Nonprofit Accounting Best Practices

Reduce Risk with 3 Accounting Best Practices for Nonprofits

Nonprofits want to focus on their mission, but that can be difficult to do when you’re constantly battling issues related to security, privacy, fraud, compliance, ethics, and more. These three accounting best practices can help you rein in risks and spend more time devoted to tasks that can help you achieve your goals and move the organization forward.


Best practice #1: Use accounting software designed for nonprofits

Nonprofits face different accounting challenges than for-profit enterprises, so it only makes sense to use accounting software designed to address those challenges. Look for software that’s used by nonprofits nationwide and that includes features like custom dashboards that allow you to track volunteer hours, grants, and other nonprofit-specific concerns.


Sage Intacct, the best-in-class cloud-based accounting software solution, is one such solution that can help you make everyday processes—budgeting, forecasting, grant management, fundraising, and HR management—more efficient. The software’s multidimensional database lets you aggregate transactions and activities across multiple grants, donors, locations, and more, so you can close faster and use real-time analytics to support better decision-making.


As an example of a nonprofit-specific solution, Sage Intacct and GuideStar have created a GuideStar nonprofit financial board book that delivers real-time visibility into several key facets of nonprofit operations. With real-time balance sheets, expense data, and revenue pulled directly from Sage Intacct, you can easily view financial health, mission impact, and sustainability.


Best practice #2: Implement internal policies and a code of ethics

Preventing fraud is absolutely essential, but doing so can be challenging. First, make sure you create internal policies and controls that are thorough and updated on a regular basis. Then implement a code of ethics to show your donors, employees, and board of directors the values of your organization.


Of course, creating policies and codes is only effective if they’re followed. Look for ways to involve employees, the board, and others in the creation of policies so they feel connected to them. Provide follow-up training to ensure the rules are followed and to answer any questions as they come up. And make sure that leadership sets the example and shows not only adherence to policies but an ongoing commitment to making them central to your organization.


Best practice #3: Spread financial practices across personnel

Another way to reduce the risk of fraud is to assign financial tasks to different employees across the organization. Results should remain the same. If they do not—if there are discrepancies, errors, or delays—then you can troubleshoot and determine what type of error is taking place and how to address it.


Spreading financial tasks to multiple employees also ensures that more than one employee knows how to complete each task. That’s a big help if employee turnover takes place. In the worst-case scenario where fraud is taking place, it also gives you a better chance of identifying it early so you can take corrective action.


Learn more

Insero & Co. is a public accounting firm with decades of experience working with nonprofit organizations. Our experts are available to help you identify the best practices that can help your organization reduce risk, streamline operations, and achieve your mission.

Nonprofit Accounting Best Practices

Use Data to Boost Donor Retention

Boost Donor Retention with Better Data

Improving donor retention is at or near the top of every nonprofit CEO’s to-do list. The eternal question is how to build better relationships with donors so they feel more connected to the organization and keep coming back to donate and support your cause for years and years.


One often-overlooked way to boost your donor retention rates is with data. Specifically, there are many ways to collect more data and use it more effectively to understand your donors’ needs and desires and to communicate more effectively with them.


Organize your data

If your employees are juggling a dozen spreadsheets and struggling to organize and streamline their fundraising and communication efforts, you’re going to have difficulties with donor retention.


A cloud-based accounting software solutions like Sage Intacct can help you streamline not only your donor accounting but also your grant, funding, and project accounting. Sage Intacct also integrates easily with third-party fundraising software, so you can automatically sync financial and donor information. The result is a more unified, organized system that can then support a more organized approach to donor retention.


Survey your donors

If you’re not sure how best to serve your donors’ needs, it’s a good idea to gather more data. Donor surveys are the fastest, most direct way to learn what donors want—and online donor survey platforms now make it easier than ever to reach donors online. Consider options like these:

  • Perform a yearly survey of all donors
  • Add a survey page to your donor confirmation emails
  • Create multiple versions of surveys for different donor subsections


Improve your data hygiene

Take a close look at your donor database software. Is it integrated with the rest of your software? How often are duplicate and outdated entries updated? How sure are you that you’re reaching all of your current donors?


Look for efficient ways to keep donor information updated in your database. For instance, if you send out surveys, ask respondents for their current contact information and household information, so you can update any outdated entries.


