Accounting Software Helps Control Costs
One of the best ways for any business to manage expenses and maximize profits is to use accounting software. Well designed accounting software will help any business to govern costs while boosting the efficiency with incoming cash flows and payments, outgoing bill payments and liabilities, and payroll are handled. This is an important component of all well managed organizations.
There is a very large array of options available for accounting software systems in the marketplace today. Most packages will include all of the vital core modules such as:
- Accounts receivable,
- Accounts payable,
- General ledger,
- Stock and inventory
- Purchase orders,
- Sales orders, and
The best packages will include non-core modules such as:
- Debt collection,
- Electronic payment collection,
- Purchase requisition,
- Reconciliation, and
- Departmental accounting.
There is also a bunch of industry specific accounting software systems geared to the specific needs of that particular line of business. I believe one of the most important of these is the creation of non-profit accounting software. This is a suite of accounting tools that are based on the highly specialized needs of the 501 (C) (3) industry.
Every nonprofit can realize the benefits from a nonprofit accounting software package. Even small organizations that make only a few basic transactions a month like deposits, withdrawals, and invoices can benefit from nonprofit accounting software. For these smaller organizations, an application like Microsoft Excel is not sufficient. In fact, Excel can be very dangerous as an accounting tool, because there are no built-in safeguards to keep you from deleting a transaction or accidentally duplicating or deleting a line on a report.
What To Look For When Selecting NonProfit Accounting Software
When considering specific nonprofit accounting software, there are a number of factors which should be kept in mind:
- What are the specific features?
- Is the software accessible to all levels of users or just the accounting department?
- Are work-around solutions necessary outside of the software?
- Will additional data manipulation with Excel be required?
- Is specific training easily available?
NonProfit Accounting Software Specifics
Specific non-profit accounting software must also take into consideration the specialized needs of the 501 (C) (3) industry. These will include:
- Fund accounting,
- Grant management,
- Specific reporting for the Board of Directors,
- Budget management,
- Accessibility for input at all levels,
- And available training for all employees.
Accounting Software That Meets The Needs
It is important to use nonprofit accounting software that meets these specific needs. 501 (C) (3)’s are very particular in their needs and requirements. Failure to take these specifics into consideration complicates and frustrates nonprofits from realizing their mission to serve people, while adding to the burden of reporting requests and rules.
When these needs are fully met, nonprofit organizations are empowered to serve their communities, fulfill their missions, while meeting industry best practices, and all legal requirements.
As you look seriously into nonprofit accounting software, be sure to look carefully into the issue of training your staff. Your accounting software will only be as effective as you need to be when your people are fully equipped to use the software.
Purchasing and integrating new accounting software is a major decision and a significant investment. Non-profits are very specialized and unique in their accounting practices. Take the time to carefully consider your options!
More Topics To Come
This article is the first of a series. Following this article we will discuss topics such as, “What Is a Nonprofit Organization And Is It For You?” We will be drilling down into more detailed subjects with topics about, “Fund Accounting,” “Grant Management,” “What is a 501 (c) (3),” and “Internet Marketing for NonProfits” to name a few. So, stay tuned there is more to come
Nonprofit Accounting Software