Nonprofit Accounting Blog – Page 9

Accounting for Nonprofits: Setting Transfer Pricing Policies

Accounting for nonprofits should including setting fair transfer pricing policies for organizations that buy and sell goods or services internally.

Transfer pricing is simply the price set for one division of your company to charge another in the event that it must ‘sell’ or set a price for its goods or services to another group internally. For example, if your creative services department is paid by members for graphic design services, you may also set an internal transfer price for their services so that if your membership division requests graphic design work, the number of hours spent on an internal project can be on the books in a similar way to an external paid request.

The problem with many transfer pricing situations is that the internal department selling the goods or services has an incentive to change the full amount, while the group purchasing it has an incentive to seek lower costs. The two may have difficulty negotiating prices since negotiations do not serve either party’s best interest. Instead, the purchasing group usually capitulates and pays more than it should for a service internally than they could get from an external source.

In order to make transfer pricing work, as part of accounting for nonprofits, the following tips and strategies may be helpful.

Enable better decision-making on internal pricing transfers: Smart accounting for nonprofits starts with accurate data. To make better decisions around setting prices, you must first have an accurate depiction of the costs that go into the goods being priced. This is where having a good nonprofit financial accounting system helps because it is easier to extract data from such systems and analyze it to build price points.
Build fair transfer-pricing policies: Written policies prevent miscommunications and mishaps during transfer policies. They also help organizations and companies set fair prices for all. A written policy can clarify how transfer pricing agreements can be reached and how to conduct internal transfers.
Assess autonomy levels: Some companies do well with a high degree of autonomy granted to both parties during a transfer negotiation. Assessing and understanding how much autonomy is healthy for your organization is an essential part of setting transfer pricing policies.

Why Bother with Transfer Pricing?

Accounting for nonprofits must include accurate depictions of both revenues and expenses, as well as labor costs, in order to make fair calculations. Without knowing what your transfer costs are, you could miscalculate and under- or over-estimate costs for your organization. Transfer pricing makes things fair, balanced, and transparent in your financials.

Recently, the IRS has also stepped up its review of nonprofit compliance with transfer pricing rules. Organizations that do not have documentation regarding their transfer pricing policies and rules may come under additional IRS scrutiny. Adjustments, penalties, and loss of tax-exempt status may result if the IRS investigates and finds your organization’s transfer pricing inadequately documented or handled. It pays to be proactive and take steps now to create the rules and documentation necessary to clarify how it is handled.

Although transfer pricing is most often thought of as a way to improve tax tracking and reporting, especially in cross-border transfers, it is also an integral part of accounting for nonprofits. Understanding and managing transfer pricing can help your nonprofit improve its financial management and compliance with taxation and financial rules and guidelines.

Accounting for Nonprofits with Beck & Company

If transfer pricing and other accounting for nonprofit topics are confusing for your organization, or you require audit assistance or other nonprofit accounting services, contact Beck & Company.

Beck & Company can help with your nonprofit financial management needs. We are a CPA and business advisory firm dedicated to the nonprofit sector. Our many years of experience can help you update your financial compliance or handle all types of accounting for nonprofits. Please contact Beck & Company today for further details.

Accounting for Nonprofits Update: The Brave New Work of Mobile E-Commerce

Accounting for nonprofits changes as times change. Nowhere is this more apparent than in how people shop. Since many nonprofits also sell goods, it’s important to know how shopping patterns are changing and how your nonprofit can keep up to date.

The past decade has seen a complete change in the way people shop for goods and services. Less than 100 years ago, people shopped at multiple, local single stores for items like clothing, shoes, furniture, groceries and more. Then came the big shopping malls, department stores and supermarkets, which promised convenience by gathering many goods in one location.

But the internet changed everything. Now you weren’t just limited to what you could find locally or through mail order catalogs. A virtual world of good was available at the touch of a button. E-commerce was born, changing how people shopped forever.

