Nonprofit – Page 4 – Beck & Company

Leveraging Technological Opportunity as a Nonprofit

There is an ongoing struggle in our world to prioritize. So many factors demand our attention and focus that it can be overwhelming and challenging to know where to put our focus, what can wait, and what is worth consideration or not. This is true just as much in our work lives as in our personal lives, and nonprofits are not exempt from this either.

With a continuous stream of challenges facing nonprofits, your organization must address, face, and find solutions to such challenges that include, but are not limited to, financial, environmental, and demographic constraints. Maximizing potential with financial constraints considering all of the factors involved can be daunting. Getting the desired performance out of your nonprofit is not easy, but it is possible. One such performance indicator that we looked at last week is transformation. Being open to change, embracing and allowing it, and carefully using finances to help is important to nonprofit success. Let’s take a look at the second performance indicator, technology, this week that is a huge part of assisting in an organization’s transformation.

Beck and Company’s Certified Public Accountants and Business Advisors know that managing all aspects of a nonprofit is a huge task. Because it is impossible to be an expert in all realms at once, we are here to help with the financial and accounting piece in addition to the technological piece of your organization that might merit outside help. We are passionate about helping nonprofit organizations to be successful and would be happy to assist in the areas of our expertise so you can focus on your areas of expertise. Learn more about our nonprofit financial service offerings here. In addition, learn more about the technology consulting service offerings we provide that will help with keeping your financial and business processes in order.

Opportunity Awaits: Leveraging Technology to Enhance your Nonprofit Organization’s Success

There is no denying that technology in today’s world is a necessity. Keeping up with technology translates into keeping up as an organization overall. Technology is critical, but nonprofits often fail to leverage the opportunities it provides. Often times even the true need for technology can be overlooked by nonprofits or justified as not necessary due to financial constraints or lack of buy in from stakeholders. Unfortunately, this may seem okay for organizations to limit their technology use or not stay up-to-date, but this will ultimately be costly.

Part of the transformation and constant development your organization needs is an ongoing process of enhancing technological processes that can automate processes, help with managing data, and create more efficiency at your nonprofit. Making the right investment choices in technology that will support your organization’s efforts and enable further transformation is key in this area. From a financial perspective, this involves gathering and providing the right information that will be used by nonprofit stakeholders to support investment decisions and calculate cost and value benefits. This includes acting on the information and research of technology options and using this data to make decisions with regards to technological advancements that will truly benefit the organization. Then, successful and methodical implementation of the decided upon technologies is important.

What forms of technology are especially worth consideration in our current, modern age?

Social technology
Mobile technology
Analytics technology
Accounting and financial system technology
Cloud technology

Knowing which technology options to invest in that will result in the best return on investment and knowing how to execute a strategy to roll out new systems can be challenging. It is important to prioritize what is needed and what will be most beneficial, understand costs and outcomes, and communicate clearly to stakeholders as to what decisions are being made and how users will be assisted in the implementation process.

Contact us to learn more about our technology consultation services to help you in the process of finding and implementing the best technology solutions that will further transform and assist your nonprofit organization in its success. Be sure to read next week’s blog as we look at yet another key performance indicator for your organization—transparency.

Embracing the Need for Ongoing Transformation as a Nonprofit

Nonprofit organizations are encountering new complications and intricacies all the time, and monitoring performance, success, and failure is more important than ever to ensure that your organization has what it takes to not just survive but thrive. Being successful and thriving as an organization requires planning, executing those plans in a methodical way, monitoring activities, and analyzing the results of those carefully thought out plans. The overall performance of your nonprofit is essential to its current and future success.

In addition to this performance piece, strong financial practices are also needed. Beck and Company’s Certified Public Accountants and Business Advisors know that doing all of this is no easy task. That is why we are here to help your organization with the financial end of being a nonprofit so you can focus on carrying out plans and acting on your organization’s mission. Contact our CPAs today to get the nonprofit accounting and controllership services you need to further your mission from a financial perspective. By allowing us to take care of some of the financial pieces, you can focus on your organization’s ongoing performance. In focusing on performance, we will take a closer look at performance indicators over the course of this month and will discuss what they mean for your organization. The “4 Ts” are four performance indicators that deserve strong consideration and ongoing analysis, not to mention action, too. The first of those four indicators is transformation.

