Tag: fund accounting systems

Fund Accounting Best Practices and Resources

Fund accounting records daily transactions based on a nonprofit’s specified funds. You may have a general fund, a project-based fund, and so on to track income and expenses around grants, donor bequests, or special projects. By setting up a system of fund accounting that’s clear and easy to follow, you can keep your general ledger clean and ensure that expenses, income, and capital are tracked accurately.

Benefits of Fund Accounting

Fund accounting offers several benefits to nonprofits. First, it confers greater visibility on your accounts so that the public can confirm that your funds are being used as you promise they will be. It also offers greater insight into the nonprofit’s overall fiscal health. Donors and granting organizations like to know that their money is going to be used to continue your work fulfilling your mission, and not to close down the organization or conduct your work only half-heartedly due to lack of funds.

You can also manage your accounting better when using fund accounting methods. As you manage each fund, you can clearly see where you may need to increase your fundraising efforts and where you may be on a firmer footing. Funds that are low can be shored up; funds that are robust can continue.

Organizations bestowing grants on nonprofits also like to know where, when, and how their money will be used. Fund accounting makes that task easier, and may improve your chances of gaining much sought-after grants.

Setting Up Fund Accounting Software

The easiest way to track your funds for fund accounting systems is by setting up your accounting software so that it can track funds from the get-go. Most software packages enable users to define specific general ledger fields. These user-defined fields can be used to tag specific fund accounts and keep the general ledger clean and manageable. You can set these up when you install an accounting software program.

Best Practices in Action

Once you’ve established your accounts and you know what you have to work with, you can then implement best practices and develop a plan to shore up low funds and utilize other funds more effectively.

A good fund accounting plan includes assigning accountability for the fund, relationship building strategies, fund solicitation strategies, and more. In other words, you’ve got to know what money you have in the fund and how you’ll continue to grow and nurture relationships to keep it coming in.

As you can see, fund accounting is more than entries into the general ledger. It’s about making accounting an integral part of your nonprofit planning and operations. Accounting techniques like this can help you make great progress towards achieving your mission.

Fund Accounting Help

Beck & Company works with many types of nonprofits to help them organize, streamline, and refine their accounting and operations. We can help you establish your fund accounting system or clean up one that’s already in place but may not be doing what you’d like it to do.

You may also be interested in an upcoming webinar on fund accounting best practices. It’s free, and provides many resources you can use to improve your financial reporting.

We work with nonprofits to transition them into new systems and help them enhance their business and accounting processes. We can help you select the best accounting system for your needs and help you transition to a new system with minimal disruption and downtime. Contact us today or call 703-834-0776 ext. 8001.

Training Your Team for Fund Accounting Systems: Tips for Successful Implementation

It’s go-time, and your staff is excited about the new fund accounting systems you’ve put into place. But wait: before launching the new system, have you made plans for training everyone on how to use the new fund accounting system?

Training, it seems, is often an afterthought when it comes to new software launches. Managers, IT staff, and everyone involved with selecting, implementing and using the new software should be involved in the training. Here’s how you can learn from adult educators on the best ways of engaging users in your new fund accounting system.

#1: Sell the value.

Even before you invite the team to a training meeting, you need to ‘sell’ them the value of the new software. Unlike children, who learn out of curiosity or obedience to authority, adults learn best when they perceive the personal value of anything they are expected to learn.

The staff of your organization must know right from the start why you’ve chosen the new software and why this particular product from among many fund accounting systems. How will it help them with their daily work? Will it solve problems, increase productivity, work smarter or faster than what they’ve used before? It’s only by answering these questions upfront will you grab their attention for further training.

#2: Keep training sessions focused on what users need to know.

Users need to know precise information to help them do their jobs well. They don’t need to know the history of the product, or the bells and whistles that so excited your CEO. They want to know now how to use it to do their jobs better. Focus your training on immediate activities the group can do to use the new software.

#3: Use it or lose it.

Another truism with adult learners is that they must use their newfound knowledge immediately or else it is forgotten. Adults need to use new skills repeatedly in order to keep them fresh. Schedule training sessions with the new fund accounting system where users actually bring in their projects and work so that the training can focus on job-related skills, and users can ask questions while actually using the system for real work.

#4: Customize vendor trainings.

Vendor trainings can be a great asset, but you may need to customize a vendor training session to your organization’s needs. You know your team. They may respond best to written materials, hands-on demonstrations, or simple verbal instructions. Work with your software vendor to tailor training needs to your team.

#5: Schedule follow up.

Many training programs fail because trainers pour information out and then leave without follow-up. Users leave the session invigorated and excited, but stumble using the new system when they return to their workplace. To keep the momentum going after training, schedule follow-up meetings a week or two after the initial training. Invite users to bring questions to the meeting so that you can help them use the system to its fullest.

Ready for New Fund Accounting Systems?

At Beck & Company, we understand the unique needs of the nonprofit sector. Our CPAs and consultants have been assisting nonprofits since 1987 with their accounting and operational needs. If it’s time to implement a new fund accounting system, please contact us for assistance. Call 1-703-834-0776.