Because the only thing that’s constant is change, the world is undergoing another shift today: mobile commerce. Like its predecessor e-commerce, mobile commerce relies upon online transactions. Instead of logging in through your desktop computer, however, mobile commerce uses the smartphone or a mobile device to facilitate the transaction.

Mobile Usage Growing

According to the Pew Center for Research, smartphone use is up again throughout the United States. Their research states that 95% of Americans now own a cell phone of some type. Among those who own cell phones 77% own a smartphone. That number has grown 35% since the first survey about smartphone use was undertaken by Pew in 2011.

Many smartphone users access their devices for everything, including internet use, banking, shopping, and phone calls. Some do not have broadband access but rely upon smartphones for internet connectivity. This trend is expected to continue to grow, with more people relying than ever before on their smartphones.

What does this mean for your nonprofit? It means that if you aren’t onboard with the mobile evolution, you may be left behind – and leaving behind those you serve, too.

Accounting for Nonprofits and the Mobile Evolution

As more people join the mobile evolution and become wedded to their smartphones, nonprofits must also keep pace with these developments. This includes:

Opening mobile-optimized e-commerce stores: A website must be optimized for mobile viewing so that it changes it loads more quickly and with less data usage on a mobile device than it does on a laptop or desktop. This “responsive” website may already be built into your current site, or you may need to update your site so that it is responsive. A responsive site will help your nonprofit sell more, interact better with members, and accept donations via smartphone.
Create and launch mobile donation campaigns: Accounting for nonprofits includes fundraising. Campaigns aimed at mobile users include faster, shorter messages and other enhancements targeted at mobile users.
Add apps: Larger nonprofits may be able to afford the development of apps for their constituencies. Apps provide shortcuts for mobile users to your site and may be a valuable addition for improved interactions.

Nonprofits must keep abreast of technology updates affecting their members, donors, and supporters. If not, they are at risk of being left behind and having followers turn to other groups. Having a practical understanding of technology isn’t just a nice thing now, it’s a must-have. And for those working with accounting for nonprofits, an important commitment to the financial health and success of your organization.

Beck & Company

If you struggle with your accounting for nonprofits, Beck & Company can help. We are a CPA and business advisory firm dedicated to the nonprofit sector. Our many years of experience can help you update your financial compliance or handle all types of accounting for nonprofits. Please contact Beck & Company today for further details.

Nonprofit Financial Management Made Easier: Manage Towards Surplus

One often overlooked aspect of nonprofit financial management is managing towards a surplus or ensuring adequate margin to continue your organization’s mission even during lean donation years.

“No margin, no mission” is a saying often heard at nonprofit organizations. It means that without an annual surplus, your organization cannot achieve its mission.

There’s a delicate balance between being prudent stewards of your nonprofit finances and over- or under- investing in programs. Too much surplus looks as if you aren’t doing enough to fulfill your mission; deficits cause undue hardship and struggle. What’s a nonprofit to do?

Mandating a Surplus

One way to improve nonprofit financial management is to manage towards a surplus. A mandated surplus of X percent means that in any given year, a set amount of margin is set aside to act as a cushion against lean times. It’s a similar concept to putting aside money in an old-fashioned Christmas account or tucking ten dollars a week away in an account against a rainy day. For nonprofit financial management, the idea is to create a managed surplus that can be tapped into when donations or other sources of income fall.

A mandated surplus for every department in your organization may seem strange. What about the operational division? How are they supposed to create a surplus? It seems obvious that the finance, donor and membership management groups can work towards a surplus, but how do operational divisions manage it?

Departments that do not generate revenue but support other revenue-generating areas of the organization can budget towards a surplus by cutting expenses. By systemically trimming expenses, they can contribute towards the mandated surplus.

Preparing for Down Years

The economy will also rise and fall, so preparing for the down years is an essential skill of nonprofit financial management. It may not be possible to meet a shortfall through simple cost-cutting during a particularly difficult year. Mandating a surplus and banking that surplus against lean times is your insurance against having to cut essential programs or personnel in order to keep your nonprofit active during lean times.

