How to read a charity annual report
An annual report is a charity’s chance to show the year it just finished. Some reports are full of photographs and short on numbers. Others bury the useful pages after a letter from the board. You can read one in a few minutes if you know which pages matter.
Read these pages first
- The financial summary. Find revenue, program expenses, management, and fundraising for the same year.
- The program results. Look for counts, locations, and a comparison with the goal the charity set.
- The leadership list. You should be able to see who is accountable.
- The notes on what changed. A merger, a new city, or a drop in revenue belongs in the open.
Stories about one person can be true and still not tell you whether the program works. Treat them as illustrations. The numbers tell you the scale.
Questions the report should answer
Could someone who has never heard of this charity explain the mission after two pages? Does the spending match that mission? Is there a goal for next year that you could check later? If the report cannot answer those questions, go to the Form 990 or ask the charity for the missing page.
Bring the charity selection checklist with you. It is easier to compare two reports when you are filling in the same blanks for both.