Transformation: Adapting and Changing as a Nonprofit is Essential

It is hard to deny that businesses and organizations alike are always in the process of change. But, do you view the ongoing transformation of your organization as something that adds value to it? Or worse, do you not allow your organization to transform while forcing it to stay as it has always been? Do you see that there are benefits to transformation including financial benefits? There is value to transformation, and transformation is all about effectively managing changes made to the organization or services delivered by it.

Transformation must be viewed as an ongoing activity rather than a single event. An effective performance management system will aid in this process, bringing a clear, consistent, and constant focus on organizational strategy, planning, execution, and review. Being onboard with allowing your organization to transform with the times and helping it along in this process are not easy, and it can be challenging to see the financial benefits—at least initially.

Here are five challenges your organization will likely face in the process of transformation. Recognizing these but not letting them stop your organization from making changes is key.

Challenges associated with organizational transformation:

1. Getting people to adapt to changes

2. Securing the necessary budget to support transformation and make the needed changes

3. Determining the cost benefit of making the changes

4. Finding the right skills and people to help in the transformation

5. Making the decisions in knowing where, exactly, to put the focus in the process of transformation

Transformation requires supporting significant change in approach to your organization’s operations, technology, processes, and service delivery wherever and however it may be needed in order to improve efficiency and deliver better outcomes. Beck and Company CPAs can help you help your organization in this process by sorting through and identifying the right financial information you will need to provide to stakeholders within the organization. This financial data will support decisions around the delivery of services and will provide all involved with the best access to the relevant financial information needed to make the needed changes.

Being open to transformation and being well prepared for it with the financial data you need are great places to start in truly responding to needs and making ongoing changes as an organization. Please contact us to learn more about how we can assist you in this process of continual improvement through organizational transformation. Stay tuned next week as we take a look at another performance indicator worth consideration—technology—that is closely tied to transformation.

Form 990: What Nonprofit Key Constituents Need to Know

As a key constituent at your nonprofit, protecting yourself and your organization is no easy task, and inaccurate tax preparation and filings on forms such as the Form 990 are one way that your organization can easily be in trouble. The good news is that you don’t have to figure it all out alone. Beck and Company’s Certified Public Accountants and Business Advisors are trained in these areas and are here to help. Our tax services are designed to help you file all of your nonprofit-related forms with peace of mind.

Last week, we took a look at how Form 990s are often misunderstood or not sufficiently understood, what risks these misunderstandings could create, the importance of seeking professional help in filing Form 990s, and what Form 990s include. To learn more about the Form 990 and what you need to know on general terms, visit here.

By now, it should be clear that protecting yourself and others from penalties is important, but how do you ensure that this happens (in addition to the help you receive from a professional CPA)? How do you actually know what must be filed on Form 990 returns? The following information will help you to be informed when it comes to filing Form 990s and all of their nuances. The questions below are meant to assist you with any future tax compliance filings and the process of informing and education boards and management teams alike. All key constituents (officers, directors, trustees, key employees, management, presidents, board members, etc.) should be sufficiently informed to be able to answer these questions.

Do all members of the governing body of your organization have a complete copy of the Form 990 that is supplied prior to filing?
Did your organization become aware of or engage in any excess benefit transactions in the past tax year?
Did your organization have any receivables from or payables to key constituents recorded on its financial statements?
Was any grant or assistance given to any of these key constituents or their families by the organization?
Was your organization a party to a business transaction with any of these current or past key constituents, employees, or their family members?
Do any donor-advised funds, where the right to advice on distribution or use of funds/accounts was granted, exist?
Did your organization hold assets in endowments of any kind?
Has your organization had any international financial accounts?
Did any key constituent have a relationship (familial or business) with any other key constituent?
Have substantial and significant changes been made during the tax year to governing documents?
Is a written conflict of interest policy in place that requires annual interest disclosure that could give rise to conflicts? If so, was this monitored and enforced regularly and with compliance?
Does your organization have written policies for: whistleblowing, document retention, and document destruction?
Does compensation determination follow a review and approval procedure with sufficient data and deliberation before a decision is reached? (A review of Form 990, Part VII is highly recommended.)
Does your organization have an audit, review, and compilation committee responsible for oversight of financial statements and independent accountant selection?
Is a gift acceptance policy used for non-standard contributions?

If key constituents can answer these questions, they will be on the right track to completing the Form 990 or reviewing it with sufficient information to avoid penalties and give accurate reporting information. With some education, information, and review, you can save your organization from lots of headaches and potential disaster in the eyes of the public, press, and IRS. Don’t leave your key constituents uninformed.

Beck and Company CPAs would like to assist any key constituent with filing the Form 990. Contact us to get the nonprofit tax assistance you need to be successful at tax time.