What If You Exceed the Mandated Surplus?

Just as in some years you’ll find you have a deficit, in good years you may not only meet the mandated surplus but exceed your target goals. During such times, the Board may wish to discuss adjusting the surplus at their annual meeting. For example, if the mandated surplus target is usually 15% but an especially healthy year finds you with a surplus of 20%, the Board may wish to vote on adjusting the surplus down to 10% for a one-year term only. In this way, the mandatory surplus can be flexible without being an arbitrary number. Board participation, discussion, and voting are essential to making a flexible number work.

Tip to Make Surplus Budgeting Work

Many nonprofit organizations have successfully balanced their accounts and improved nonprofit financial management thanks to surplus budgeting. But in order to make it work well for your organization, you’ll need to focus your efforts on communications, strategic planning, and improved budgeting.

Some tips include:

Analyze your current financial situation. A good fund accounting program can help you with generating the reports of your accounts.
Assess each budget item, especially unrestricted funds. This is typically where surplus may be found.
Educate and communicate with all departments within your organization to ensure that everyone understands why you are seeking a surplus and how you anticipate being able to achieve the goal.
Align all portions of the organization towards the goal.
Underscore how achieving margin enables you to achieve your mission (money isn’t just for money’s sake but to help your constituents).
Develop strategic plans and budgets to achieve your goal.
Watch the progress carefully and be ready to change course depending on how well you believe you’ll achieve your objectives.

A surplus can mean the difference between a healthy, fully functioning nonprofit organization and one that limps along hoping for the best. Don’t hope or wish for the best – plan for it. With enough margin, you can surely achieve that mission.

Beck & Company: Nonprofit Financial Management Success

Great Ideas for Accounting for Nonprofits: The Policies You Can’t Live Without

Companies of all sizes have a written employee handbook that governs all aspects of employment. It doesn’t matter whether you have one employee or 100 employees – having a written handbook can help you avoid many common misconceptions that can lead to unpleasant employee relations and occasion more serious issues such as discrimination lawsuits. Among the many great ideas for accounting for nonprofits, creating an employee handbook can help everyone understand the company’s guidelines.

Five Points to Include in Your Employee Handbooks

A written employee handbook usually includes several points. Some are generic to most employers while others may be specific to your organization. The following five points are usually found within most documents of this type.

Anti-Harassment Policy: Every employee handbook should include an anti-harassment policy. Such a policy clearly states the definition of harassment, and states unequivocally that harassment within the organization isn’t tolerated. It should also include steps for handling harassment, who employees can report harassment to, and consequences for those engaging in harassing behavior.
Working Hours and Pay Practices: It is important to clearly state the hours your company is open and the hours employees are expected to work. Include information about scheduled breaks and meal times. Make sure that break and meal times meet federal and state guidelines for workers. The workweek should be fined, with overtime definitions explained. The pay scale for both regular and overtime work should also be defined. Such policies can help you avoid costly wage disputes later.
Leave of Absence: State whether employees are entitled to medical leave under the Family Medical Leave Act. Include details on how employees can request such leave, how much notice is required, reasons that qualify for leave under the act and other parameters for leave. If your company isn’t covered under FMLA but you do offer medical leave, include details on your company policy here.
Employees with Disabilities: State how employees with disabilities can request confidential accommodations for their disability under the Americans with Disabilities Act. Include details on who they should speak with and other information on how your company complies with the act.
Drug and Alcohol Policies: You should include information on your company’s drug and alcohol policies. In states where certain drug use is permitted, this is critical. Drug testing information should be included, and information on whether drug tests will be given prior to employment, at random, after an accident, etc. Additionally, you may also wish to include information on how to report potential substance abuse problems and what help is available for employees who may have a substance abuse problem.

