Nonprofit Annual Reports

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Annual reports can be used to highlight a nonprofit’s mission and impact, thank volunteers and supporters, and make a case for donating to the organization. What makes a nonprofit annual report compelling?

Today, more and more nonprofits are going paperless with their annual reports. Should your organization do the same? And here's an idea: the Living Annual Report, updated weekly by the Tableau Foundation.

For Starters

Here are two questions to help focus your annual report:

  • Who is your audience?
  • What do you need to accomplish?

Your annual report will probably be geared towards individual donors, foundations, and perhaps other audiences, so consider the best ways to reach each of them. The contents of your annual report should be visually compelling, underscore your nonprofit’s commitment to transparency, and explain your organization’s mission, progress, and outcomes.  Annual reports usually document what your nonprofit has accomplished in the past year, but consider including a vision of what lies ahead. Most annual reports feature photos and financial reports (illustrating the nonprofit’s revenue and expenses), and acknowledge contributors. Annual reports are an opportunity to be candid and transparent about your nonprofit’s finances and outcomes, and build trust with your audience.

Paper vs. Paperless

When you are thinking about ways to increase efficiencies, whether reducing cost, reaching a wider audience, or attracting more attention, think about whether going paperless is the right choice for your nonprofit. Many organizations have cut back on paper copies or supplement their print material with online resources. Others opt for a completely paper-free path, releasing their annual report as an infographic, a video, or even a conference call.

Also consider including:

  • Interviews and transcripts
  • Podcasts
  • Photo galleries
  • PDFs (with links embedded)
  • Screen shots or links to presentations (Prezi, PowerPoint, e-zines)
  • Here's an example of a video annual report! (Kentucky Nonprofit Network)

Practice Pointers

  • Be honest and acknowledge both the highs and the lows
  • Direct quotes and first person narratives draw the reader’s attention
  • Keep it short, simple, and easy-to-read
  • Technology doesn’t always save money or time. Employees need to learn the software and spend time developing the product, which may take just as long as creating print materials.
  • Paper copies have their advantages: they can still find their way to influence donors. (Even famous investor Warren Buffett has been influenced by annual reports!)
  • Consider providing paper copies upon request or distributing smaller, more condensed versions of your full annual report. Even a postcard could find its way to the right audience.

Above all, remember that nonprofits are required to disclose certain information when requested by the public.  Annual reports are not usually the place to disclose that required information, but are another tool to help build donor trust, which is important to maintain, and easy to lose.

You won’t always have a donor’s ear at just the right moment, so let your nonprofit’s annual report do some of the talking for you!

Tools

Sample State Association Annual Reports

More Resources

For fun: here's an annual report about an individual’s life!

Category: 
Ethics & Accountability
Tags: 
Annual Reports
Impact
Transparency
Financial Report
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