What do project managers and accountants have in common? Both professions seek to minimize and manage risk. Although the two at first do not seem to have much in common, it is this commonality that makes project management a great field to study for hints on how to improve nonprofit financial management. Accounting for nonprofits can be improved by using the terminology, processes, and systems developed by the world of project management.
Partnering with Project Management
Good project managers know that every project begins with fact-finding and the creation of a project document, called the project charter, that provides the scope of the project with goals, milestones, and action steps. Accountants can take this concept even further.
Accountants understand the scope and flow of information within a company. Although they may not create the project charter, they can review it when created by other team members to ensure that nothing is missed. By collaborating with the project management team, they can act as support for the project rather than gatekeepers to the budget. It’s a subtle shift in roles that can make them more of a partner than an adversary within an organization
Managing Project Risk
Every project carries with it some risk. Accountants dislike risk even more than project managers! To mitigate project risk, you can take several steps.
- Remain involved in the project. Although you may feel as if you can delegate the project to others and provide only cursory feedback, it is best to remain actively involved in any projects. Watching and monitoring the work as it unfolds and progresses allows you to step in with advice and guidance as needed. As the project unfolds, your assistance may be invaluable.
- Ask questions like an auditor. Auditors look at each area and ask probing questions to uncover gaps that need to be fixed. You can work with stakeholders to uncover gaps, problem areas, and untapped resources within a project. Think like an auditor and ask insightful questions.
- Adjust for pressure points. Like a load bearing wall, there are going to be some people in the project management team who bear most of the load, especially around delivery time. Adjust around their schedules to free time for the project needs. Work with the project management team to apportion resources and prioritize around major tasks.
By staying close to the project from start to finish, you’ll have your finger on the pulse of the work and can offer advice and make adjustments to the project schedule as needed.
What About Scope Creep?
Nearly every project suffers from scope creep, that uncomfortable feeling that more tasks than originally anticipated are being piled onto the original scope of work. Some level of scope creep is inevitable, if undesirable. Changes may occur because new information comes to light, vendors have altered requirements, and other unexpected problems arise.
But other types of scope creep include the human element, or stakeholders piling work onto the project. If that’s the case, then accounting can act as the team member who validates and allows the request to go forward or pushes it to another project. As the person in charge of nonprofit financial management, you have a good sense of whether tasks might be requirements for the project or whether someone is padding it to help get work done. In that case, you know what to do…
Risk Assessment Post-Project
After the project is complete, an accountant’s job isn’t finished. Assessing post-project risk is another area where accountants can use their unique skills to contribute to the project.
Management may require a report on the project’s completion, budget, and open items. Nonprofit financial managers can lead and guide this effort to help uncover any areas left to complete and how these are best delegated.
The world of nonprofit financial management continues to grow and evolve. No longer limited to spreadsheets, audits, and taxes, the nonprofit accountant is an integral part of the leadership team. Project management skills can be learned and shared with groups to add value from an accountant’s perspective.
Nonprofit Accounting with Beck & Company
Beck & Company is a Washington D.C. area nonprofit accounting firm with a team of expert auditors, accountants, and advisors available to help nonprofits of all sizes. We provide a variety of consulting, auditing, and accounting services and blend knowledge from the accounting and nonprofit worlds to help you improve operations and efficiency. For more information, please contact us at 703-834-0776 x 8001.