With backgrounds with business and finance, many foundation board members are already be accustomed to producing or reviewing financial statements. However that knowledge doesn't always transfer exactly. Institutionally related foundation financial statements will look somewhat familiar to those who are comfortable with for-profit financials, with a few important differences in format and terminology. The most visible difference is the names of the financial statements and the resources they list. Oversight for the annual audit and related financial reporting is one of the most important fiduciary responsibilities of a nonprofit board member. Not only does the annual audit provide assurance that numbers are accurate, it provides a forum for volunteer leaders to obtain an outside assessment of financial staff and the financial controls in place.
For more on the important and nuanced world of foundation finance, consider AGB Press's newest publication: Understanding Foundation Finances: Financial Oversight and Planning for Foundation Boards.