Written Policies Prevent Misunderstandings

It’s surprising how often companies neglect to create employee handbooks, or they do not update what they have. As leaders in the accounting for nonprofits field, it is up to us to ensure that the organizations we work for have the best resources at hand to manage their finances wisely. An employee handbook can help with that in many ways.

Clear, unambiguous policies are less likely to put your organization at risk for a lawsuit.
Grounds for termination due to drug or alcohol violations can also be shared so that they are quite clear to all who work for the organization.
Overtime pay rates are clear for all in the organization.

Employee manuals and handbooks can’t keep your organization from every potential pitfall, but they do go a long way to ensuring clear communications for all.

Why the “Right” Relationships Matter for Accounting for Nonprofits

Do you have the ‘right’ relationships as part of your accounting for nonprofits?

We’re not talking about knowing the ‘right’ people – the smart people, the rich donors, or those who can provide services to your nonprofit, although such relationships are, of course, important.

Instead, we’re talking about a wide circle of relationships that provides feedback, including contrary feedback, a rich resource of new ideas, and the ability to introduce you to people beyond the scope of your existing work.

The right relationships are those that broaden your horizons, expand your work, and help you reach into new areas to improve, build, and develop.

Let’s take a look at the concept of relationships and how the ‘right’ relationships build your nonprofit’s work.

The Current Echo Chamber

If you’re like the majority of people, your connections on social media tend to fall into three camps: business associates, family, and friends. It’s the rare person who reaches outside of their immediate circle and seeks to connect with others.

Unfortunately, such a narrow circle of connections leads to the ‘echo chamber’ effect. People we know in daily life tend to reflect similar values and ideas back to us rather than confront and challenge us.

When you browse through your connections, if everyone in your immediate circle is connected somehow, or you spend a great deal of time with them daily, then you aren’t reaching out to people from whom you can learn. You’ve fallen into the echo chamber – and it’s time to climb out!

The Value of New Connections

It’s natural for people to be drawn to others with similar likes, dislikes, and interests. That’s how we initially learned to make friends, and similar interests bring people together over hobbies, social gatherings, church functions, and other places to meet people.

The problem with connections who share so many interests is that you never leave your comfort zone. If everyone in your immediate circle of friends is connected, there’s no one new who can reach outside and connect you to new networks of people.

New connections can help you…

Open doors: Looking to connect with a specific donor? Seeking to broaden the geographic area in which you currently work? People in your network may be able to introduce you to the right donors, help you find good places to spread your nonprofit’s work, and expand into new areas. When you move outside of your existing network, new opportunities may be just around the corner.
Seek new perspectives: When you meet new people, their viewpoints may contradict yours, but if you’re open to discussion they can help you see and understand new perspectives. This may give rise to a new way of looking at a project or different way of viewing the world.
Find new vendors: Connections are a great source of information to find new vendors, consultants, and partners for your nonprofit. They may also be a good resource to check references on vendors you are considering for work.
Hire new people: Another great way that a wider, different circle of associates can help you is by sharing job openings with their network to help you find the perfect employees for open positions. Many positions are filled today via word of mouth rather than through classified ads. Finding someone through your network has the added advantage of a personal recommendation from an associate, too.

Relationships matter. Even in today’s increasingly internet-driven world, where we often Skype, tweet, and comment rather than sit down over a cup of coffee with someone, relationships broker trust, enhance your knowledge, and help you and others in this world. Build the ‘right’ relationships by seeking new people with whom to connect, share, and network.

Beck & Company: Accounting for Nonprofit Success

Cloud-Based Nonprofit Financial Management: It’s Time to Make the Switch

Throughout all the years when you’ve been handling nonprofit financial management, you know that there comes a time when new technology becomes ubiquitous. The fax machine seemed novel at first but now is as common as a telephone. Telephones themselves gave way from rotary dials to touch-tone, then to cell phones and smartphones. Computers are now so commonplace that they’re as necessary as a chair and a desk to most offices.

