Management and Leadership in Nonprofits


Three Signs Your Nonprofit Organization Is Outgrowing Its Accounting

Dec 12, 2018
By: Shereen Mahoney

Growing your nonprofit, meeting the expectations of donors and grantors and giving back to the community are all atop your list of goals in 2019, but with growth comes a common challenge: managing your people. Too many organizations face the growing pains of trying to lead a change without increasing budgets for back-office tasks and relying on unfocused or entry-level accounting software to manage the complexities and pitfalls of a growing nonprofit.

Basic Tasks Take Longer Each Month

One of the biggest challenges that nonprofits face is achieving their goals with fewer resources. Stricter reporting, more stringent regulations, higher expectations from donors — nonprofits have to deal with higher expectations and do so with fewer people and resources. Often these tight budgets trickle down to the finance department, who often use outdated, undersized or unfocused software because “that’s what’s in the budget” or “we’ve always done it this way.”

Unfortunately, there comes a time when the status quo no longer gets the job done and your finance staff is putting in more work to accomplish the same tasks. This is a painful point for any organization experiencing growth, but for nonprofits, this increase is only set to get worse due to new compliance expectations and donor requirements, which we will discuss below.

Monthly closes take longer, annual reporting becomes more stressful and your organization is still digging through spreadsheets to try to get the job done. Too often, this lack of functionality will result in employees being forced to cut corners to keep up, and a misplaced decimal could spell disaster in the long run. Technology is often the best solution. Sage Intacct provides nonprofits an affordable way to automate their financial processes, simplifying everything from closing the books to annual reporting. An ideal solution for companies and nonprofits outgrowing their current solution, this software saves time and money for thousands of nonprofits each year.

Regulatory and Compliance Challenges

From the new ASC 606 revenue recognition standard to 2016’s Financial Accounting Standards Board (FASB) guidance on nonprofits, you’re facing new and ongoing compliance challenges that dictate how you operate. Most notably, nonprofits need to adapt to the 270-page FASB 958 standard that changes the way they report everything about their organization, including their:

  • Statement of financial position
  • Statement of activities
  • Statements of cash flow (direct and indirect)
  • Statement of functional expenses
  • 990 reporting worksheets

Required to take a new look at both financial and disclosure information, nonprofit employees are saddled with even more work in order to get their job done each month, quarter and year. Therefore, if closing the books already takes more and more time each month, these increases are just the beginning, as new standards will make it even harder for organizations with outdated software to get the job done.

In one of its most recent updates, Sage Intacct introduced new functionality with the nonprofit end user in mind, adding prebuilt compliance and disclosures dashboards to provide a centralized location for both your quantitative and qualitative information.

Reporting on New Metrics

One of the biggest trends in the past five or so years has been the move away from the traditional metrics like overhead, with more focus than ever placed on outcome measures — the progress that a nonprofit is making towards its mission and vision, goals and strategies, and tactics and activities.

Outcome measures are powerful, essential tools for demonstrating accountability and transparency for an organization, providing a real-time assessment of what the organization defines as success or expected performance. This insight and visibility allows proactive management that can help ensure program, performance and mission success.

For many organizations, effectively and accurately reporting on these measures could be the difference between landing a large donation or grant or watching it go to a similar enterprise. Donors want results, and outcome measures are the most effective way to communicate them. Unfortunately, if you’re relying on antiquated software or platforms not designed with nonprofit users in mind, it’s likely you are struggling to provide basic information. Advanced, detailed metrics like outcome measures are often a pipedream.

Sage Intacct is designed for the reporting needs of the growing nonprofit. It’s able to provide not only compliance metrics for regulatory and taxation purposes but also donor-focused outcome measures. Providing easily accessible dashboards, reporting with Sage Intacct is simple. The software will work with the information you have, compiling and calculating it to provide the insights that you and your donors want to see.

Learn More: Sage Intacct for the Nonprofit Organization

Nonprofits, in the wake of competition and scrutiny, have to make every dollar work for them while improving the outcomes for those they serve. Doing so requires proven solutions that have helped hundreds, if not thousands, of nonprofits to simplify and thrive. Sage Intacct makes it easy to take control of your nonprofit organization, offering the automation and reliability you need at a price you can afford.

At Wipfli, we help nonprofits with every facet of their business — including software selection and implementation. Learn more about our work with Sage Intacct, and contact us for a consultation.

Get to know more about overcoming the challenges for growing your nonprofit by reading our two-part series, Crossing the Rubicon: How Committing to Technology Can Benefit Nonprofits and Crossing the Rubicon Part II: How Organizations Can Successfully Navigate Change to learn more about your journey to change management and technology.


Shereen Mahoney, CPA
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