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Article Excerpt
Anyone evaluating software for a nonprofit organization must understand a basic premise: They require software with all the functionality needed by for-profit companies plus additional features that, in the absence of stockholders, help ensure compliance with federal, state and local regulations.
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Not-for-profit reporting requirements stagger the mind of a newcomer making the transition from accounting in the private, for-profit sector. Many assume that traditional accounting packages will suffice, until professionals are confronted with complex tracking, proof of community benefit, donor contribution detail, multi-year expenses and donations, and competitive vendor comparisons for virtually all transactions.
Add to this mix a strong dose of volunteer board members and public scrutiny stirred by a current IRS commissioner committed to uncovering fraud and abuse in the nonprofit sector. Accounting 101-- or even 501--doesn't begin to address the interrelated issues nonprofits face today.
As in the private sector, nonprofits run the gamut from small, one-site organizations serving single communities, to multi-million-dollar, multi-state conglomerates with interwoven products and services. Depending on income level, some nonprofits report only to the IRS (locally incorporated service clubs, women's clubs) while others, such as the American Red Cross, March of Dimes and multi-state hospital systems, face comprehensive oversight by states, the federal government, local government, Medicare/Medicaid and credentialing authorities.
Fortunately, numerous companies offer intricately detailed software packages that couple the best of traditional financial software with nonprofit reporting structures. Nonprofits particularly benefit from software that is easy to learn and use, minimizing disruption from staff and volunteer turnover. The software providers profiled in this issue clearly spent considerable time developing intuitive, quick-start software.
When evaluating software for your nonprofit client, keep in mind that each package targets an organization of a particular size or structure. Some individual providers also offer "stepped" packages based on budget or number of locations. A company's marketing material generally clarifies target users up front, and an organization should purchase only the functions it can use. A program too powerful for your clients' particular needs is confusing and wastes time and capital.
Confidentiality is the key word in the nonprofit world when it comes to specific recipient information, individual donor details, grant tracking, cost information and related issues. Today's software not only enhances your ability to secure this information; it also helps maintain compliance and control with features like extensive audit trails; tracking of various user actions; and access set by individual, group or function. These packages reviewed all demonstrate data integrity with an eye to strong internal control.
In the not-so-distant past, nonprofits employed individuals whose primary function was to enter data in tracking systems. Each report required tedious manual extraction and re-entry. Today's software eliminates the need for excessive personnel--or frees volunteer time for other important efforts--with data flow-through and system integration. Data can be sliced and diced in virtually endless combinations; dissected by cost code, budget or vendor; applied to a project or grant; and drilled down into departments, inventory or even donor. In addition, most data can be imported or exported into other programs for maximum reporting flexibility.
Used correctly and consistently, the latest software helps eliminate much of the confusion inherent in nonprofit reporting. Users can rest, assured their information will be timely and usable, and that they'll be equipped to answer even the toughest IRS audit question with ease.
By Alysia McDonald
AccuFund Maintains Customers, Vendors and Donors in One File
Developed for not-for-profit and government accounting, AccuFund Accounting Suite specifically covers all financial functions. It is not, however, a fund-raising or donor management program. The software accommodates organizations from $1 million to $100 million in annual revenue, with its largest customer segment in the $5-million to $15-million range.
AccuFund handily accepts imported data--a plus in environments where users need to integrate multiple forms, reports and sources....
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