Cloud computing has also entered this phase of adoption throughout the world of nonprofit financial management. Once seen as an intriguing concept, the cloud is now a part of most nonprofits’ daily business. It’s time you switched to the cloud.

Concerns About Switching to the Cloud

Some nonprofit managers have concerns about switching over to the cloud. They’re used to software running on computers within their office. Accessing everything through the Internet seems both odd as well as risky. Here’s are some of the potential concerns you may have about switching to the cloud and the facts.

Security: Cloud-based software is very secure. Your account is accessed through secure user names and passwords, and data is kept behind multiple firewalls for added security. Cloud providers must spend a great deal of time, money, and effort on security since they are keeping not just your data secure but that of hundreds of other customers. Cloud security is often better that security individual companies could enact on their own.
Costs: Cloud software is less expensive than site-based software because it is shared among multiple companies. Best of all, you do not need to invest heavily in expensive hardware and infrastructure to support a cloud-based system. All you need is a reliable and secure Internet connection and your typical PC, smartphone, or tablet to access cloud-based software.
Mobility: Older software had to be loaded onto an individual computer for users to access it. Cloud software can be accessed from any device connected to the Internet, so you’re not locked into using the same desktop or laptop. Data is also stored on the cloud so that users throughout your company can access the same information. It’s great for nonprofit financial management on the go.

How to Choose Your Cloud Provider

Ready to switch to the cloud? Choosing a service provider may take some time, but with the proper due diligence, you can find a great vendor who offers the support that your organization needs. When choosing a vendor, consider the following:

References: What do other companies using the vendor’s services have to say about their reliability and response time?
Support: Does the company provide 24/7 support? If so, how is the support provided – telephone, chat, help desk, user forums?
Data ownership: Who owns the data?
Backup: What is their backup plan? How often is their system backed up?
Security: Ask for details on the security provided on your account.
Downtimes: What is their average downtime, and why do their systems sometimes go down? Do they guarantee any level of service?
Costs: What are the costs and are they steady or do they fluctuate with data or storage use? What does the cost include?

Using these questions as a guideline, you can evaluate the services from several cloud vendors and make a smart choice for your nonprofit financial management.

Beck & Company: Cloud-Based Nonprofit Accounting Software

Beck & Company can help you choose cloud-based accounting software and other systems and services for your nonprofit organization. We are a CPA and business advisory firm dedicated to the nonprofit sector. Our many years of experience can help you update your financial compliance or handle all types of accounting for nonprofits. Please contact Beck & Company today for further details.

Make Accounting for Nonprofits Simple with Process Roadmaps

It’s a document your nonprofit can’t live without.

Have you ever looked up during a meeting and had that distinct deja vu feeling? “We’ve had this discussion before. I know we’ve talked about how to set up the tables for the annual charity ball at least a thousand times before!”

Well, maybe it wasn’t a thousand times before, but if your charity ball is an annual event, you’ve had the discussion about where to set up tables and chairs before. Most organizations do have a routine, a structure, a rhythm to their annual activities. Like the changing seasons, the annual audit, the annual charity dinner dance, raffle, or carnival is something you know will come up each year in the same season.

Yet many nonprofits find themselves scrambling to re-create such events. It’s as if the memory of last year’s event has been wiped from the minds of those who ran it. Given the volume of tasks the average nonprofit employee undertakes each year, it’s no wonder that they can’t remember the details of every decision. Hence the endless planning meetings and the deja vu feeling is so common to longtime nonprofit employees.

There’s a way to capture the information from activities that are annual events, organize, and share it so that if people leave the organization or change jobs within the organization, the new person leading the tasks has an easy way to learn what needs to be done. A process roadmap is a document that outlines the necessary tasks, people, equipment, processes, and other pertinent information so that you can smoothly hand off the task to someone else or duplicate it in the future. All it takes is a few minutes to document the necessary information to create your very own process roadmap.