Put data to work for you

Insero & Co. is a public accounting firm with decades of experience working with both nonprofits and businesses. Our experts provide CFO consulting, software implementation, and other services that can help you improve your donor retention rates.


Boost Donor Retention with Better Data

Modernize Your Month-End Close

Why and How to Modernize Your Month-End Close

The month-end close is the accounting version of deep-cleaning the kitchen—necessary, yes, but also dreaded because it’s tedious and takes time that we’d much rather spend somewhere (anywhere) else.


The thing is, it doesn’t have to be that way. Month-end closes can take less time and be less fraught with concern over errors and oversights if you modernize with industry-leading financial management software.


Invest in the right software

Month-end closes can take up nearly the whole month if organizations use disparate accounting systems and rely on in-person handoffs. Investing in a fully integrated, cloud-based accounting software solution like Sage Intacct can streamline the process and save you hours of time every month.


Sage Intacct eliminates the need for manual data entry, external spreadsheets, time-wasting handoffs, and other steps that can slow down financial reporting. With integrated financial software delivering data in real time to online dashboards, it’s easy to monitor and react to issues as they come up, relieving some of the pressure on those month-end financial reports. Talk to one of our experts to help find the best solution for your organization.


See the results

Let’s look at what a difference Sage Intacct made to one nonprofit organization: MHA, an Association of Montana Health Care Providers. MHA used to rely on Microsoft Dynamics SL as its ERP system, but as the organization grew, the finance director found that they “wasted a week every month just managing inter-company transactions and balances.”


Since implementing Sage Intacct, MHA has been able to streamline accounts payable, accounts receivable, and general ledger entries. In addition, by automating consolidations and eliminating the need to manually enter hundreds of inter-company transactions every month, Sage Intacct has shaved days off MHA’s monthly close process.


MHA has found that a further advantage of Sage Intacct is its easy integration with other software solutions for payroll, budgeting, asset management, and more. Those integrations help MHA’s finance team save even more hours that they used to spend on manually re-entering data every month.


Modernize your close

Insero & Co. is a public accounting firm with decades of experience working with both nonprofits and businesses. From audit assistance to business consulting, our experts can help you find smart ways to modernize your accounting processes to be more efficient and productive.


How to Modernize Your Month-End Close

Score More Grants with Better Financial Data

Score More Grants with Better Financial Data

You can find dozens of suggestions for how to write better grant proposals, from incorporating case studies to keeping sentences short. But one key element that deserves more attention is the need to provide clear and precise financial data.


What funders want

One leading funder, the Meyer Foundation, spells out exactly what they’re looking for when reviewing grant applications and proposals: “Meyer staff pay careful attention to an organization’s financial statements,” they say in their FAQs.


Specifically, they say they want to know how healthy your organization is. And to make that assessment, they examine your proposal with an eye toward answering these questions:


  • Did revenues equal or exceed expenses?
  • Did the organization end the year with positive unrestricted net assets?
  • Is the annual budget approved by the board?
  • Do budgeted revenues equal or exceed budgeted expenses?
  • Are revenues and expenses (from the interim statement of activities) tracking in accordance with the annual budget?


Meyer Foundation expects applicants to include a Statement of Financial Position and a Statement of Activity. Beyond that? The additional reports you provide are up to you—which is why it’s so important to have the right accounting software in place.


The right software makes all the difference

One reason to implement a cloud-based accounting software solution like Sage Intacct is that it gives you the flexibility to respond to funders’ requests for detailed financial information. The advanced features of Sage Intacct make it easy to create customized reports, graphs, dashboards, and visualizations that clearly address funders’ questions.


You can take advantage of more than 150 pre-built accounting and financial reports in Sage Intacct, or build and customize your own for different proposals. Depending on what type of grant you’re applying for, you can filter, group, and summarize data by business drivers ranging from projects to departments to contracts.


Get the right data to win your next grant

With the right ERP solution, you can create detailed, visually appealing reports that give potential funders all the insights they need to gain confidence in your organization. Insero & Co., a public accounting firm with decades of experience working with both nonprofits and businesses, can help you find the right accounting software to secure more grants in the years to come.



Score More Grants with Better Financial Data

Streamline Your Expense Reporting

Solve the Top Challenges of Expense Reporting

Expense reporting is a vital process to ensure that you’re maximizing revenue and accurately tracking expenses on every project. It’s also a process that employees tend to dread—which means there’s a real opportunity to make improvements that will benefit your organization for years to come.


