make informed decisions about how to use their resources. By understanding the income statement, not for profit organizations can improve their financial health and achieve their mission.
