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Demystifying Expenses to Determine True Program Costs

April 20 @ 1:00 pm - 2:00 pm

Demystifying Expenses to Determine True Program Costs w/ Steve Zimmerman of Spectrum Nonprofit Services

Making financial decisions, whether to cut back a program or to bolster revenue streams, depends on a clear understanding of true program costs. To calculate these, we explain how to classify and allocate costs, defining for participants the differences between direct and shared expenses – a challenging subject for even the most experienced nonprofit professional. Using a case study approach, we’ll walk participants through a cost allocation process to demonstrate the full costs for each program, allowing nonprofit leaders to more effectively advocate and fundraise for their programs.

Session Objectives• Differentiate among program, shared, and supporting costs (direct, common, and administrative expenses).• Split shared costs and allocate administrative costs in a justifiable manner to each program.• Allocate revenue to determine the profitability of each program.• Explain implications of these calculations and consider action steps to take.