How to Successfully Implement Change

3 Tips to Implement Change Successfully

You know what’s hard for organizations? Change. You know what’s worse? Standing still. Whether you need to implement a new corporate process or a new technology, it is critical to not only get the solution and strategy right but also to implement it in a manner that wins over skeptics and ensures long-term success.

Here are three tips for implementing change successfully.

3 Tips to Implement Change Successfully

Tip #1: Recognize that a great idea is only the beginning

Let’s say you know—quantitatively, unequivocally—that your organization needs to automate its accounting system. It’s an absolute no-brainer. If you think your work is done, that all you have to do now is implement your wonderful automated solution, you’re making a mistake.

 

Anytime you’re going to change something at your organization, recognize that there will be hesitancy and resistance. There always is when it comes to dealing with change. So you have to be prepared to tackle several issues that are not about the product but about the culture:

  • Win over management, so you have their support
  • Engage and educate employees
  • Identify opportunities for collaboration across affected divisions
  • Make sure it’s clear who is in charge and accountable

 

Tip #2: Make it a two-way conversation

Employees are less likely to get onboard with a new technology or other solution—again, regardless of how great it is—if they’re simply told after the fact what it is and why it’s good for them.

 

Avoid employee resistance by engaging, as many of them as possible in the full process, from strategy development through implementation. Often, they’ll have valuable, on-the-ground insights into what’s working and what’s not—and they’ll feel more empowered, valued, and engaged.

 

When you announce a forthcoming change to employees, make sure that you explain not only what it is but also why, how, and when it’s being implemented. If you’re not ready to answer all those questions, you’re not ready to announce the change.

 

Tip #3: Review and refine your change processes

After implementing a new process or tool, it’s important to evaluate how well it worked—not the solution itself but the change process. Ask questions such as:

  • Did management adequately support the change?
  • Was there employee resistance? How could it have been better avoided?
  • Was the implementation plan followed? If not, why not?
  • Did the change process move fast enough? Are greater efficiencies possible?

 

About us

Insero & Co. is one of the premier public accounting firms in Western, Central, Upstate, and the Southern Tier of New York. Contact us about our outsource accounting services, audit services, employee benefit plan audits, and how we can help your organization be more productive and efficient.

Why Automate Accounting Processes

5 Reasons to Automate Your Accounting Processes

Many businesses begin using manual accounting processes and continue to do so as they grow, often because of the appeal of maintaining the status quo. The problem is that at some point those manual processes can slow organizations down, hindering growth and innovation.

 

If you’ve been on the fence about transitioning to automated accounting processes, it might help to consider the following benefits of automating your accounting processes with Sage Intacct or other cloud ERP solutions.

 

  1. Save time
    Are your month-end closes taking up most of the month? Have you missed payment deadlines? Manual data entry is tedious and time-consuming, with employees spending hours on mind-numbing manual tasks instead of focusing on strategic tasks that add real value to the business.
  2. Be accurate and consistent
    Even highly skilled employees will occasionally make mistakes. Automation alleviates common data entry errors and ensures that every action is performed identically, so your customers, clients, and internal departments receive a consistently high level of service.
  3. Reduce costs
    Manual tasks almost always take longer than automated tasks, which means they demand more employee hours every week, month, and year. Automation reduces those work hours and helps prevent errors that can lead to unexpected additional costs.
  4. Increase visibility
    Using manual accounting methods, it can be extremely difficult to monitor, update, reconcile, and report on every internal process across the organization. When you automate billing, collections, sales, and other processes, you can automatically record and report on key metrics, in real time, so the information you need is always at hand.
  5. Reduce risk
    Automated processes can help you reduce the risk that you are out of compliance with the latest regulations or vulnerable to data breaches and other security concerns. Automated, cloud-based accounting solutions are automatically updated to adhere to the latest guidelines, and top providers follow strict security guidelines to protect your business and its data.

Automate Your Accounting Processes

Where to start?

If you’re convinced of the benefits of automating your accounting functions but overwhelmed by the challenge, remember that you can start slowly. For instance, you could automate your accounts payable workflows or audit documentation first, and move gradually to a completely automated solution.

 

Insero & Co. can help you weigh the benefits of automating your accounting processes and help you make the transition to best-in-class software. Contact us to talk about the relationship-based services we provide and how we can help you improve your processes to be more efficient and productive.