Form 990: An Overview for Nonprofits

With tax time looming, tax forms and reporting are likely on your mind to some extent by now and will become even more prevalent in the next few weeks and months. Tax reporting issues can be costly in many ways, both financially and to the future health or even existence of tax-exempt and nonprofit organizations. Over the years, Beck and Company’s Certified Public Accountants and Business Advisors have seen that many nonprofits and their boards are not as aware as they should be of what data and information is expected to be reported and needs to be reported on Form 990 returns. Without proper understanding of this information, there is also a risk of not being aware of the penalties that are possible to incur if these Form 990 forms are filed late, are inaccurate, or are left incomplete.

As a member of the board of directors, a trustee, or a staff member of a nonprofit, it is your duty and responsibility to review the Form 990 sufficiently to help protect both yourself and your organization from penalties. Although not an IRS requirement, it is certainly a best practice and strongly encouraged that boards review Form 990 information. By submitting proper information in a timely manner, you offer three forms of protection. You protect your organization from losing its exempt status. You also protect the organization from incurring potential financial penalties. Finally, you protect board members from the possibility of owing money personally from personal penalties.

Beck and Company’s Certified Public Accountants and Business Advisors understand that these forms are confusing, complicated, and overwhelming. Not only that, but it is difficult for those of you working at nonprofit organizations, who should be focused on the important work and mission of the organization, to truly understand them and what is expected on them. The intricacies necessitate trained professionals who are well versed in the forms and understand the legalities and complexities well. As you can see, inaccuracies can be costly to your organization’s future, but you don’t have to worry about those if you solicit the help of a professional tax advisor. Learn more about Beck and Company CPA’s tax services and the ways we can help you so your tax preparation and filing are done correctly.

Now that you understand that Form 990s and other tax forms are often misunderstood or not understood by boards and nonprofit staff members, that there are risks to inaccurately filing Form 990s but also ways to protect yourself, and that a professional tax advisor or Certified Public Accountant (CPA) is likely a necessity in helping taxes get filed properly, let’s take a quick look at a general overview of Form 990 including what it is, when it needs to be filed, and what is included on the form.

What is the Form 990?

The IRS Form 990, officially referred to as the “Return of Organization Exempt from Income Tax,” is the tax document that tax-exempt, nonprofit organizations file each year with the IRS. The Form 990 allows the IRS and the public to evaluate nonprofits and how they operate.

The Form 990 requires disclosure of potential conflicts of interest, compensation of board members and staff, and other details having to do with financial accountability and avoidance of fraud.

When do you file the Form 990?

Your filing depends on your fiscal year end date. You are required to file by the 15^th day of the 5^th month after your fiscal year period ends.

What information is required on the Form 990?

Besides general contact information, the form includes a Statement of Program Service Accomplishments, a Checklist of Required Schedules, Statements regarding other IRS Filings and Tax Compliance, Governance, Management, and Disclosure information, Compensation figures, a Statement of Revenue, a Statement of Functional Expenses, a Balance sheet, Reconciliation of Net Assets, Financial Statements and Reporting.

Next week, we will take a closer look at what key constituents truly need to understand and know about Form 990 information that is filed so they can differentiate that from what they can leave to the professionals. Beck and Company CPAs would like to assist you and your organization in filling out the Form 990. Contact our CPAs today to get the nonprofit tax assistance you need.

Improving your Non-profit’s Public Perception and Transparency

Generally, transparency is considered as something required of entities that are asking for something whether it be politicians seeking votes, companies seeking to build new plants, or non-profit organizations seeking money. Donor transparency can be a useful means of fundraising for these organizations. On the other hand, a lack of transparency can be extremely costly because donors can choose to give their money elsewhere to organizations that are being more transparent. The public is desirous to engage in and give to causes they care about, but this only happens if your organization’s perception is positive and there is honest transparency. This honest transparency works both ways by allowing the potential donor to be transparent and by responding back honestly and transparently as an organization. Beck and Company Certified Public Accountants and Business Advisors offer many non-profit financial and accounting services to assist you in being truly transparent when it comes to your finances.

Donor Transparency

The process of receiving financial support for your non-profit begins by allowing potential donors the freedom to be transparent themselves. Donor transparency means supporters talking candidly about their reasons for considering giving.