An Outline of the Process Roadmap

A process roadmap simply lists the tasks needed to accomplish a project, with a detailed resource list added to flesh out the project. A simple process roadmap outline may look like this:

Name and title of the event or task
Last date the process was outline
Task owner (who manages the task)
List of steps in sequence of how to do the task.
Section that includes resources to complete the task
Due dates and timelines.

For an accounting audit, the process roadmap may look something like this:

Annual Nonprofit Audit

January 15

Owner: Jim Smith, Accounting Department

Steps

Call the accounting firm to request dates for audit. Confirm audit dates.
Reserve conference room.
Contact building security for temporary building pass card and parking sticker for auditors.
Contact IT for WiFi access for the auditors.
Request all accounting documents for audit by [date]
Call auditors one week before audit date to make sure everything is set up.
Send company-wide email the week before the audit to remind staff that the conference room is in use and that the auditors should not be bothered while they are working.
Clear calendar and do not schedule meetings while auditors are here so you can help them with what they need.

Resources Needed

Auditing firm [list name and phone number]
Conference room
IT department – reserve WiFi password
Building security [name, phone number, email address]

Due Date/Timelines

November – call auditing firm
January – audit date
- Two weeks before audit, reserve room and get parking spots.
- Week before audit, request WiFi access and send companywide email.

An effective process roadmap should be succinct; one page is usually sufficient. Make sure you keep the process roadmaps in a place where all employees can easily access them. The HR or accounting department are both great places to keep process roadmaps.

Make Accounting for Nonprofit Tasks Easier

Process roadmaps make accounting for nonprofits much easier. You can focus your time and energy on accounting when you don’t need to use it to figure out how to complete routine tasks.

Beck & Company: Accounting for Nonprofit Success

Accounting for Nonprofits: How Secure Is Your Data?

It seems like every time you turn on the television or browse the Internet, there’s word of another data breach. Even big companies who specialize in offering secure services like email aren’t immune. Hundreds of thousands of records are compromised each year, causing embarrassment to the companies affected by the data breach and heartache for those who are the victims of identity theft.

If you think your nonprofit is exempt from cyberattacks and data breaches, think again. Many nonprofits collect sensitive information that criminals would love to get their hands on: donor names and addresses, email addresses, credit card information. Passwords are also a hot commodity for criminals since they can be resold, and many people reuse their passwords across multiple sites. Any data that can be stolen from your organization puts you at risk, as well as your constituents at risk, for big headaches later.

There are many things that you can do as part of your accounting for nonprofits work that helps secure data and prevents theft. The following tips can help you manage the situation to stop problems before they start and handle them effectively in the unfortunate event that you do face a major data breach.

Tip 1: Find all your data sources.

You collect more data than you think. The first step to secure your data is to find and inventory all potential sources of data within your nonprofit.

Some of the more common areas where nonprofits collect data include:

Account set up: Do you encourage members to participate in online forums or set up an account profile on your site? That’s an area that collects a great deal of data.
Forums and chat rooms: Forums and chat rooms often require an account and these accounts collect more personal information from users during the set-up process.
Membership purchases and renewals: If people can join your organization through the website and fill out a membership application form, that’s another data source. Credit card information may also be collected via such forms.
Online stores: Member-only stores or online stores where your nonprofit sells items collect personal data, including mailing addresses, as well as credit card information and email addresses.
Employee records: Employees records include social security numbers and other information that could lead to identity theft.

Once you’ve listed all the places where your organization collects data, it’s time to find the best ways to protect it.

Tip 2: Create a data ethics policy.

A data ethics policy is an organization wide policy that spells out which data is collected, how it is stored and shared, and who may access it. Establish data-use goals and create a privacy policy for your organization. There are free privacy policy generators online that can help you easily and quickly set up an Internet policy for your website.