How to Implement a Board Assessment

Successful nonprofits tend to have healthy, energized boards of directors. Board members don’t just show up—they actively participate in meetings, fundraise, provide thoughtful oversight, and much more.

The challenge for many nonprofits is to build and then maintain a strong and engaged board. One way to do this is by performing a periodic board assessment, which can accomplish a number of important goals:

  • Illustrate (and reiterate) the board’s importance to the organization
  • Define roles and prevent duplication of effort among board members
  • Provide opportunities for self-reflection regarding strengths, weaknesses, etc.
  • Create a baseline for future efforts
  • Help begin essential conversations (about term limits, recruitment, etc.)
  • Provide a format for expressing concerns and raising or revisiting concerns

energized boards of directors meeting discussing a board assessment

How to build a board assessment

If you think your nonprofit would benefit from a board assessment, begin by asking these two fundamental questions, which will drive the framework for your assessment:

  • Why does this nonprofit exist?
  • How can our board help advance our mission?

There is no single template for board assessments. Depending on your needs, you can tailor the format, questions, grading scales, and more. For example, you might want to ask each board member to rate the board on a scale from 1-5 on topics such as performance on core responsibilities, understanding the mission, and succession planning.

Typically, you’ll want to describe each item you ask about, such as what exactly the board’s core responsibilities are. That ensures that every board member is responding based on the same understanding, and it helps to educate board members who may not have a full understanding of every topic.

Another best practice is to leave room for comments, which can add depth and insight to the results. Remember that your goal is not only to gather information from board members but also to encourage them to reflect on their individual and collective performance, which can lead to new ideas and insights, as well as a greater feeling of belonging.

When you collect and compare all of the board assessments, you can identify challenges, strengths, and opportunities, which can be relayed to board members. Using that information, you can then start to outline the topics of conversation in your timeline for governance agendas.

Learn More

Insero & Co. has worked with nonprofits for more than 40 years. Our experienced experts are available to help you with outsource accounting services, audit services, employee benefit plan audits, and other services designed to free you to focus on mission-critical work.

How to Find the Right Cloud ERP Software

The Basics of Cloud ERP Software

Just about every organization is already in the cloud or considering moving there. If you’re trying to decide whether to transition to cloud-based ERP software, you first need to understand some basic terminology. Then you can ask smart questions and identify the right solution to fit your business needs.

Multi-tenant vs. single-tenant

ERP software is built with multi-tenant or single-tenant architecture. Most organizations will benefit most from multi-tenant Software as a Service (SaaS) applications like Sage Intacct that were written exclusively for the cloud. With multi-tenant applications, the cloud provider shares infrastructure and applications across multiple customers and takes care of upgrades, security, and more. That means every user runs on the same software version, with updates and upgrades automatically applied across the business.

Single-tenant software versions—also called hosted or managed services—give a business dedicated access to the infrastructure and applications. Single-tenant solutions are typically more expensive than multi-tenant arrangements, and you have to manage the deployment much as you would for a private cloud.

APIs

Application programming interfaces (APIs) allow for communication between different applications. APIs are critical with ERP software because they allow you to integrate your ERP system with other cloud applications. Every ERP software solution will have APIs, but you’ll want to be sure they’re well-documented and have existing integrations with other popular cloud software products that you use, such as ADP and Salesforce.

Device agnostic

If a cloud application is device-agnostic, you can access it from any device, from desktops to smartphones, using any web browser. Make sure that any ERP software you purchase is device-agnostic, so you can add new devices without concern about accessibility.

SOC 2 compliance

All cloud-based ERP software providers will no doubt promise that your data will be secure, but how can you be sure? First, ask to be certain that their data center has been audited. Then ask if they are SSAE 16 SOC 1 or SOC 2 compliant (SOC 2 is strongest). If they say they are compliant, request a copy of their SOC 1 or 2 report, which they should freely supply.

Learn More

Insero & Co. can help you understand all the key features of different cloud-based ERP software solutions, and help you decide whether now is the right time for you to make the move to the cloud.

Key Tax Reform Changes for Nonprofits

What the 2017 Tax Reform Means for Nonprofits

Individual filers have already seen how the recently passed tax reform law—the Tax Cuts and Jobs Act of 2017—affected their taxes, including the good, the bad, and the unexpected. Now, it’s nonprofits’ turn.

 

The 2017 law features a number of changes that will affect nonprofits, including these three provisions that experts expect to be especially impactful.

