There are more than 1.5 million nonprofit organizations currently registered globally. Part of what helps a nonprofit organization continue to run is the organization’s financial department. These strategies are for tracking and managing everything on the financial side of things.

If you’re beginning a nonprofit or are looking for ways to improve in the financial department you’re in the right place.

We’re going to share some nonprofit accounting software mistakes that are made and ways that you can avoid them. Avoiding these mistakes now will save you from the challenges that these mistakes cause in the future.

1. Not Spending Enough or Spending Too Much

Accounting software is used in nonprofits to help make the accounting and bookkeeping process much easier. Instead of relying on your staff to handle the books, the software will keep everything organized.

It will also help with keeping records more accurate and make the process of data transfer quick.

The first mistake you’re going to want to avoid is over or under-spending. This happens when you’re purchasing the software that your nonprofit organization will use. Those that don’t want to spend a ton of money might opt for a basic form of software.

Software that doesn’t include all the add-ins needed to run the accounting side of things.

Whereas, those that spend too much get caught up in all the features offered. They pay for them all regardless of the notion that the extra features won’t be used.

To avoid making this mistake, we recommend assessing the needs of your organization before purchasing software.

Once you’ve made this assessment, you can then move forward with finding software that will meet and exceed these needs. Also, keep in mind the availability of the tech support offered by the software company you’ll use.

If something occurs, you don’t want to get stuck waiting for days for a response from customer service before the issue is resolved.

2. Buying Software Because You Have to

Have you ever purchased something because you needed it, but don’t consider things like:

• How it works

• What is included in the purchase

• The overall cost of the goods or service

Some nonprofit organizations, only understand that they require some accounting software, and they grab the first thing they see. This isn’t right for several reasons, including not having software that will support things like required reports that must be kept and so on.

The best way to avoid making this mistake is to consider your options carefully. Ensure that you’ve checked that your specific industry doesn’t need a particular type of software before making your final purchases.

If the software you’re thinking about buying doesn’t include the solutions needed to solve your accounting and bookkeeping issues, it’s best to continue your search. After you’ve compiled a list of possible software’s that you’re going to use keep narrowing the list.

3. Not Getting Help

Most of the decisions made for a nonprofit will be made by the staff internally, which also includes volunteer staff. While this might save money, it doesn’t leave you choosing the best option possible.

Someone else should be involved in deciding the accounting software that you’ll be using, and that person is your accountant. After all, they are the ones responsible for keeping the finances and fundraising of your organization in order.

Your accountant can help you do several things before choosing the right type of software, including:

• Decide on a budget for the software

• Assess nonprofit accounting needs

• Decide if you need to upgrade your software or find a different one

Not only will your accountant help with the things that we’ve mentioned above, but they will also help you put the software to work. This is useful when it’s time to implement it throughout the nonprofit.

4. Poor Integration Model

Although technology has evolved, some companies still have people manually entering data into the software application. While this isn’t a horrible idea, it’s time-consuming, and there is room for effort.

If you’re looking to streamline your accounting process, you need to find software that allows for seamless integration. This means that no matter where in the office a staff member is, financial information can be uploaded to the software with ease.

A good system should also be easy to access, even if you’re accessing the software from a mobile device. Keep in mind everyone in your organization doesn’t need access to the accounting software if it’s not necessary.

5. Not Upgrading on Time

Whenever you use software or other services, you’ll receive a notification when it’s time to upgrade your system. Often people ignore these notifications and don’t upgrade because they assume they don’t need them.

You don’t want to make this mistake because not upgrading can leave holes in your system and cause issues with overall accounting systems. If you’re using outside services, they can remind you when it’s time to upgrade your system or automatically upgrade the system for you.

Nonprofit Accounting Software: Mistakes to Avoid

When it comes to nonprofit accounting software, there is no doubt that your organization needs it to continue thriving. We’ve listed the most common mistakes that organizations make in the software department.

As well as ways that these mistakes can be avoided.

If you need help with the software, your nonprofit uses, request a meeting with The Charity CFO. We know that part of the battle for most nonprofits is in the accounting department and want to give you some peace of mind when it comes to the organization’s finances.

The times we live in are difficult. Today we have COVID-19, natural disasters, and weather anomalies.

Disaster relief grants help businesses of all kinds survive in our turbulent times. Non-profits are particularly vulnerable because their operating funds come from donations.

During periods of hardship, gifts tend to disappear as donors struggle to pay bills. They’re far less likely to give to community causes when their own survival is in jeopardy.

If you run a non-profit and would like to benefit from available grants, this article is for you. Here’s an overview of some of the emergency grants that you could apply for.