Challenges of clunky processes

Many businesses and nonprofits rely on outdated, inefficient, and overly complicated expense reporting processes, which leads to frustration for employees. These are among the signs that your process is behind the times:

  • Your travel and expense policy is complicated, requires a lot of employee time, and has resulted in multiple errors and inaccurate reports over the years.
  • Employees express confusion about expense reporting, asking a lot of questions that, over the course of the year, take hours of time to answer.
  • Reimbursements take a long time and are not provided on a regular schedule that employees can rely on.
  • Employees can’t submit expense information using their smartphones or other mobile devices.


Tips to improve expense reporting

If your expense reporting processes are out of date, the good news is that you can make significant improvements with a relatively small investment of resources. To begin with, audit your overall process to evaluate its accuracy, timeliness, and efficiency. Find out how many hours employees are spending on the processes—the answer might surprise you.


As part of your audit, be sure to talk you’re your employees about what they like and don’t like about current policies and practices. By involving them in the review process, you can get more buy-in on the changes you eventually make.


If you find real problems with your current processes, consider investing in automated expense reporting software. For instance, if you use Sage Intacct, a cloud-based accounting software solution, you can easily integrate third-party add-ons like Expensify, which provides real-time expense reporting—you set the policy, and Expensify automates the process, including syncing all data to provide next-day ACH reimbursement.


By taking a close look at your current processes and then streamlining them with new software or other solutions, you can maximize revenue and make sure your employees stay focused on business goals instead of spending hours on expenses, accounting, and reporting.


Make the right decision for your organization

Insero & Co. is a public accounting firm with decades of experience working with both nonprofits and businesses. Our experts are available to help you streamline your processes, including providing audit assistance and business consulting.



Streamline Your Expense Reporting

The 1,099 Hassles of 1099s

The 1,099 Hassles of 1099s

Preparing and filing 1099s is one of those IRS requirements that can really annoy accounting teams, requiring far more hours and effort than they can afford to give to such a mundane task. While there probably aren’t quite 1,099 hassles to 1099 preparation, it certainly can feel like it when you’re scrambling to get them all prepared and filed on time.


The many challenges associated with 1099s include:

  • Identifying contractors

    If your business or nonprofit hires independent contractors, freelancers, or vendors, and you pay them more than $600 in business-related payments, then you need to prepare and file IRS Form 1099-MISCs for them. That may sound simple enough, but there are lots of caveats, including that 1099s are only needed for provision of services, not goods, and are only for business services, not personal ones. Then, too, if the contractor provides materials as well as services, you have to separate the two.


  • Collecting W-9s

    You need to collect Form W-9, Request for Taxpayer Identification Number (TIN) and Certification, from all of your qualifying providers. It makes a lot of sense to get this upfront, but for various reasons that’s not always possible. Even if you have a good process in place to request the W-9 in a timely manner, some contractors are slow to provide it or don’t fill it out correctly, leading to last-minute requests and corrections.


  • Avoiding errors

    Contractors need to update their W-9s every year; if you rely on last year’s, the information may be out of date. As mentioned, even when you receive an up-to-date W-9, the contractor might make mistakes, so you have to ensure that the official name and the taxpayer information number (TIN) listed on the W-9 are correct. If you have to make corrections after filing, the IRS imposes penalties that get more painful the longer it takes for you to recognize the error.


  • Meeting deadlines

    The end of the calendar year is an especially busy time, and unfortunately it happens to be the exact time when 1099 demands hit. Organizations have to send 1099s to recipients by January 31 of the year following provision of services, and a copy also has to go to the IRS by February 28. Just to make things a little harder, individual states may have additional requirements and different deadlines for reporting and filing 1099s.


Reduce your 1099 struggles

Because preparing and filing 1099s is such a tedious process, many organizations are choosing to outsource the function. If you want to discuss 1099 filing requirements or explore the possibility of outsourcing the function, contact Insero & Co., a public accounting firm with decades of experience working with both nonprofits and businesses. Together, we can explore ways to streamline your accounting functions, so your employees can spend more time on business-critical tasks.