To create your data ethics policy, you can:

Establish guidelines for who can access data and how it may be accessed.
Create a shareable privacy policy and post it to your website.
Assess the risks after reviewing your data inventory. If there are any gaps in your online security, take steps now to fix them.
Add anti-virus software to your systems and servers.
Update your computer programs frequently. Companies issue patches and updates to fix problems and to close any gaps in the software’s programming that hackers have learned to exploit. Forgetting to update your programs leaves these gaps open to attack.
Perform due diligence on your data, especially if third parties have access to it. If you use an external fulfillment vendor or a drop shipping vendor for items ordered over your website, check on how they’re using and storing customer data. Make sure it aligns with your policies and directives.
Review mailing list protocols, especially if you use a list vendor or broker to mail our donation requests and other materials. Third-party mailing houses or email list vendors who send materials on your organization’s behalf should also be checked to ensure that data is being handled securely and carefully.

Tip #3: Create an action plan.

The last step is to create an action plan to manage your data security year-round as well as prepare for any potential data breaches. Although the IT department may be a good place to start with such a policy, accounting for nonprofits often means that the accounting department takes charge of such procedures. If so, your team should become well-versed in all the issues pertaining to data security and risk.

When it comes to preventing bad things from happening to good nonprofits, an ounce of prevention is always worth a pound of cure. Take steps now to prevent a data breach and ensure that the data your nonprofit collects remains safe.

Beck & Company: Accounting for Nonprofit Success

Accounting for Nonprofits: Goal Setting for Success

Accounting for nonprofits grows increasingly more complex with each passing day. New rules, regulations, and laws must be accommodated and followed to ensure compliance. Daily duties require your full attention, but then there’s the list of ideas you want to implement at your nonprofit organization. Your to-do list grows while your wish list languishes. Is there any way to tame the task-list tiger and gain control over what’s important to your organization’s success?

When it comes to accounting for nonprofits, the secret to managing your time wisely is in your approach to goal-setting. Goal-setting for accounting means establishing priorities and rubrics to weed out the unimportant so that you can grow what is important. The better your time-management abilities, the better you’ll be able to support your organization’s mission through critical accounting tasks and processes.

Questions to Ask to Establish Goals

Begin your goal-setting task by answering these questions. Then, use the answers to guide your priorities.

Can I delegate any of my tasks to my team? If you’re the only accountant at your nonprofit organization, you may be unable to delegate tasks to subordinates. But if you have a team backing you up, are there any tasks on your list that can be delegate to them to free up your time to focus on big-picture tasks?
Are you doing things just because they’ve always been done that way? Many organizations fall into the trap of continuing to do the same tasks every year simply because it’s always been done that way. Hosting the same event, running the same fundraiser, and enacting the same donation drives may be safe, but it may be unprofitable. Assess and evaluate the effectiveness of every activity before adding it to your task list.
Do we cling to favorite projects? Sometimes you keep tasks on your list simply because you enjoy doing them. These may be tasks that could easily be delegated to others, but because you love doing them, you keep them. Be objective during your evaluation of your work and see if you’re clinging to any projects because you have emotional investment in them.
Does this activity serve constituents? Align your activities to the needs of your constituents and you’ll find your priorities falling into place more easily. When the focus is on meeting your nonprofit’s goals, you’ll set your sights clearly on the tasks aligned with your mission.

Three Stress-Busting Nonprofit Accounting Tips

In addition to sorting your tasks based on the question above, the following three tips can help you prioritize your time.

Establish your group’s vision and purpose: When you create, establish, and share your group’s purpose and vision, it is easier to align the tasks of the accounting department with that purpose. Extraneous tasks fall by the wayside. It’s easier to say “no” to tasks that do not fit the group’s ideals, and that helps you prioritize and organize easily.
Diversify income: Just as in the for-profit world of investing, you want to diversify your income streams. Avoid relying on one grant or a single angel donor for all of your funds. Make sure you’re always cultivating new sources of income for your nonprofit organization. Partner with the fundraising team to ensure that they understand this concept too.
Measure results: Prioritize around those activities which generate the best results for your organization. Put your energy into those tasks with greatest chance of a good return on your time investment.

