Everything you need to know about creating an annual report that will help your nonprofit's mission advance.
At the end of every year it is time to look back at your organization's activity and share with your nonprofit's board of directors, major givers, partners, volunteers, and other supporters just how much your organization has changed and grown over the past year. This is what annual reports are for.
While Annual reports tend to have a bad reputation as they are not the most fun to make, they do actually have significant importance to your future fundraising efforts, and it is recommended to take the time and put together a well prepared annual report for your nonprofit.
Why Should You Create an Annual Report for Your Nonprofit?
Your nonprofit is using other people's money to run its activities. It is those people's right to know how the money is being used and what it gained. And since we are living a data era, your supporters will be expecting to get some numbers before choosing to support you again.
Accountability may have an intimidating effect, but you should look at it as an opportunity. Annual reports are a great way of showing your results, proving your organization’s transparency, gaining your supporters trust and swaying them to become recurring supporters for your nonprofit.
How Should a Nonprofit's Annual Report Look Like?
There is no one way an annual report should look like. Annual reports can be printed as physical paper reports and sent by direct mail, or they can be virtual updates shared using email, or even via a Zoom call.
To make the report more interesting and compelling you should use photos, infographics, videos and preferably a graphic designer to help you put everything together in an aesthetic way. Even if you don’t have the resources for a professional graphic designer, there are affordable and free online design software for nonprofits you can take advantage of, or perhaps you can use the help of one of your volunteers.
6 Elements Your Nonprofit's Annual Report Should Contain
As a nonprofit you should use your annual reports to share your successes from the past year, thank your supporters, allow a closer intimate look into your organization and the impact you’re making, and remind your donors why your cause is worthy of their further support.
We recommend using the following structure for your nonprofit's annual report:
1. Your Mission
Your nonprofit's mission should be the first thing on the top of the report.
Tell your goals in a short and clear way that will remind your readers what you're all about.
2. Activities & Projects From the Past Year
Showcase your great accomplishments proudly. What projects took place, what were your goals for the year, and what have you achieved.
Be truthful regarding everything and don't hide places where you were less successful. Take the time to reflect what happened that prevented you from reaching some of your goal, and perhaps your supporters will appreciate your sincerity and even choose to help you reach your goals the second time around.
Show your supporters that your nonprofit is responsible for its funding. Explain to your donors exactly how their donations are being used.
4. Impact Data
After sharing your project, and explaining your expenses, this is the time to show your impact. Create a nice infographic summarizing the impact of your work using data and numbers.
In this example you can see (a) How the money was spent (b) what is the benefits from the money used (c) that this was a good investment financially. By presenting the data as an infographic, you can highlight what you want your readers to focus on. The design makes it easier to understand, friendlier to people who don't love numbers and by using images from your activities it also makes it more relatable.
5. Appreciation for Your Contributors
Your nonprofit yearly report is yet another opportunity to thank those making it all possible - your supporters. Show them the appreciation they deserve and remind them that they are the reason you’ve been able to accomplish so much in the last year. Highlight top donors, volunteers and partnerships that were extra significant in their contribution.
6. Plans for the Future
Wrap up the report with exciting information regarding what’s in store for your nonprofit and your future plans. Encourage your supporters to dream with you and invest further in your mission.
# Bonus Tip:
After you’ve updated your supporters about your future plans, make sure to also provide them the opportunity to participate. List some ways that supporters can take part in right away such as meeting dates, upcoming events and of course the URL to your donation page.
Creating a yearly report may seem like a grey dull task, but if you use it correctly you can leverage it to work in favor of your nonprofit's strategy and goals.
Remember you are not alone! Join GivingWay’s community of nonprofit organizations to share your insights and questions with organizations similar to yours.