The 1,099 Hassles of 1099s

Take the Pain Out of Year-End Closes

Take the Pain Out of Year-End Close

For many organizations, the only thing worse than the month-end close is the dreaded year-end close.


Especially if you rely on manual, paper-based processes, the year-end close can require weeks of tedious effort, with a long list of iterative steps, including:

  • Collecting financial results from multiple systems and divisions
  • Consolidating all the financial results according to IFRS or other guidelines
  • Reviewing results for completeness and accuracy
  • Making corrections and reclassifying revenue and expenses wherever needed
  • Reconciling hundreds of accounts (or more)
  • Producing clear, understandable financial statements


And that’s just for starters. If you uncover unwelcome surprises along the way, the last month of the year becomes even more stressful.


Less Agony, Better Results

There is a better—much better—way to manage your year-end close. Cloud-based ERP solutions like Sage Intacct, make it possible to streamline, automate, and accelerate closes with very little hassle.


One way Sage Intacct streamlines month-end and year-end closings is by offering a virtual close, which means you don’t have to move income and losses for a given period into retained earnings. Instead, those earnings are handled automatically, based on how your chart of accounts is configured. It’s features like that which make it possible for Sage Intacct to claim its customers can reduce time to close by as much as 79%!


Sage Intacct also provides real-time visibility into data from across your organization, which makes it much easier to spot errors when they happen—as opposed to months later. All the relevant data you need, including journals, books, and transactional data, is available at your fingertips, and accessible 24/7 from mobile devices.


The combination of automated processes, deep data analysis, real-time visibility with intuitive dashboards, and consolidated reporting—to name just a few key features—makes transitioning from manual ERP solutions to Sage Intacct worth considering, especially before your next year-end close.


Make the right decision for your organization

Insero & Co. is a public accounting firm with decades of experience working with both nonprofits and businesses. Our experts are available to assist you with your month-end and year-end closes, and with other ways you might be able to streamline your accounting processes.


Take the Pain Out of Year-End Closes

5 Tips to Better Manage Your Cash Flow

5 Tips to Better Manage Your Cash Flow

It seems straightforward: Your business or nonprofit needs to know what you owe others and what they owe you. That’s your cash flow, and managing that cash flow accurately and consistently is one of the basic elements of accounting.


Look more closely at cash flow management, and you’ll find that it’s not so simple. As with every accounting process, there are good and bad ways to go about it. There are processes that work well and others that will cause you trouble—if not today then down the line. There are also advanced elements that can help separate your organization from the competition.


Let’s look at five tips for managing your cash flow not only to get by but to be more efficient and productive.


Step 1: Establish firm collections practices

When do your clients or customers pay you? If your answer is “it depends” or “it’s a long story,” you probably need to strengthen your accounts payable practices. Make sure your policies are clear, and make sure someone is keeping an eye on receivables—you might want to assign a single person to the task. That person should contact customers if they are late with payments, and persist as necessary to collect all your receivables as quickly as possible.


Step 2: Pay on time, but not early

It’s good business to pay your bills on time, every time, but that doesn’t mean you should pay a large bill the day you receive it. Check the payment terms—net 30, net 90? Then establish a process to ensure the bill is paid toward the end of the available term. This is assuming, of course, that you have cash on hand to pay the bill—if you don’t, that’s a more serious cash flow problem than the ones we’re addressing.


Step 3: Invest in the right software

Especially as your organization grows, it’s wise to invest in advanced accounting solutions such as Sage Intacct, the best-in-class cloud ERP platform. Sage Intacct’s cash flow management software provides a complete picture of your cash position on a secure, customizable dashboard accessible from anywhere. You can view all payments and all transactions across bank accounts and credit cards, and across every location and entity—and it’s ready for you in real time.


Step 4: Forecast your future

Look for accounting software that offers predictive forecasting capabilities, which provide access to accurate, automated cash flow forecasting across your entire organization, at the click of a button. The best solutions can generate models of your projected revenues and expenses related to sales, capital investments, and other information. The result is a crystal ball of sorts—a comprehensive picture of what lies ahead so you can better manage your cash flow.


Improve cash flow management

Better cash flow management processes can help you grow your organization with confidence. Insero & Co. helps organizations evaluate best-in-class software solutions to streamline cash flow management and other accounting practices.