 

Higher Unrelated Business Tax Income

The change likely to affect the most nonprofits is the addition of Section 512(a)(7), which eliminates deductions nonprofits used to be able to take for certain fringe benefits, effectively increasing unrelated business taxable income (UBTI).

 

Under this new tax requirement, you must include the cost of employer-provided fringe benefits for which there is no deduction under federal law (such as transit benefits and employee parking) in your UBTI. Nonprofits will have to pay taxes at the corporate rate of 21% on the qualifying benefits provided.

 

Building related to Key Tax Reform Changes for Nonprofits

 

Activities that Trigger For-Profit-Like Taxes

The tax law has a new section, Section 512(a)(6), that requires nonprofits to separately compute unrelated business taxable income for each trade or business. Previously, if you had multiple trades or businesses, you could offset gains in one activity with losses in another. The new section eliminates that option. You can carry your losses forward for a particular trade or business, but you can no longer offset them.

 

New Excise Tax on Executive Compensation

Nonprofits with high executive compensation need to be aware of Section 4960 of the Internal Revenue Code, which imposes a 21% excise tax on certain nonprofits that employ “covered employees” who receive either “excess compensation” (total annual compensation in excess of $1 million) or an “excess parachute payment” (severance in excess of three times a base amount defined as part of Sec. 4960).

 

Another new tax to be aware of is the Section 4968 excise tax that will affect some private colleges and universities by imposing an excise tax equal to 1.4% of qualifying institutions’ net investment income for the taxable year. This new tax will only apply to about 30 to 50 institutions in the country—just make sure you know if yours is one of them.

 

Get Help from Tax Experts

Those are just a few of the changes to the tax law that nonprofits need to know about. To make sure you’re aware of, and complying with, all the new requirements, talk with the tax professionals at Insero & Co. We can help you navigate all the latest changes and free your internal team to focus on more mission-focused work.

Weekly Cash Flow Forecasts

Why Weekly Cash Flow Forecasts Are Worth Your Time

Do you really need to create weekly cash flow forecasts when you already create monthly profit and loss statements (P&Ls)? Actually, yes!

P&Ls are not a true indicator of an organization’s inflow and outflow of cash. For instance, they don’t show the cash used to make payments on loans—only the interest you’ve paid on the loan. Also, they don’t tell you whether you’ve received cash for the revenue billed or whether checks have been written for the expenses recorded. 

analytical charts


Benefits of Weekly Cash Flow Forecasts

The many benefits of weekly cash flow forecasts include that they:

  • Provide an early warning of both positive and negative cash situations
  • Offer insight into when funds are expected to come in and be paid out
  • Can be used to plan cash movements to maximize investments and ward off cash shortfalls
  • Are useful for evaluating liquidity
  • Help predict line of credit needs
  • Can help you maximize purchase discounts and avoid late fees
  • Can assist with the timing of inventory purchases
  • Help gauge the impact of grant funding and billing delays

A Real-world Example

Imagine that your organization experiences a four-week delay billing due to an employee being out on medical leave, resulting in a shortage of cash and a need to draw on a line of credit. The P&L would show the total revenue billed but not when it was billed or when funds were expected. 

With a weekly cash flow forecast, you would not only see the impact on cash but also be able to time the line of credit draw. 

Challenges of Creating Weekly Forecasts

If they’re so helpful, why do some organizations choose not to create weekly cash flow statements? Mainly because it can be difficult to pull together timely, accurate forecasts on a weekly basis. The statements need to be simple enough to be read quickly and, as forecasts, they’ll undoubtedly include constantly changing data. 

Weekly forecasts are nonetheless worth creating for organizations that are willing to devote themselves to three key areas:

  • Critical thinking: Some data will be subjective and hard to find, so you need to be able to dig into difficult questions, make judgments, and have conversations with the right people to get answers.
  • Data collection: To get meaningful data, you need reliable financial systems and people who can provide up-to-date reports and information.
  • Smart models: You’ll need to decide whether to rely on a canned model for your statement or build your own model in Excel.

Need a Helping Hand?

Developing a helpful weekly cash flow forecast requires human interaction, good data, a hint of intuition, and experience. Insero & Co. can help you weigh the benefits of forecasts and, if it’s the right step for your organization, help you get started.

Benefits of Going Paperless

Why and How to Go Paperless

Some people still use flip phones, and some businesses and nonprofits still use paper. If you’re among the holdouts still hanging on to the old-school comfort of printed handouts and boxes full of documents, it’s time to take a deep breath and embrace a paperless world—a world that will be better for your organization.

