A new cross-course collaborative experience for business students at the University of Nebraska–Lincoln extends the hands-on learning of the Leading People and Projects course project known as Strive to Thrive Lincoln to graduate students in Nonprofit Financial Management. Through a joint effort, students in both courses make a positive impact on the nonprofit Lincoln community through a direct approach to the grant selection process.
“The partnership with FINA 871 enhances the Strive to Thrive Lincoln project, and I remain grateful to get to work with Jim Croft and his students. It’s uncommon for undergraduate and graduate classes to collaborate, but when there are two College of Business classes who, despite being at different educational levels, are both focused on learning about and strengthening the nonprofit sector, it would be a shame not to take advantage of this unique opportunity,” said Amber Messersmith, lecturer of management, who teaches MNGT 411.
During MNGT 411, students spend the semester learning about the grant selection process, as well as relevant issues and existing needs within the community, ultimately leading to awarding $10,000 in grants to two local nonprofits of their choice. Once MNGT 411 students review local nonprofits and compile a shortlist of 12, FINA 871 students step in to do financial reporting and analyses on the organizations.
“Nonprofit organizations’ primary financial purpose is to ensure the organization has the financial strength to carry out its mission, which often entails service and program delivery. In this project, FINA 871 students are asked to perform a series of financial analyses to assess an organization’s financial health and its operating efficiency,” said Jim Croft, principal with JW Croft Consulting Group in Chicago, who leads FINA 871.
Working with the IRS Form 990, FINA 871 students calculate ratios that analyze a nonprofit’s ability to meet current and future financial requirements, as well as ratios to assess how efficient the organization is in using its resources to carry out its mission. Graduate students, like Bailee Steinle, then generate reports from their analyses to share with MNGT 411 students and aid their decision-making.
“Within Form 990, you can find high-level information like total revenues and expenses, in addition to detailed breakdowns like revenue from membership dues and expenses related specifically. Within the reports, we broke down key ratios, compared the nonprofit’s financial adequacy and efficiency to that of other nonprofits with a similar size and mission, and provided a final assessment of the nonprofit’s financial health,” said Steinle, a Master of Professional Accountancy student at Nebraska.
Jonathan Logan, a senior accounting major from Lincoln, explained how instrumental financial reporting is to the class’s decision in their grant awarding process.
“The financial analysis gave us the professional context we needed to understand how the nonprofits we were considering lined up with industry standards. Using these comparisons, we were assured the final options we selected from could continue operations and weren’t facing any serious financial threat,” Logan said. “If we had not received these analyses, we wouldn’t have been so sure the final selection was capable of converting our two grants into the value that they promised to make.”
Messersmith shared how the graduate student input enhanced the undergraduate learning experience, while improving the decision-making process of the class.
“The graduate students’ financial expertise aided our decision-making immensely. The information shared by FINA 871 elevated both our due diligence and the level of class discussions. I believe the class made more thoughtful decisions due to the analyses,” she said.
As a former Strive to Thrive Lincoln student, Steinle experienced how participating in this cross-course collaboration now as a graduate student proved beneficial to her future professional career. After her experience in both courses, she gravitates toward future involvement in the nonprofit sector.
“As I head into a career in public accounting, I will undoubtedly come across a nonprofit or two, and having the background knowledge afforded to me by these two courses will be indescribably helpful. Both MNGT 411 and FINA 871 allowed me to see the importance of finance and accounting to nonprofit organizations, but it’s not uncommon for these organizations to lack individuals with such expertise. Through this collaboration, I was able to get a better understanding of what things grant-makers might be looking for from a financial perspective, which I think will allow me to provide better guidance to a nonprofit in the future,” she said.
Messersmith believes both student groups gain something positive from the experience.
“It is unique for undergraduate students to see assignments prepared by graduate students. Should undergraduates choose to pursue graduate degrees one day, they have seen the academic rigor required by MBA classes. I also hope graduate students found working on a project with real implications to be rewarding. Their analyses and guidance were not prepared for a hypothetical case study but rather for a group of 44 undergraduates making grant decisions that will affect the lives of our Lincoln neighbors,” she said.