Key Item Trend Statements - KITS  0045-01  ZZall

                              - - - Rejoice in the Lord always ... again I say Rejoice !!! - - -


                               TO:  Interested Ministries                                                                                                   FROM: Jim Bramer, Retired Auditor-CPA
                                                                                                                                                                                 FILE:  0045-01/all

                                RE:  Key Item Trend Statements (KITS)                                                                       Originated:  September 1982                      


BACKGROUND

    Perhaps some of you Ministry Board Members will identify with this!
    At the recent Board meeting, the Ministry Treasurer presents the financial report on multiple sheets of paper (sometimes on both sides of the page). You then digest it and try to understand its contents; sometimes you don't ask questions because you don't want to appear as a "dummy". Suffice it to say, you really do not understand the financial facts as you should.

A BETTER WAY!

    You, as a board member, really want to serve effectively and must have meaningful financial data on a timely basis to discharge this important responsibility.

KEY ITEM TREND STATEMENTS

    We recommend a one-page K)EY I)TEM T)REND S)TATEMENT, (KITS), or Executive Summary Statement, (it could be on a colored piece of paper) of some type, containing perhaps a dozen relevant pieces of condensed financial facts whereby you can follow trends during periods of time. Some of you like to use this data as 'fodder' for Charts and/or Graphs. Also please note the links below to what I call BIG PIX reporting that also serves KITS like purposes.
                        At a Church
                        At a School
                        At a Mission Agency

ESSENTIALS

    In developing your KEY ITEM TREND STATEMENT, we recommend answers to at least the following questions:

ARE WE FINANCIALLY HEALTHY?

    This question must be high profile to all of you. The applicable "decision makers" must receive timely warnings of negative financial trends; "Red Flags" are prominently displayed.

WHAT ABOUT NON-CASH ITEMS?

    You must give sufficient consideration to non-cash financial data. Example of non-cash items are: unpaid bills (ACCOUNTS PAYABLE); Unremitted withheld payroll taxes; unpaid installment payments due on mortgages and notes; amounts owed by others to you (ACCOUNTS AND NOTES RECEIVABLE); and merchandise inventory, when applicable.

HOW ARE WE IN RELATION TO SOMETHING MEANINGFUL?

    "Decision-makers" should be able to compare actuals to projections (budget) and thereby measure results of buying actions, especially,  in relation to plans. Some of you like to compare actuals to some historical information.

ANY CASH RESTRICTION?

    You must know how much cash is available to pay regular bills. You should know how much and why cash is set aside either by the Board or by Donors.  
    The paramount objective in this report is to communicate to all who should know and can do something appropriate.

WHAT DOES THE "KEY ITEM TREND STATEMENT' LOOK LIKE?

    We have assisted "decision makers" in developing their own operational  KEY ITEM TREND STATEMENTS by type of organization and there is a sample below, but this report is very personal to the individual Ministry and must answer questions at a time you need answers. Since accountants and non-accountants would not necessarily have the same need, we recommend that you consider the above essentials and tailor your KEY ITEM TREND STATEMENT to respond to your individual needs. Some of you "decision makers" need different key information at more frequent intervals than others.

- - - - X Y Z   Operations - - - - - - - -

-- KEY ITEM TREND STATEMENT -------

        I N C O M E

    E X P E N S E S

GPFund

SPFund

  Total

   Payroll

   Total

    Gain

    Period

Income

Income

Income

Expenses

Expenses

   "-"loss

01/31/XXX1

696

2,738

3,718

2,650

4,170

-452

02/28/XXX1

246

1,827

4,650

3,900

3,900

750

03/31/XXX1

196

2,985

4,362

4,412

6,049

-1,687

04/30/XXX1

229

2,017

2,508

2,103

5,301

-2,793

05/31/XXX1

286

2,542

4,077

2,584

3,688

389

06/30/XXX1

200

1,678

3,252

2,391

5,140

-1,888

07/31/XXX1

221

2,099

3,600

2,301

3,641

-41

We trust you find this "KITS" approach of benefit.


    The bulk of this Publication originated in September 1982 and was      UPTD: March 09, 2012  

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     (1) An Online Document, or WRIT (Writing), may be applicable to all Ministries, or it may be designed for just groups like: Evangelical Church, School, Missionary Agency or Organization, Christian Camp / Conference, or other named group.
      (2) WRIT formats include the perspective of   Jim@bcidot.org  via IOMs (Inter-Office Memos) to the Ministry Finance Team (MFTeam); THRDs, a hypothetical Online conversation with members of the MFTeam; GLEANINGS, or Scripture within context of the MFTeam; FWIW; A periodic editorial (For What it is Worth); TRUISM, or believed Ministry Finance principles; and via FAQ, response to Frequently Asked Questions