posted September 13, 2016

Choosing a new Accounting System

by Casey R. Good, CPA, Audit Manager

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Is your organization growing? Are you thinking of implementing a new accounting system? Of the 1.6 million registered nonprofits in the US, a sizeable percentage are still running their organizations on simple spreadsheet programs. While using spreadsheet programs may have been cost effective in the past, there are many useful tools available to nonprofit organizations that help with a host of items, from tracking donor information, membership details, and grant information to integrated packages for general business operations. Below you will find four important considerations when purchasing a new accounting system.

Accounting capabilities - Does the system need to be modular in nature to support a growing structure or uncertain future? Can it support multiple operating segments for larger organizations? Can information be exported to Excel or other spreadsheet programs? Can reports be exported as PDFs? Can information from other applications be imported into the system? Electronic features in today’s world are imperative, especially if you need an e-commerce function to accept donations, interface with vendors, and provide remote access for employees that telecommute.

Management Features– Does the system have management tools, such as financial dashboards, security features (both in-house and for donor/vendor information), financial statement reporting, budgeting capability and analysis tools? Depending on the complexity of your organization, these may be critical tools or expensive and unnecessary features.

Primary funding source– If your organization is driven by grant funding, you need a system capable of grants management and compliance. However, if you are primarily donor funded, the organization is better off choosing a system that has donor management systems for tracking gifts and their restrictions.

Help/Support– Are tools available to make the transition from your existing system as easy as possible? Does the company provide dedicated support, or training as part of the purchase? Are there videos, webinars, or instructional tools available to review? Vendor support makes a difference in the amount of downtime it takes to get a new system running properly.

It's important to remember that many other factors play a role when determining what software is best for your organization. These factors include ease of use, final costs, and the ability to add/upgrade the system when necessary. For a detailed review of individual accounting system options, see the 2016 Review of Nonprofit AccountingSoftware Systems at cpapracticeadvisor.com.


The content of these pages is for general information purposes only and does not constitute advice. Heinfeld, Meech & Co., P.C. tries to provide content that is true and accurate as of the date of writing; however, we give no assurance or warranty regarding the accuracy, timeliness, or applicability of any of the contents.