Time to go paperless: a man is surrounded by paper in a glass office

Why Go Paperless?

There is an overwhelming list of benefits to going paperless—it really is a smart move for just about every type of organization imaginable. The benefits include:

  • Cost savings: Imagine not having to buy paper, copier ink and toner, envelopes, and file storage solutions!
  • Time savings: No more manually filing and searching through reams of paper documents—a few mouse clicks is all it takes for employees to find whatever they want.
  • Space savings: Paperless offices have less clutter on desks and fewer storage needs. Now your organization can grow without requiring more space.
  • Environmental benefits: One office does make a difference, given that it takes one small tree to produce about 10,000 pieces of paper. By going paperless, you can do your part to leave more trees in the ground, where they benefit people and the environment.
  • Better access: Need to read a document while on the road or at home? If it’s stored digitally, you can always access what you need.
  • Stronger security: More than a decade ago, it made sense to question the security of cloud storage, but now the cloud is far more secure than your office, where theft and natural disasters are a continuing threat.

 

How to Go Paperless

Probably you already recognize the benefits of going paperless, but how do you get unstuck and actually make the change? Start by making a plan that covers these and other concerns:

  • How will you convert physical files to digital files? It’s going to take some time, but it’s a one-time process. Decide what you need to scan, who will scan it, and when and how they’ll dispose of the paper documents once they’re done.
  • How will you convince employees to change their behavior? Employees might resist a top-down announcement, so you might want to involve them in the process, including listening to their ideas for making the transition successfully.
  • What will your new processes be? Decide how current paper-based processes will change. You might need new business software to help.
  • Where should we start? You might want to start going paperless by tackling “low-hanging fruit.” Can you shift to electronic billing statements, for instance? Achieve success in one area, and use that to build momentum leading to other changes.

 

Need a Helping Hand?

Insero & Co. provides audit, tax, outsourced accounting, and business advisory services to help you through every business transition. Contact us to talk about how we might be able to help you improve efficiency through the use of cloud-based software and other solutions.

Is It Time to Automate Your Accounts Payable?

Is It Time to Automate Your Accounts Payable?

Doing the work is only step one. Step two is getting paid and paying others—the vendors, contractors, and others your organization depends upon. And it’s step two, the accounts payable process, that presents both challenges and opportunities for businesses and nonprofits.

 

You probably experience the challenges every month. Bills stack up. Invoices are in various stages of the approval process. Checks are … Where are the checks again? Being printed, waiting to be signed, in the mail? These details and many more need to be recorded, without a single error, over and over again.

 

And therein lies the opportunity. If you can find a faster, more accurate way to handle accounts payable, you can devote more staff time to more valuable projects. Plus, you can build your organization’s reputation and keep vendors and contractors happy. That’s the opportunity available when you switch to an automated accounts payable solution.

Automate Your Accounts Payable

Is Automation for You?

Small businesses might not need to switch to an automated accounts payable solution—at least not yet. But if your business is growing, or you expect it to soon, automation is likely to be a smart investment, so you can stay ahead of increased workloads.

 

Other signs to look for that will indicate you should seriously consider an automated solution include:

  • Missing payment deadlines
  • Making data entry errors
  • Struggling to get payment approvals
  • Losing track of bills or constantly swimming under a stack of them
  • Hiring new accountants who prefer or are accustomed to automated solutions

 

The Advantages of Automation

A variety of automated solutions are available, the best known of which is probably Bill.com. With these automated systems, you no longer have to manually perform every step of the accounts payable process, from processing and routing bills to getting approval and recording transactions.

 

Instead, you simply create bills, enter them into the system—often a cloud-based payment platform—and move on to other tasks since the payments are sent automatically. If bills require approval, you enter approvers into your account, and they’re automatically notified when they need to review a payment, which they can do in seconds.

 

You’ll want to make sure that whichever automated accounts payable solution you choose, from QuickBooks to Sage Intacct, will sync with your accounting software. That way, you can ensure that your accounting books are always fully up to date.

 

Need Advice or Support?

Whether you want advice on switching to an automated accounts payable solution or are considering outsourcing some or all of your accounting functions, Insero & Co. can help. Our financial professionals have decades of experience working with nonprofits and businesses and are available to help you find smart, efficient solutions to your accounting challenges.

Do You Have the Right People on Your Financial Team?

