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Nonprofit Accounting Software Blog
In the for-profit world, there is a return on investment, or commonly shortened to the ROI. However, in the non-profit world, you have what is called the return on mission or ROM. In many instances, that ROM is achieved or at least it helps to achieve it, by monitoring Key Performance Indicators (KPIs) on a dashboard from your business management software solutions, such as accounting software, fundraising software, and/or grant management software. All this information should be readily available in your dashboards to be able to drill down on them and view the real-time information for your non-profit organization.
Sage Intacct recently conducted a survey of nonprofit financial professionals, spanning small to large organizations with both single and multiple entities across a wide range of industries. Below is what your peers shared with us as their biggest pain points as part of the survey, as well as how to overcome them.
Below are the top 5.
Nonprofit survey respondents said the #1 biggest pain point is that reporting is manual and time consuming, which causes the following problems:
The survey also revealed that over 20% of respondents spend >40 hours per month consolidating data into Excel, and over 45% spend at least 25 hours.
Today's nonprofit world is characterized by greater competition for funding and increased scrutiny of your impact. This is sometimes due to fraud or poor performance of just a few nonprofits, which affect the whole.
Whatever the case, this represents an opportunity for your nonprofit to be transparent, to demonstrate accountability and to strengthen your reputation with funders and the community. And one way to do so is for your financials to be "audit ready" so that you can prove financial health and how you are investing funds in your mission, even if you are not audited.
How can you be audit-ready in a way that enables your nonprofit but doesn't hurt your Return on Mission? Investing in the right nonprofit accounting software is central to the answer.
Having been a Microsoft Dynamics GP partner for 30 years, we understand why some nonprofits think of GP as "Great Pains." GP was very useful for a long time but lacks cloud access, fund accounting, grant management, dimensions, and other things that can shave weeks off of monthly closings and preclude the need to add finance staff, even as transactional volumes increase.
Is it time to transition your organization's accounting software? It's challenging to navigate today's dynamic environment with technology that was designed pre-internet. With increased oversight, competition for funding, and expanding compliance requirements, your organization should be leveraging the modern technology available today. Do you find your organization struggling with lack of flexibility, real time visibility, easy reporting, and automation of key processes? Would you like to enjoy easy integration between your solutions, providing instant visibility to key metrics, outcomes and performance?
The technology revolution has made these types of functionality the norm rather than the exception. It is critical to work with an easy-to-use system that supports an evolving environment. To maximize your Return on Mission, you'll need a modern, best-in-class cloud accounting solution: Sage Intacct.
The transition to ASC 606 for nonprofits is here for some and looms on the horizon for others. Are you ready? Can your accounting software handle the new revenue recognition requirements?
For nonprofits to be fully prepared, it's important to know the following, as covered in this blog:
Nonprofits have unique needs when it comes to accounting. From fund accounting to grant administration, program management to compliance reporting – nonprofit organizations often rely heavily on software to achieve their mission. So how do you know when it’s time to select a new accounting software solution for your organization?
For most nonprofit organizations when it comes to finance, the focus has traditionally been to minimize overhead costs. Unfortunately, the area that suffers the most is investment in systems. Debits and credits used to be the only focus, but now most nonprofits have corporate cards, shifting the conversations to expense management. This becomes a barrier for nonprofits as they often have more complete reporting needs.
Intacct cloud accounting software is increasingly chosen by nonprofits to maximize their “return on mission,” including foundations, healthcare providers, associations, social services, and faith-based groups.
More specifically, Intacct does this by offering two things that save nonprofits a bundle. The first is two additional chart of accounts dimensions for the general ledger. And the second thing that helps nonprofits save is a multitude of features that maximize productivity – all of which are documented below.
There's never been more accounting software or enterprise resource planning (ERP) systems than there are today, with several claiming nonprofit expertise.
However, QuickBooks has become the most popular accounting software for nonprofits without even trying.
Why then are so many nonprofits moving away from QuickBooks?
Is it because QuickBooks lacks key functionality for nonprofits, or do users run into limitations that necessitate a migration to something more scalable? What other accounting options might be a better fit for nonprofits?
Whether you're a trade association, a labor union, a professional society, or otherwise, there's nothing simple about managing the financials of a nonprofit association. The day-to-day challenges of dues collections, fundraising, budgeting, and reporting do not let up. It may seem as if you need to build a technology empire just to handle these demands.
What if there was accounting software that worked so well that it gave you clarity on your financials and left you with more time to focus on your association's mission—accounting software that left your sanity intact...?
Nonprofits today are operating under growing pressure to be accountable and transparent. In order to secure funding, an organization must demonstrate a high degree of efficiency and sustainability in achieving their mission.
