Money is essential to every organisation. All organisations or businesses have to look after their money carefully. That means using good financial management.
Here is a simple ‘health check’ on basic financial systems and budgeting. This check will tell you if your basic systems are healthy or sick – and whether you need to call a doctor!
The checklist consists of a series of 15 simple statements. In a group, discuss each statement, decide which of the following responses is appropriate and circle your score.
- Always true (score 5)
True 100% of the time
- Mostly true (score 4)
True more than 80% of the time
- Sometimes true (score 1)
True between 20% and 80% of the time
- Seldom or never true (score 0)
True less than 20% of the time
Interpreting your score
Add up your total score and compare it with the following risk categories.
Low risk (score 60–75) Well done! Your basic systems and budgets are in good shape. But, you cannot afford to relax. You should aim for a score of 75 points! Other areas of financial management may also need attention, such as reporting and staff training.
Medium risk (score 45–59) Your basic systems and budgeting are not too bad – but not too good, either. There is a medium level of risk that financial problems will prevent you carrying out your work. This is a cause for concern.
High risk (score 0–44) You have serious problems. Your basic systems and budgeting are not in good health. There is a high risk that you will face financial problems in the near future. You should consider calling in assistance as soon as possible. This must be done right now.