subject: The Truth In Non Profit Organizations [print this page] When you are engaged in a non profit organization, it is very easy to just be lax about your processes as well as your records. The sad thing about this is, although non profit organizations need not worry about profits and losses, the lack of an updated book of accounts can prove to be a recipe for disaster.
A culture of accountability is actually very important in a non profit organization. After all, records of a non profit organization need to be made public and should be presented to donors and other fund providers. Each fund source would also spell out specific reports that need to be submitted every now and then. IRS would also require you to submit form 990. This means that a check-and-balance system should be in place in order to ensure that all figures are correct and are entered properly.
As a person running a non profit organization, you would also need to be sure that any funds raised from a specific activity should only be spent on the cause you have raised it for. For example, if you started a concert meant to raise funds for a feeding program, all money that you get from the said concert should be spent on the feeding program alone.
This complexity and tediousness in running a non profit organization is the prime reason why there is a number of nonprofit accounting software that can be found in the market today. Although there is no universal approach to any accounting system, these applications can still help ensure the accuracy of the reports that you generate. It can also help you drill down where each cent has gone.
In choosing a software application to handle your accounting non profits, you would first need to check whether what you have in mind is flexible enough to handle your various needs. Seek an application that can be customized to suite the various fund sources and fund types that you have. It is also recommended that you go for an application that has strong budgeting capabilities.
Since most people involved in managing non profit organizations are no accountants, it would be a good idea to get a nonprofit accounting software application that has an easy-to-understand user interface. That way, you can set the ball rolling in a matter of days.