Most nonprofits are happy to oblige, of course, but there are two key issues: first, how can you ensure that your nonprofit’s performance is meeting high enough standards? Second, what parameters best show the state of your organization, and how can those be displayed in a friendly, understandable format?
by Saeward Schillaci, The Resource Group
If you work for a nonprofit, you probably experience certain financial headaches that are unique to your type of organization. By their very nature, nonprofits are required to have clear goals and transparent finances. A nonprofit needs accurate, understandable financial reporting to show to its boards, committees, and donors as well as to make decisions that will help accomplish the mission of the organization without wasting resources.
Of course, this is easier said than done. Many organizations find themselves spending far too many hours manually manipulating financial data in outdated spreadsheets in order to have reports that show the right information. This, in turn, can mean that getting the most up-to-date information possible can be a major headache for overworked accounting teams. Good software, and hard work are all crucial to nonprofit financial success. Chances are, you already have the "hard work" part covered; however, it's time to find the right financial software solution for your organization so you can achieve maximum success with minimum resources.
This is the seventh and final post in our blog series: Best Practices for Selecting Nonprofit Accounting Software
The typical accounting software lifecycle is 5-10 years for nonprofits, so you’re looking at a long-term investment. Keeping your new accounting software viable is achieved by implementing upgrades and proactive maintenance.
You just need to plan for it: all vendors have different schedules, with some offering major upgrades every year, quarter and some releasing new service packs every month. All of the above is greatly simplified with cloud accounting software.
Below are additional guidelines to ensure that you get the most out of your nonprofit accounting software so that you can instead focus more of your energies towards achieving your mission.
This is the sixth post in our blog series: Best Practices for Selecting Nonprofit Accounting Software
Congratulations! You've decided upon the right accounting software for your nonprofit, gotten approval from your board and signed on the dotted line. This is truly an accomplishment, but now is when the rubber hits the road – it's time for implementation.
This journey can last anywhere from 3 weeks to 9-12+ months depending on the size of your nonprofit and degree of complexity. This blog post will help ensure a smooth implementation of your new accounting software.
If you're confused about Accounting Standards Codification (ASC) 606: Revenue from Contracts with Customers, you're not alone.
The effective date of the new revenue standard has been deferred until December 15, 2017 for non-public entities, but that still doesn't leave nonprofits with much time to prepare.
Here's some background and what we recommend.
This is the fifth post in our blog series: Best Practices for Selecting Nonprofit Accounting Software
In order for you and your team to make a final decision on which nonprofit accounting software is right for your organization, we recommend that you have your short list of accounting software providers come in and demo their proposed system.
Most nonprofits don't really think about how to get the most out of these demos. Many just let the presenter perform their standard dog-and-pony show, invite half their organization to attend and then struggle to determine which presenter is the best fit for them. Often, some of the attendees really like one presenter more because of their personality than substance, where the best fit software may have been presented by someone not as strong in presenting.
This is the fourth post in our blog series: Best Practices for Selecting Nonprofit Accounting Software
Once you've identified your final nonprofit accounting software candidates from vendors and partners, you'll next need to evaluate their proposals.
Considering that the effort is like comparing apples to oranges, here's how to effectively compare so you can choose wisely by leveling the playing field.
This is the third post in our blog series: Best Practices for Selecting Nonprofit Accounting Software
Once your nonprofit accounting software requirements are documented and prioritized, the search begins for the right software and implementation vendor – or, as we like to call it, a partner.
The internet makes it easy to build an initial list of candidates. Some websites even allow you to enter accounting software search criteria to generate a list of candidates but may put you on an email/call list. So, what's the best way to find a vendor and do you really need a partner instead?
This is the second post in our blog series: Best Practices for Selecting Nonprofit Accounting Software – The Importance of Documenting Your Requirements
No one wants to do it but documenting requirements from process owners, stakeholders and executive leadership will make or break the selection and implementation success of a new accounting software solution for nonprofits.
If done well, it will enable organizational growth. If done poorly, it could lead to hundreds of thousands of hours of wasted productivity (not to mention damaged reputations) that could otherwise help you advance your mission.
The new ASC 606 and IFRS 15 revenue management guidelines will have a major impact on public companies in 2018 and private companies in 2019.
The Financial Accounting Standards Board (FASB) and International Accounting Standards Board (IASB) will require companies to reallocate revenue each time a customer contract changes and defer expense recognition to align with the contract's delivery.
As a result, contract add-ons and renewals must be integrated into a single contract and will trigger re-allocations across both past and future periods, causing continuous revisions to revenue allocations and expense alignment.
This is the first post in our blog series: Best Practices for Selecting Nonprofit Accounting Software
Having easy access to mission-critical financial information is key to the growth for nonprofits, especially if you are expanding your services, opening new locations and winning more grants.
However, too many nonprofit business decisions are made with educated guesses from a patchwork of financial data drawn from your accounting software combined with spreadsheets, email and hardcopy reports. This time-consuming and error-prone process of consolidating even basic accounting data is a symptom of legacy accounting software.