Category

Accounting

Nov 26
0

Plan for Growth with Dedicated Nonprofit Accounting Software

By | Accounting, Accounting Software, Nonprofit | No Comments
person using nonprofit accounting software on laptop

Over 23 million companies use QuickBooks, the standard small business accounting software. Approximately 8.6% of users are nonprofit organizations. For nonprofits growing beyond the startup phase, QuickBooks offers a better way of managing financial and accounting data than spreadsheets alone; however, it has many limitations. If your organization currently uses QuickBooks and has begun to feel frustrated with these limitations, we will explore alternatives and next steps to move beyond simple accounting software and into nonprofit-specific accounting software.

QuickBooks for Nonprofits

QuickBooks has become the de facto alternative to spreadsheets for many businesses, including nonprofit organizations. The nonprofit version includes donation tracking, fund accounting, and specialized reports.

Many nonprofits struggle with several limitations within this version. It is not especially helpful for houses of worship, for example, which often spend considerable time, money, and effort customizing income, expenses, and reports. It does not scale easily so, if your organization is growing rapidly, you may find the system hinders more than helps your productivity.

Lastly, it is not made to integrate with other platforms, which results in siloed data. Organizations find themselves extracting data from QuickBooks and uploading it into Excel to run reports and data visualization, both of which defeat the purpose of moving from spreadsheets in the first place.

A QuickBooks Alternative for Nonprofits: Sage Intacct

If your organization encounters these limitations, Sage Intacct is an alternative to QuickBooks for Nonprofits.

There are many reasons why Sage Intacct provides an excellent alternative to QuickBooks. Here are our top three.

  1. Automation
  2. Integration
  3. Enhanced reports

1. The Benefits of Accounting Automation

If you have ever had to copy and paste data, upload data into your accounting system, or generate PDF invoices and email them to customers or clients, you know how time-consuming manual processes can be. Consider how long it takes to run end-of-month or end-of-quarter reports, prepare invoices, and email them. Think about how long it takes to follow up on invoices, create data visualizations, and conduct other vital accounting tasks.

Many of these routine tasks can be automated with nonprofit accounting platforms like Sage Intacct. Sage designed the platform with automation in mind, which means you do not need an IT person to program the automation—you can do it yourself.

One good example for nonprofits is expense approvals. In many organizations, approving expenses is a manual process. A staff member must email an approval form and receipt to a manager who approves it in writing. Then, the documentation is sent to accounting to reimburse the employee. This process requires several emails and often several days to complete.

Sage Intacct automated the process from start to finish. Once employees enter expense information into the system, it automatically routes it for approval. This single automation can save minutes for several employees, adding up to hours of potential time savings in a year. And that’s just one automation!

2. Integration with Other Software

QuickBooks is notoriously finicky to integrate into other software. This results in siloed data and a stand-alone accounting system. This may be acceptable for small organizations, but as your organization grows, you will want to generate comprehensive reports encompassing multiple management departments. The best way to accomplish this is through integrated platforms that share data seamlessly.

Sage Intacct offers excellent integration within the Sage suite of products and other platforms. Whether your organization sells memberships, workshops, or other online activities and needs e-commerce integration or wants to improve communications with a customer relationship management (CRM) platform, Sage Intacct offers seamless integration. Users can choose from 350 integrations in the Sage marketplace or use APIs (application programming interface) to integrate with their chosen platforms. This makes Sage Intacct an excellent choice for organizations that require their accounting systems to integrate with multiple software platforms.

3. Enhanced Reports

Most accounting software comes with standard, out-of-the-box reports. These include profit and loss statements, balance sheets, income statements, sales reports, and similar standard financial reports. Nonprofits, however, often need additional reports and added depth to the information to report to boards, auditors, constituents, and donors the effectiveness of their programs and how their money is spent. Standard accounting packages rarely include these reports or require extensive customizations to create them.

With Sage Intacct, you will have access to many reports that accommodate numerous nonprofit financial accounting needs. It even accommodates FASB-required financial reporting requirements.

Ready to Step Up? Learn More About Sage Intacct

As your organization grows, you will need a comprehensive accounting system that accommodates nonprofits’ unique financial reporting and accounting needs. Consider Sage Intacct as you plan for future growth.

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 us for more information.

Nov 19
0

Integration, the Key to Donor Management Automation

By | Accounting, Accounting Software, Donations, Nonprofit | No Comments
person at computer using integration management software

Donor management encompasses all marketing and communication steps necessary to attract new donors and nurture existing donor relationships. Tasks included as part of the donor relationship management process include attracting new donors through marketing campaigns, events, advertising, and more; follow-up communications with new donors, such as thanking them for their gift and sending required information for tax purposes, and continual marketing to them through newsletters, advertisements, personalized emails, direct mail, and more. Lastly, data from donor campaigns must be analyzed and interpreted to build on successes and retire unsuccessful campaigns.