Manage Cash Flow with printed reports from finance system

The Latest Tech Trends—And Why You Need to Know About Them

The Latest Tech Trends—And Why You Need to Know About Them 

Accounting and financial management are changing fast with the introduction of a dizzying array of new technologies and tools, from online solutions to new mobile accounting applications.


Determining which tools and trends are worth adopting, and when, is a challenge that businesses and nonprofits need to consider with care.


Which emerging technologies are worth your time?

It is remarkable how many new technologies and trends have emerged in just the past 10 years, and you can expect the pace of innovation to increase from here thanks to machine learning, artificial intelligence, the Internet of Things, blockchain, and other digital technologies.


One increasingly popular trend is to move from on-premises accounting software to cloud-based accounting software solutions like Sage Intacct. By moving to the cloud, you can improve visibility, streamline reporting processes, and make it easier for your clients and colleagues to collaborate and exchange information. In addition, cloud-based accounting can help you:

  • Analyze more data in real time
  • Scale as needed, with potentially unlimited storage space
  • Access information securely anytime and anywhere, from any device
  • Automatically back up files in the cloud


Another advantage of Sage Intacct is that it makes it easy to integrate third-party tools that offer benefits to your business or nonprofit. For instance, a growing number of applications are available to streamline expense reporting, automate accounts payable, and speed other common tasks.


You’ll also want to evaluate targeted technologies such as optical character recognition (OCR), which can scan printed and handwritten documents and convert them into machine-readable text. That means you can take handwritten documents, or even photos of documents, and turn them into electronic documents that are easy to store and share.


Why stay on top of the latest trends?

There are dozens more emerging technologies and tools that are worth considering because of their potential to deliver significant business benefits, including:

  • Better customer and client experiences. Many technologies will help you deliver better customer service, which can provide a significant competitive advantage.
  • Streamlined operations. The less time you and your team spend on mundane tasks, the more time you can devote to important responsibilities that build business value.
  • Cost savings. The latest tools can save time, reduce training costs, improve productivity, and offer additional cost-saving benefits that lead to a stronger bottom line.


Get the help you need

It can be a daunting task to learn about and evaluate the value of every new technology that hits the market. For help, some organizations turn to an outsourced accounting partner to sort through all the options and identify which ones fit their needs.


Insero & Co. is a public accounting firm with decades of experience working with both nonprofits and businesses. From audit assistance to business consulting, our experts are available to help you identify the latest solutions to make your organization more efficient and productive.


The Latest Tech Trends—And Why You Need to Know About Them

The Right Accounting Tools for Grant Reporting

The Accounting Tools You Need for Grant Tracking and Reporting 

Winning grants is great news for nonprofit organizations. But managing those grants can be a time-consuming challenge for the accounting team, which needs to track, bill, and report on every one of them.


To streamline that process, it is important to have the right accounting tools in place, which often means moving from Excel-driven charts to more advanced cloud-based accounting software solutions such as Sage Intacct, which provide powerful report visualizations, as well as real-time reports that make it easy to drill down to the details that matter.


Save time and deepen insights

With a more feature-rich accounting software platform like Sage Intacct, you can easily centralize all your grant documents from corporations, foundations, government agencies, and more.


Simply import data from your membership and donor software, regardless of source or award type, and you can report and compare your grant budget to actuals on grants with reporting periods that differ with your fiscal year. It’s simple to search and report on grant delivery, impact metrics, and financial data, which can save you hours of time.


The customizable dashboards in Sage Intacct allow you to monitor all your grants in real time and collaborate easily within the system to ensure that budgets line up with performance and delivery. The dashboards clearly display non-financial metrics that are used regularly when creating grant reports or fundraising campaigns, including the number of clients served and how that figure compares to the prior year.


If your organization is involved in a grant to increase membership, you could easily see on the dashboard where membership stands today. Then you could drill down further to compare and contrast different membership groups.


More broadly, advanced software platforms give you more visibility and control across operations. By centralizing task tracking for grants and other projects, you can see at a glance what needs to be done and when. As your grant is used, you can monitor spending and track the budget plan in real time. And deadlines are a lot easier to meet when you can collaborate online with team members to ensure milestones are met.


Streamline your grant reporting process

Insero & Co. is a public accounting firm with decades of experience helping nonprofits achieve their missions and streamline their business processes. Whether you need business consulting or audit or other services, our experts are available to help.


Tracking and Reporting