Accuracy of Financial Classification and its Impact on Supporting Civil Associations
A reading into the impact of financial classification on supporting associations
By: Alaa Abu Anas
In many civil associations, the problem does not lie in weak programs or lack of achievements, but in how they are presented in the financial statements.
Inaccurate classification of expenses, or not clearly showing program and activity expenses, can directly affect the association's evaluation and its chances of receiving support.
When reviewing financial statements, it is important to ensure that all expenses related to programs and activities are included, including expenses allocated to the activity, services and benefits, and related volunteer work, within the program and activity expenses in a clear and accurate manner.
Even when separating some items accounting-wise, it remains important to show a final total that reflects the true extent of what the association spends on its programs and initiatives.
Financial classification accuracy is not just an accounting procedure, but an influential element in the association's image and the confidence of supporting entities, and it may be a reason for enhancing support opportunities or affecting them.