The Costs of Building an Internal Financial Team

If you have a financial team in place that possesses all the expertise and experience your business or nonprofit requires, count yourself lucky. Many organizations find it increasingly difficult to find, train, and retain employees who can provide all the needed services at a high level of excellence for years on end.

 

The eternal search for that perfect fit can be costly, as demonstrated by the following three challenges of building an internal team.

Man pointing

Do They Know Your Industry?

Every organization has specific financial requirements that vary in sometimes obvious and other times more nuanced ways. Finding financial team members who understand the ins and outs of your industry can be difficult—and if they lack that knowledge, they could make mistakes or overlook new options or changing requirements, which could cost your organization in lost hours or fines.

 

Do They Have the Right Skills and Experience?

Accounting and financial management require a variety of technical skills, including expertise on the specific types of software you use. Employees also need to have both deep and broad experience in their specific field—years or preferably decades of experience.

 

If your employees lack adequate skills and experience, that means a lot of training and management time for you, which increases your operational costs. On the other hand, hiring—and keeping—top-end accounting staff typically requires paying them high salaries.

 

Will They Stay?

Every time an employee takes substantial time off or moves on to another job, you have to go back to the beginning—back to hiring and training another newcomer, which is a costly and time-consuming process. In addition, employees sometimes take critical knowledge with them, leaving you in a scramble to figure out how to plug the gaps they’ve left behind.

 

Time to Outsource?

If you have encountered these and other challenges in building your internal financial team, it might be time to consider outsourcing some or all of your accounting and financial management needs.

 

Insero & Co. has decades of experience working with hundreds of nonprofits and businesses, providing each with a dedicated team of experts who offer the service you’d expect of an internal team, combined with the cost-efficiency you can only get with an outsourced provider. Contact us today to talk about our outsource accounting and financial services and how they might be able to help you redeploy your internal staff to focus on more mission-critical work.

What Board Members Need to Know About Financials

What Nonprofit Board Members Need to Know About Financials

As a board member, you’re expected to use your skills and experience to help the organization achieve its goals. For nonprofits, that usually involves raising money. For any organization, it likely means providing management and oversight, assisting in specific areas of operation, and helping the organization through transition periods.

 

A key piece of all these endeavors is understanding the organization’s financial position. Without timely financial information, it’s simply not possible to monitor progress or make informed decisions about the future of the organization, not to mention the fiduciary responsibility of every board member.

women at computer working on charts

The Numbers Board Members Need

Each year, every nonprofit board member should receive IRS Form 990, which provides broad information about the organization’s mission, programs, revenue sources, and more. Form 990 is only the beginning, however, as board members also need monthly or quarterly updates on the organization’s financial information, typically provided in the form of:

 

  • Statement of financial position (balance sheet)
  • Statement of activities (income statement)
  • Cash flow forecast
  • Actuals versus budget
  • Other operational figures

 

If you are not receiving timely financial updates from staff, ask why this might be. If time or reporting capability is an issue, the organization should look in to upgrading to better financial software.

 

How to Make Metrics Meaningful

Reviewing the financial statements on a regular basis is the first step. The second is making sure that the reports you are receiving are easy to understand, relevant, and concise. Most board members do not have extensive financial or accounting expertise, and you shouldn’t need to! Ask your staff to think about the following when providing their board reports.

 

When possible, graphs should be used in lieu of tables of numbers or detailed line items. Trends should be shown, providing continuity between one report and the next. It’s also helpful to provide some explanation around significant items. For instance, the report might point out places where there is significant variance between expected and actual outcomes, and explain why that’s the case.

 

Ideally, organizations should be able to customize their dashboards to quickly provide the most relevant information to board members. Leading cloud-based accounting software solutions such as Sage Intacct provide powerful report visualizations, as well as real-time reports that make it easy to drill down to the details that matter.

 

The latest software makes it possible to view project profitability and other up-to-date metrics at a glance, as well as to easily flag trends, key comparisons, missed or hit targets, outliers, and other information that can give board members more helpful insights into the organization’s financial well-being.

 

Do You Have the Details You Need?

Even if you don’t serve on financial or accounting committees, as a board member you have a responsibility to know the financials of your organization. Insero & Co. has decades of experience working with nonprofits, businesses, and their boards. We’ll make sure you have the real-time, detailed, and easy-to-use financials you need to make the right decisions to move your organization forward. Contact us to learn more.