The nonprofit corporation exists solely to provide programs and services that are of public benefit. Often these programs and services are not otherwise provided by local, state, or federal entities. While they are able to earn a profit, more accurately called a surplus; such earnings must be retained by the organization for its future provision of programs and services. Earnings may not benefit individuals or stake-holders. Underlying many effective nonprofit endeavors is a commitment to management. Twenty years ago, the term "management" was distasteful to many of those involved in nonprofit organizations because of its connotations of "business." Non-profits prided themselves on being free of the taint of commercialism and undue consideration of the bottom line. Now a consensus has developed within the nonprofit sector that nonprofits need management as much as for-profit enterprises. The nonprofits are, of course still dedicated to "doing good." But they also realize that good intentions are no substitute for organization and leadership, for accountability, performance, and results. Those require management and that, in turn, begins with the organization's mission.
1.1 Origin of the report:
The report prepared on “Non profit organizations: Basic overview” was a individual work given by our course instructor Mr. Golam Mohammad Forkan. It is in the course of marketing management (MKT 453) as a part of the syllabus. I have asked to submit this report by May 21, 2009.
The main objective of the report is to analyze the basic over view of a nonprofit organization, its characteristics, nature etc.
I have approached to internet, some journals newspaper etc. for information. Still some information could not be achieved which could have enhanced the report. The most important draw back of mine was time.
Basically this report is based on secondary data. I have to depend on internet, some newspapers, journals, text book. I have also followed which learned in the class about non profit organizations.
2.0 What is a "Nonprofit"?
The word "nonprofit" refers to a type of business -- one which is organized under rules that prohibit the distribution of profits to owners. "Profit" in this context is a relatively technical accounting term, related to but not identical with the notion of a surplus of revenues over expenditures. Most registered nonprofits businesses are organized into corporations or associations. Most corporations are formed under the corporation’s laws of a particular state. Every state has provisions for forming nonprofit corporations; some permit other forms, such as unincorporated associations, trusts, etc., which may operate as nonprofit businesses on slightly (but sometimes importantly) different terms. Nonprofit attribute should be (1) Serving charitable, religious, scientific or educational purposes (2) No part of the income of which "inures to the benefit of" anyone.
3.0 Key Roles of a nonprofit organization
• Clients - Everything in a nonprofit is ultimately directed to serving clients. Clients are the "consumers" or "customers" of the nonprofit's services. Note that services can be in the form of tangible or intangible products.
• Board - The board is comprised of individuals from the community and, ideally, is representative of the organizations clients. Law and theory dictate that the board is in charge, and directly accountable for the overall direction and policies of the organization. Powers are given to the board by the Articles of Incorporation (or other governing document, for example, Articles of Association, Constitution, etc.). The board can configure the nonprofit in whatever structure it prefers to meet the organization's mission and usually does so via specifications in bylaws. Members of nonprofit boards are generally motivated by a desire to serve the community and the personal satisfaction of...