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MIP Fund Accounting 2019.3 Releases on September 19, 2019

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Here’s what you need to know about the MIP Fund Accounting update, v2019.3.

This release contains high-quality updates, expanded reporting capabilities, more flexibility and usability and a number of improvements within the Payroll module.
Improvements in the release:
  • Reports:
    • Financial Statements – Statement of Cash Flows – added the default format for the indirect method
    • Financial Statements – Statement of Activities – added option ‘Include Unposted Transactions’ in the report
    • Accounts Payable – Vendor Activity – added filter ‘Zero Activity’ to get vendors with no activity
  • Payroll:
    • Added additional columns for more flexibility in reporting within payroll module
  • Organization:
    • Data Integrity Checks – Removed exclusive access requirement and replaced with a system lock search (disallowed when posting or close-year is in progress)
  • Improved Help experience:
    • Changed Help to be accessible via the web, enabling us to provide documentation updates between releases
  • Enhanced audit trail:
    • Activities – Reconcile Cash Accounts - added logging to the Summary Organization Audit when an existing Reconciliation ID is deleted
  • Quality improvements across MIP
Microsoft Support Changes

Please note the MIP v19.3 workstation installation will take additional time due to Microsoft .Net 4.8 framework being required. If your machine already has .Net 4.8 installed or your IT professional installs .Net 4.8 prior to the MIP workstation installation, please disregard this message.

Windows Versions of MIP released after January 31, 2020 will no longer be supported on Windows 7 SP1.

Support trending topics:

Ready to move your MIP to the cloud?

Even if you haven’t joined the group of cloud adopters, you’ve probably considered it, researched it, or discussed it with your peers. If your organization is ready for a deep dive, now is a good time to check out the benefits of MIP Cloud. Or, request a custom demo with us now.

Five Tips for Accurate Form 990 Reporting and Filing

By | Tax | No Comments

One of the most important financial filings nonprofit organizations must complete annually is IRS Form 990. For smaller nonprofits, this form may be the only action it takes each year to provide comprehensive financial information to the public and other organizations, such as grantors or charity watchdogs.

According to the Journal of Accountancy, Form 990 is one of the more challenging IRS forms. It’s complex, lengthy, and intimidating. The following tips may make reporting on 990 easier for your organization.

Which Version Should You File?

As with the personal income tax form 1040, there is an “EZ” version and a standard version. Nonprofits with gross receipts of less than $50,000 may wish to consider completing the EZ version. It’s always a good idea to meet with your accountant or with Welter Consulting to discuss which form may suit your nonprofit better and the advantages and disadvantages of each.

If your organization earns gross receipts between $50,000 and $200,000, you can choose between 990 EZ and 990. Any organization earning more than $200,000 should complete the standard 990. Private foundations, regardless of income status, must complete 990-PF.

Prepare for Filing

Gather your financial information, calculator, pens, paper, and records before sitting down to work on your 990. Some like to print a paper copy of the form and use it as a draft version. Once they are satisfied they have completed the form, they can then transfer it to the online filing system.

If you are using a not-for-profit accounting system such as Abila MIP Fund Accounting, it is easy to review the financial information needed for form 990. Others still using spreadsheets or general small business accounting software may need more time to review the numbers, find all the information, and prepare their report.

5 Tips for IRS Form 990

As you work on form 990, keep the following in mind:

  1. Do not include unnecessary personal information: Form 990 is made public and often shared with other organizations. Including personally-identifying information should be avoided as much as possible. In today’s world, with rampant identity theft, thieves find information through many sources, including published data. Don’t make their job any easier than it already is – do not disclose anything other than what is required.
  2. Complete parts I through XII: You can’t skip any parts between I and XII if you are filling out form 990 standard. Some mistakenly believe sections do not apply to their organization, but the IRS requires completion of the entire form.
  3. Include required schedules: After completing Part IV, you will have a list of all required schedules for your form. The IRS recommends double-checking the schedules to ensure they are complete. Be sure to include “0” on lines without an entry and answer “yes” or “no” to each question as required.
  4. Complete Schedule A: Speaking of Schedules, all 501(c) 3 organizations should complete Schedule A. Organizations with a designation of 4947(a) should also complete Schedule A. Failing to complete this schedule can result in penalties.
  5. Sign the return: You’d be surprised at how often people forget this simple step. Sign, date, and file the return!

Although no one enjoys completing IRS forms, they are necessary to ensure all financial information is reported accurately and promptly to the government.  Nonprofits must adhere to IRS reporting guidelines or run the risk of losing their tax-exempt status. By completing Form 990 promptly and thoroughly, you’ll rest easy knowing it’s done for the year and have a valuable document demonstrating your organization’s financial status.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.

Myth-Busting: What Grantors Want You to Know

By | Grant Management | No Comments

Would you like to receive more grants for your organization? Who wouldn’t?

Even the most professional grant writer and  nonprofit organization would like to improve their chances of obtaining more grant funds. Grants, especially open grants that can be used for any expenses, are the financial lifeblood of many nonprofits. Some organizations still struggle with achieving their funding goals.

The reason may be as simple as a misunderstanding. If you aren’t familiar with what goes on at foundations or other groups offering grant funds, you may be giving up too soon in your quest for additional funds. Here’s what granting organizations wished their grantees knew before, during, and after the application process.

Five Myths About the Grant Process

Myth #1: Grantors have all the power in the relationship.

Fact: Grantors wish you’d consider them as equals in the partnership. After all, they want to give funds to organizations that support their mission. They want to partner with you to see that goals are achieved on both sides. Treat them as equals and partners in your mission, and you’ll build better long-term relationships.

Myth #2: Make your pitch first, then ask for funds.