This mostly manual process benefits from automation. Automation in the donor management process reduces manual tasks, streamlines data and reporting, and can enhance donations. However, to automate the donor management process, nonprofits must ensure that their donor marketing or customer relationship management (CRM) and nonprofit accounting platforms are fully integrated.

Why Is Integration Vital to Donor Management Automation?

Integration of critical platforms, such as donor management software and nonprofit accounting systems,  ensures that all data is up-to-date and accessible in one place, reducing the risk of errors and data duplication.

Enhanced efficiency is another significant benefit. Automation through integrated systems streamlines administrative tasks like data entry, donation tracking, and reporting. This frees up staff time to focus on strategic activities like donor engagement and fundraising campaigns.

Improved donor relationships are also a key advantage. With integrated systems, nonprofits can personalize communications and interactions based on comprehensive donor profiles. This helps build stronger relationships and increase donor retention by ensuring timely and relevant outreach.

Finally, integration ensures seamless communications. All channels, such as email marketing, social media, and event management tools, work together cohesively. This creates a unified experience for donors and ensures consistent messaging across platforms.

By integrating their systems, nonprofits can enhance their operational efficiency, improve donor engagement, and ultimately increase their impact.

Five Ways in Which Automation Helps Donor Management

There are many ways in which automation helps donor management. These include:

  1. Reduced manual data entry: With system integration and automation, data entry is reduced or eliminated. Donor information entered into the accounting system flows seamlessly into the CRM and vice versa. This saves significant time and effort.
  2. Eliminate mistakes: By reducing manual data entry, your organization can reduce the chance of mistakes and duplicate data.
  3. Better reports: Integrated CRM and accounting platforms also ensure that as donor information is updated in the CRM, the accounting information is automatically updated too. This ensures that reports generated from the accounting platform contain the latest information.
  4. Improved insights: Integration ensures that reports contain data from multiple sources, leading to better insights. Such reports can also be generated rapidly, leading to more accurate decision-making about donor campaigns. Marketers can capitalize on trends and respond swiftly to opportunities.
  5. Enhanced donor communications: Automated donor management can also enhance communications by sending customized thank-you letters and follow-up campaign materials.

Take Advantage of Automated Donor Management Today

As you can see, nonprofits receive many benefits from integrating CRM and accounting platforms and automating their donor management tasks. Start today with a comprehensive review of your existing platforms. Which may need to be updated? What can be integrated? Then, look at the possible benefits of donor management automation. What can your organization achieve through automation?

With the answers, you can take the next step and ensure software and systems are prepared to accommodate automated donor management programs.

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 us for more information.

Nov 12
0

Prioritizing Digital Transformation Efforts Improves Nonprofit Financial Management

By | Accounting, Nonprofit | No Comments
person at computer keyboard with "digital transformation" overlay

Digital transformation has moved up the list of CFO priorities this year. Some grapple with aging systems that lack productivity and efficiency enhancements. Others find the hiring cycle taking longer than expected and a lack of applicants for nonprofit accounting jobs. These and other pressures are mounting, forcing CFOs to seek alternatives via technology that can help them manage the ever-growing complexity of nonprofit financial reporting and accounting.

One way in which prioritizing digital transformation initiatives can help CFOs meet many of these challenges is through the adoption of modern platforms with AI enhancements built into the system. AI, or artificial intelligence, has now made inroads into many business applications, offering everything from easier expense approvals to automation that enhances efficiency.

How GenAI Benefits CFOs

There are many ways in which GenAI can benefit CFOs:

  1. Improving automation, which reduces or eliminates manual tasks and enhances productivity.
  2. Enhancing donor communications, which can improve donations and cash flow.
  3. Increasing data visibility, which improves forecasting.

Reduce or Eliminate Manual Tasks to Enhance Productivity

Many CFOs face a lack of qualified candidates for open positions. According to The CFO, 83% of senior accounting leaders report a talent shortage, up from 70% during the previous study period. Fewer students major in accounting, and many senior accounting professionals are retiring in the next 5-10 years.

To compensate for the possibility of fewer people working in an accounting department, CFOs must think ahead and incorporate automation whenever possible. Although no computer or GenAI model will ever replace a skilled accountant, technology can significantly improve the speed at which many tasks are performed and completely automate manual tasks.

Tasks such as emailing invoices, routing expense reports, and preparing data for auditors can all be automated through GenAI-enabled accounting platforms. Some may require human oversight and review, but AI-enabled systems can organize the information quickly and efficiently.

Enhance Donor Communications for Improved Cash Flow

For many nonprofits, donations are an essential cash flow component. Without a steady stream of donations, many programs cannot be funded. GenAI-based personalization and data analysis can improve donor communications and marketing, resulting in better cash flow to specific programs or to the whole organization.

GenAI can, for example, analyze donor patterns and suggest proactive communications to maximize peak donation cycles. By analyzing previous years data, an AI model can predict when marketing communications should be sent to constituents. Many AI-enabled customer relationship management (CRM) or donor management platforms can also personalize communications based on multiple data points, including the recipient’s name and past donation history. An animal rescue, for example, might send Jane Doe an email for a special spay and neuter campaign in November based on her previous donation pattern. Meanwhile, John Smith receives requests to fund a special donation drive for the cats in the rescue in December. Such personalization in the past was difficult and time-consuming; today’s AI models and computer-based digital marketing systems make it faster and easier.