Better Time Management Enables You to Grow Your Margin

A strong nonprofit organization uses its margin to support its mission but you can’t focus on tasks that increase your organization’s margin when too many other tasks compete for your time. With this method, you’ll once again become master of your schedule, and your organization will flourish.

Beck & Company: Accounting for Nonprofit Success

Weather the Fraud Storm with Nonprofit Accounting Audit Services

Nonprofit accounting audit services can help you weather all kinds of storm. The “storm” most often feared is also a five-letter word: fraud.

Why do we fear fraud so much? It’s a taboo subject at many nonprofits. The word is never spoken. It’s as if by speaking the word, we fear we’ll bring it on ourselves.

Little children do crazy things to wish for bad weather like snow days. They’ll sleep with their pajamas inside-out, for example, following the old schoolyard fable that such sacrifices please the skies and encourage a nice blizzard and its attendance day off from school, sledding and snowman building, and hot cocoa.

We know wearing pajamas inside-out has nothing to do with the weather conditions that foster snowstorms, yet we exhibit the same type of superstitious behavior when it comes to fraud. We’re almost afraid to say the word for fear of calling it down upon ourselves.

Register for this Webinar Now: Survival Guide for Nonprofit Finance Teams

Instead of fearing the word, look it squarely in the eye. Face your fears and take proactive action to build a strong culture of honesty, integrity, and ethics within your organization. Make your organization so transparent that no one will think twice about uttering the word “fraud” because they know it’s impossible within your office.

Nonprofit Accounting Audit Services: Three Steps to Prevent Fraud

While we all wish life came with the same warning-sirens that herald a tornado or other severe weather alert, fraud does give off its own signals. They’re subtle, more like static than a siren, but you can still learn how to detect them in the nonprofit workplace and take steps to clear the static from the air so that fraud is difficult (or, we hope, impossible, for people to even consider). These three steps will be your warning and shelter from fraud.

Talk about it! Fraud isn’t a forbidden word. Some nonprofit workplaces are so afraid of even mentioning the possibility that they avoid talking about it altogether. If you don’t talk about the potential for fraud in the workplace, your staff won’t be on the alert for it. Make sure that fraud prevention, reporting, and resolution are all part of your employee handbook, training, and accounting practices. Don’t be afraid to talk to anyone who may have information about potential fraud. Keep an open-door policy so that everyone is comfortable speaking up if something happens.
Be aware: To prevent problems of any type, awareness is critical. Develop a culture of fraud prevention and awareness. Everyone should practice simple fraud prevention procedures such as always have two people count out cash or place checks into the safe. Create a series of best practices for fraud detection and prevention. As the accounting leaders in your organization, you have the opportunity to implement procedures to benefit your nonprofit.
Practice drills: Once everyone understands that fraud prevention is important to the organization and that the organization is serious about prevention, the last piece in the puzzle is to make sure that everyone understands the steps to take if they suspect fraud. “Practice drills” sound silly until you consider how many other emergency situations we practice for in life. Nearly every school, office building, and hospital practices fire drills and other emergency situations; shouldn’t your organization do the same to protect against losses? Practice “fraud drills.” Identify someone on the team who is a ‘safe’ person to report suspicions too. Have the numbers handy for your nonprofit accounting audit services so that if fraud is detected you have the go-to guys and gals on speed dial for immediate help. Write everything down into a simple procedure list so you have step-by-step instructions and action items at the ready.

With awareness, prevention, and reporting procedures in place, your nonprofit will be on dry ground when it comes to fraud alerts. While we all wish that fraud and other serious workplace events came with some kind of early warning signal, in the case of fraud detection, just being aware can be enough of a deterrent.

Financial Advice and Assistance for Nonprofit Organizations

Beck & Company Certified Public Accounts and Business Advisors specializes in nonprofit financial management, nonprofit accounting audit services, and issues pertaining to the world of nonprofits. We have extensive experience helping nonprofits of all sizes achieve their mission without sacrificing margin. Contact us for more information.