Inside the Upside-Down World of Nonprofit Finance: Author Shows How Seven For-Profit ''Rules'' Don't Apply

Inside the Upside-Down World of Nonprofit Finance: Author Shows How Seven For-Profit ''Rules'' Don't Apply: "Press release from: Nonprofit Quarterly
Inside the Upside-Down World of Nonprofit Finance: Author Shows How Seven For-Profit ''Rules'' Don't Apply

(CSRwire) BOSTON, MA - Even as society and government agencies put greater and greater demands on nonprofits to provide needed services and fill other gaps there is little or no understanding of the way in which the nonprofit sector is hamstrung by the 'irrational' and often 'topsy-turvy' application of financial rules that are taken for granted in the for-profit sector, according to a new article in the Spring 2005 edition of the Nonprofit Quarterly.

In 'The Looking-Glass World of Nonprofit Money: Managing in For-Profits' Shadow Universe' (www.nonprofitquarterly.org/section/704.ht ml), Clara Miller, who is president and CEO of the Nonprofit Finance Fund (NFF), uses the following hypothetical illustration to show how for-profit and nonprofit financial practices operate in very different ways: '� you're the owner of a restaurant. Your paying guest comes to pay the bill, offers a credit card, and prepares to sign the charge slip. But before signing, the guest says, 'I'm going to restrict my payment to the chef's salary. He's great, and I just want to make sure I'm paying for the one thing that makes the real difference here. I don't want any of this payment to go for light, or heat, or your accounting department, or other overhead. They're just not that important. The chef is where you should be spending your money!' "