Has Your Nonprofit Organization Outgrown Its Small Business Accounting Software?
Review five signs that indicate your organization has outgrown its small business accounting solution.
Over the past decade, nonprofit organizations have dealt with new challenges, including rising donor skepticism and increased scrutiny from the IRS. In recent years, the IRS significantly revised Form 990, which includes questions to gauge accountability, and requires nonprofits to provide more information if they have gross receipts of more than $25,000 annually.
Generic, entry-level accounting software solutions such as Quickbooks® may initially allow an organization to thrive, but as the organization grows and gains multiple funding sources, they find these solutions can’t meet their unique tracking and reporting needs.
As organizations grow and become more complex, they often begin creating work-a-rounds to deal with the fact that they’ve outgrown their small business software. Some common indicators include:
#1: Difficult to Audit
Your organization should be able to easily access reports of every action that takes place within the system, who completed that action, and when the action took place. Entry level accounting software solutions such as QuickBooks® have audit trails that can be turned on and off leaving you in the dark. Fund Accounting software designed for nonprofits provides your organization with the financial transparency you need.
#2 You’re Frustrated by Product Limitations
You can’t get your financial statements directly from your accounting software and you find yourself completing complex calculations and data manipulation outside of the software. With Fund Accounting software, you won’t have to seek external solutions, like Excel to get the job done.
#3 Non-Compliant Reporting and Insufficient Business Intelligence Capabilities
There isn’t enough functionality to track information by program, grant, location or whatever breakdowns are most critical to your organization. A true Fund Accounting solution offers an internal report writer and access to standard reports designed for nonprofits.
#4 Unable to Perform Nonprofit Accounting Tasks
Month-end allocations of administrative costs require the use of complicated Excel spreadsheets that are prone to error. Spreading payroll taxes and benefit costs across the various grants and programs has become an all-day event. Allocation management is a standard feature in Fund Accounting software and is designed specifically for nonprofit financial management.
There are other common signs your organization has outgrown its small business accounting solution.
Interested in taking a look at Fund Accounting Software designed for Nonprofits? Contact John Haney at 260.423.2414 to schedule a personalized demo.