By enhancing donor communications through AI-assisted platforms, nonprofits may find their donation streams increasing, thus improving cash flow.

Better Data Visibility to Enhance Forecasting

Most organizations collect a significant quantity of data which can be challenging to analyze manually. GenAI offers the ability to analyze large datasets with minimal time and effort, resulting in better reports. Such reports can be used for forecasting, making it easier for CFOs to update and adjust budgets and improve reporting to boards, stakeholders, and constituents.

The Starting Point for Digital Transformation 

Prioritizing digital transformation initiatives and AI-based programs helps nonprofit CFOs in many ways. The good news is that some of the accounting and finance platforms you may be using already offer some form of AI; updating or upgrading to the latest version may also offer an easy way to add GenAI to your tech stack without spending a lot. Other options include third-party tools and platforms that integrate into your existing accounting or finance platforms.

Now may be a great time to develop a digital transformation plan. This plan can include any necessary software upgrade, including upgrades that would add GenAI to critical areas where efficiency gains outweigh potential costs. Use it as your starting point to improve your organization’s accounting and finance departments and help you achieve the margin that fulfills your mission.

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 us for more information.

Oct 16
0

Empower Your Mission: Why a Robust Budget Is the Lifeline of Every Nonprofit

By | Accounting, Nonprofit | No Comments
person at laptop with screen overlay of budgeting numbers and graphs

In the ever-evolving landscape of nonprofit organizations, a strong and well-structured budget is not just a financial plan—it’s the backbone of your mission. A robust budget empowers nonprofits to allocate resources effectively, plan for the future, and ensure sustainability. Without a solid financial foundation, even the most passionate and impactful initiatives can falter. Here’s why a comprehensive budget is essential for nonprofits to thrive and continue making a difference in the communities they serve.

A Budget Is More Than Numbers – It’s a Strategic Plan

A budget is more than just a financial document; it is a strategic plan that guides a nonprofit organization towards its goals. By outlining expected revenues and expenditures, a budget helps nonprofits prioritize their initiatives, allocate resources efficiently, and make informed decisions. It serves as a roadmap, providing a clear vision of where the organization is headed and how it plans to get there. With a well-crafted budget, nonprofits can anticipate challenges, seize opportunities, and ensure that every dollar spent aligns with their mission and long-term objectives. In essence, a budget transforms an organization’s vision into actionable steps, paving the way for sustainable growth and impact.

Using Budgets for Planning

Financial sustainability can only be achieved with a well-prepared and continuously monitored budget. Conversely, a poorly developed budget can diminish mission-focused activities and opportunities and threaten long-term success.

Typically, the budgeting process should begin three months before the end of the fiscal year to ensure the budget is approved before the start of the fiscal year. It is important that each of the following budget process best practices are used to develop the budget.

  • Review the current financial status, including income and expenses. Compare it to the existing budget and forecast the remainder of the year. Then, analyze it for variances. Explore the reasons behind any variances.
  • Establish a timeline to review, discuss, and examine revisions. Three months before the current budget runs out should be adequate time.
  • Identify goals for each program area, whether it is increasing revenues, decreasing expenses, or both. Then, collaborate with the program leaders on these goals.
  • Draft a sample expense budget to develop strategic, organizational, and program goals. It is important to break expenses into variable expenses, fixed expenses, incremental expenses, indirect and in-kind expenses.
  • Do the same with income. Draft a sample income budget.
  • Include a variance (typically 5%).
  • Review the budget drafts with each department and make any adjustments as needed.
  • Let the Finance Committee do the final deep dive and polishing of the budget. Present it to the Board and make any requested changes.

You’ll need to assign people to monitor the budget, as well as strategic touch points throughout the year to ensure the budget is on track. Using a nonprofit accounting platform can help make this task easier for all.

Zero-Based or Activity Budgeting?

There are many approaches to budgeting. Some organizations base it on activity, some on the prior year’s budgets.

Many have adopted zero-based budgeting. Zero-based budgeting is a budgeting method where every expense must be justified for each new period, starting from a “zero base.” Unlike traditional budgeting, which adjusts previous budgets incrementally, zero-based budgeting requires a fresh evaluation of all expenses, ensuring that only essential and efficient costs are included. This approach helps organizations optimize their spending by aligning it with current needs and strategic goals, rather than relying on historical expenditures.

Budgets: A Strategic Plan for the Upcoming Fiscal Year

Your budget is more than numbers. It can be a strategic plan to guide the organization’s activities and focus for the new year. Building a strong and realistic budget provides an excellent blueprint for the upcoming fiscal year. It provides clarity and communicates expectations to all stakeholders. Engaging everyone in the process early, and reviewing budgets together often, can also help keep everyone on track.

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 us for more information.