This includes:

How important is it for a donor to get personal, public recognition for their generosity? It could be extremely important or something to avoid at all costs.
Whose approval is necessary before a sizable contributions can be made?
The deeply personal motivation behind a gift – which is different for everyone.
The kind of connection the donor wants to have with the organization. Some people want to be consulted regularly; others want anything but that.
The larger role played by the charity in the donor’s life. Many people become philanthropists because of a life-changing experience.
The worries the donor might have about giving. Many donors have concerns about spending, competence, or realistic chances for success, but they are often reluctant to voice them.

Financial Transparency as an Organization

The final point above is extremely important for your non-profit to address with donors. Financial transparency starts with effective and accurate financial reporting. Visit here to find out more about important tips for maintaining financial accountability in your reporting. These include tracking that raised funds were only used for their intended purpose, communicating openly in both good and hard times, maintaining practices that won’t hinder future networking opportunities, and having an infrastructure in place to manage finances well. If potential donors worry that the organization’s spending or financial competence is not up to par, this can be costly in losing the potential donation or future donations from current donors. On the contrary, having updated and accurate financial statements while being honest and open about common practices your organization follows can create needed trust.

When it comes down to it, transparency means trust. Your organization must be financially in good standing with sound business and finance practices in place to be able to secure donations and continue receiving more. Tell the truth to donors and potential donors about your organization, your partnerships, and your goals. Disclose who benefits from your services, how much they receive, and how and when funds are both raised and then disbursed.

In conclusion, no partnership between donors and non-profits can truly get off the ground until both sides have put all of their cards on the table in an honest manner. Donors need to state clearly what they can provide to the campaign and express concerns openly. Organizations need to prove what will be done and gained through these donor provisions. Transparency and positive perceptions will surely strengthen partnerships and cultivate needed trust. Transparency leading to partnerships can only be possible with sound non-profit practices. Please contact Beck and Company CPAs for assistance in making this a reality for your organization.

Tips for a Successful Non-profit Financial Audit

Nonprofit organizations undergo financial audits for a variety of reasons. In addition to being in compliance with various covenant and membership requirements, audits also provide an organization with tools that can help with best practices and offer accountability to the institution. Just like the notion of having surgery, the idea of undergoing a financial audit can be less than appealing. At the same time, it is important to focus on the significant value that results. Here at Beck and Company’s Certified Public Accountants and Business Advisors, we can help you properly prepare for an audit and make the process less painful and more beneficial. We offer an array of auditing services to assist you.

How can your nonprofit prepare for, manage, and benefit from a financial audit? The following tips offer suggestions to do just that.

1. Before the Audit- The Pre-Op:

Advanced preparation for your audit is essential. Your team should create and use a list of items that will need to be prepared before the auditor arrives. Having all of the necessary documentation ready for the auditor saves time and money in addition to resulting in less staff distractions during the actual audit process. Through many years of auditing and assisting nonprofits with this process here at Beck and Company CPAs, we have compiled a list of task items designed to help you successfully prepare for an upcoming financial audit. You can access it here. Remember that auditors are likely to request additional reports and information based on what is initially supplied. These requested reports should be added to the preparation list for the following year.

Choosing the right professional who will work with your company is extremely important. Just like choosing a competent surgeon that specializes in what needs to be operated on, you’ll want to choose an auditor that you feel comfortable with and who is experienced at working with not-for-profit organizations. Think of your choice in auditor as a partner not a distant professional.

In the preparation process, be clear about deadlines. The time frames for your audit are crucial. If bank submission, board meeting, audit committee session, or grant deadlines need to be met, be sure to communicate these to all teams involved and do this early on in the process. Clear communication eliminates surprises and delays.

2. During the Audit- The Surgery:

Similar to the notion of having surgery without the surgeon present, the greatest efficiency and most useful results come from maximizing your time with the auditor. Be sure to get as much done and as many questions answered while the auditor is onsite. If there are any open items that cannot be accomplished, set completion deadlines before the auditor leaves.

3. After the Audit- The Post-Op:

The most significant aspect of an audit is what results from it just as the results of surgery are why you had it in the first place. Without following recovery and therapy instructions, a successful operation still will not produce the intended outcome. Similarly, an audit will not be beneficial to your organization without implementing changes and using suggestions to make improvements. The most valuable part of an audit is often the management comment letter. It should highlight areas of control deficiency, concerns, and needed improvements. The implementation of changes, as appropriate, are the central benefit that an audit affords your organization. In addition, the results can help make future audits even smoother in the upcoming years.

Beck and Company CPAs have helped many nonprofits prepare for annual financial audits and would be happy to assist you as well. Please contact us and request a complimentary audit services consultation by visiting our website.