Fact: Instead of a pitch, consider dialoguing with the granting organization. Talk about the common interests and issues you both face and how these might be addressed. Then discuss the potential funds to help address the issue. Instead of making a big lengthy sales pitch, conversation and dialogue interests grantors more than being sold an idea.

Myth #3: Our “no” means “no,” so don’t ask again.

Fact: If you receive a negative response, try again another time. It could mean that the mission alignment isn’t right, but it could also mean that funds have already been earmarked for other groups. There’s no harm in trying again, and you may be surprised by the response.

Myth #4:  We don’t mind multiple calls and talks.

Fact: Although grantors do appreciate conversation and dialogue, prepare for meetings with the same care and attention that you would when meeting with any other donor. Don’t waste a grantor’s time during meetings. Check their website or other resources for answers to your questions before asking. Take notes so that you do not ask the same question over again. Be respectful of the grantor’s time. And yes, they should also be respectful of your time. A grantor-grantee relationship is a professional relationship. Mutual respect and a professional approach is part of building such a relationship.

Myth #5:  If you act like you are a large, prestigious organization, you are more like to obtain grants.

Fact:  Grantors don’t care if you are from a small nonprofit or a large global nonprofit. What they do care about is an alignment between their mission and yours. They want to be sure they understand the mission and values of your organization and how their funds will be used to achieve the mission. Grantors value authenticity more than appearance. It’s okay to admit your nonprofit has only three full-time employees or a small budget. “Be yourself” is a good adage in any situation and especially when meeting with grantors.

Finding and Securing Grants Isn’t Rocket Science

It’s hard work, diligence, and common sense. Securing grants means developing relationships over time with grantors, who value the same things that you do.

To track, measure, and monitor your work, grant, or contract management software can help you remain focused and organized. It will also help you measure the real impact of your efforts. Cloud-based (web) software enables you to continually monitor and track grants and related information even while traveling.

Securing grants isn’t a mystery. When too many myths cloud the facts, it can seem like a mysterious process. Once the myths are busted, however, you’ll be in a better position to work with, not against, grantors to find additional funds for your nonprofit.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.

Alleviate Nonprofit System Scrutiny with True Fund Accounting

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A recent article in the NonProfit Times states that nonprofit hospitals that figure out how to absorb Medicare payments may do better than others. Hospitals have been under the microscope in the past year as more information has been uncovered surrounding their billing practices. With a greater push towards transparency in pricing, hospitals face greater scrutiny around their billing practices.

Yet charitable hospitals face the same pressures that for-profit hospitals face. The Affordable Care Act, for instance, requires nonprofit hospitals to assess the needs of their communities once every three years and to offer financial assistance to patients who need help paying their bills. Given that costs continue to rise along with demand for service, that’s a tall order.

Senator Chuck Grassley (R – IA), chairman of the Senate Finance Committee, has asked the Internal Revenue Service to monitor whether nonprofit hospitals are indeed meeting their charitable obligations. He has also stated he intends to launch a probe into the situation to ensure that hospitals who qualify as nonprofits are indeed acting as such.

You may wonder how this affects your nonprofit organization. You may run an educational nonprofit, or an arts foundation, not a hospital. Why would anyone scrutinize your accounts and activities?

The time may be coming when all nonprofits face additional scrutiny. Greater access to information has alerted the public that nonprofits must fulfill their missions with the margin that they make. The public wants to know that their donations to charitable organizations goes towards their mission, not a mansion for the CEO or a Board member.

True fund accounting can help alleviate this level of scrutiny on your organization. Download our free white paper on the 10 Reasons Why Nonprofits Need True Fund Accounting Instead of a Commercial Accounting System here to better understand this topic.

What Is True Fund Accounting?

True fund accounting is software purpose-built for nonprofit organizations. Unlike typical “off the shelf” small business accounting software, true fund accounting software takes into account the unique blend of funding sources fueling most nonprofits.

While a for-profit company may also have multiple funding sources, they generally do not have the complexities of tracking funding back to its source at the level of detail required of most nonprofits. For example, a shoe retailer may account for revenue from its retail store chains and from its e-commerce site.

A nonprofit organization may have dozens of revenue sources, each with its own requirements. For example, an education nonprofit that is affiliated with a university may have several funding sources, each with different stipulations on how the funds may be spent. Grant funds from a large, private donor may be earmarked for particular programs while money from product sales may be spent on any and all operating costs.

This level of complexity is quite common among nonprofits and one reason why typical small business accounting packages and spreadsheets don’t work well for nonprofit accounting. True fund accounting takes into consideration the many variables at a nonprofit and the different ways that money may be tracked, spent, carried over, and more. The Chart of Accounts for a nonprofit may require multiple dimensions to fully understand it, and only true fund accounting accommodates this level of complexity. Typical accounting software cannot provide the appropriate level of detail most nonprofits need.

True Fund Accounting Helps Avoid the Spotlight

Senator Grassley mentioned scrutinizing hospital spending to ensure they aren’t dodging their mission as nonprofits – to provide healthcare to the vulnerable.

By using a true fund accounting program to track how the nonprofit hospital manages its payments and services, the hospital could publish its results and allow public scrutiny on its documentation. Senator Grassley and his colleagues might find that the multi-dimensional approach to the chart of accounts provides the level of detail needed to allay fears that the hospital isn’t fulfilling its mission. It could call up the facts it needs to placate the senators investigating its activities and assure the public that its charitable status remains intact.

No one likes the IRS knocking at their door. With increasing demand for transparency in hospital pricing and other nonprofit organizations, it’s time to pre-empt any arguments about financials by using true fund accounting. Find out more about true fund accounting systems from Welter Consulting.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.