How Nonprofits Qualify for Disaster Relief Funds

Non-profits looking for relief can apply for grants based on hardship status. Hardship status means they can prove they’ve experienced financial loss directly caused by disturbing current events.

The process involves contacting the grant-giving foundation and making inquiries about how to apply. There are as many different requirements as there are grant-giving sources, so you will have to find out the specifics.

Having to do a lot of paperwork is normal, but most foundations genuinely want to help and try to make the process as user-friendly as they can. Getting a grant for your non-profit can help you keep the books balanced and help your business survive until things get better.

1. Bill and Melinda Gates Foundation

One of the most well-known worldwide sources of disaster relief funding is the Bill and Melinda Gates Foundation. They specialize in helping in instances of acute emergencies. As a non-profit, you can apply on their website by filling out a Request for Proposals form.

Although the famous couple has experienced recent marital difficulties, they have promised to keep their foundation work going strong.

2. Actors Fund Entertainment Assistance Program

This grant is for actors who struggle with a loss of work. Because actors work intermittently anyway, a natural or health disaster like COVID-19 can make surviving almost impossible. This grant can help struggling actors with things like rent, food, and basic bills.

3. Artist Relief Project

The Artist Relief Project helps artists who have been negatively impacted by COVID-19 shutdowns.

Nonprofit organizations pool funds from the community and reserve them for helping people when times get tough. Artists are especially vulnerable to periods of economic disaster because they often freelance and don’t have luxuries like health insurance.

When a pandemic like COVID-19 strikes, artists are especially vulnerable because their work is often thought to be “non-essential”. This means their sales may drop as their customers lose their own abilities to buy anything beyond basic necessities. If they teach art, as many artists do, they also lose money because of class cancellations.

4. Musicians Foundation

This grant helps musicians with medical and dental issues, as well as a variety of personal crises. It is also available in the event of natural disasters and other emergencies. Like visual artists, musicians are especially vulnerable during pandemics. They can’t travel and do in-person events like concerts, which may provide most of their income under normal circumstances.

5. Pfund Foundation

This grant helps people deal with the effects of COVID-19. It is especially geared toward members of the LGBTQ+ community and addressing their needs during the pandemic.

6. Emergency Business Grants from Government and Other Sources

If you’re looking for a nonprofit guide to disaster relief, start searching online. You’ll find a plethora of interesting resources for non-profits experiencing hard times.

The SBA or Small Business Administration is a great place to find emergency business grants for companies of all sizes. You can also check with your state and federal representatives for information about available emergency money.

7. Open Road Alliance

The Open Road Alliance provides $50,000 to non-profits that have to reschedule their fundraiser events because of COVID-19. It is a low-interest loan that can be used for anything related to fundraising losses.

Since most non-profits survive because of donations, having access to this type of assistance is a lifesaver. Without fundraisers to bring in the donations, some non-profits may lose over 50% of their standard operating budgets.

8. Hello Alice

This foundation helps members of the African American community in emergency situations. They distribute $10,000 grants and also keep a database of other resources that members can rely on.

9. Professional Beauty Association

The Professional Beauty Association offers a disaster relief grant of $500. It’s designed to help licensed beauticians and hairstylists survive emergency situations. They also extend some organizational benefits to other salon employees.

COVID-19 hit salons especially hard. Many people were rightfully afraid to go out during the pandemic, and getting their hair worked on lost its appeal. Salons closed, and many hairstylists were laid off. This is just one example of why this grant is such a great resource.

10. Small Business Grants from Facebook

Most non-profits rely heavily on Facebook and other social media platforms to keep their communities informed and engaged, and to raise money.

Facebook provides a certain yearly amount of grant money to small businesses. They focus on helping companies that use Facebook for their marketing.

It’s not uncommon for them to receive many more applicants than they can possibly help, so apply early each year.

Find Disaster Relief Grants for Your Organization

So now you’ve seen several examples of disaster relief grants. They’re all available to non-profits and individuals in times of disaster. If you run a non-profit it pays to know about these different options. This way you can better run your organization and reach out to individuals in your community.

We help non-profits manage their accounting activities and specialize in handling all the different kinds of financial issues they face. If you’d like to find out more about financial resources for non-profits, schedule a free consultation with us today!

Were you aware that nonprofit financing is as simple as reaching out to various sources?

Nonprofit finance is something that many struggle with, especially small organizations. While many nonprofits start strong, the smaller ones often run out of funds after exhausting their initial source.

This can discourage people from starting nonprofits, but fret not. Fortunately, there are no nonprofit rules of finance. Here at The Charity CFO, we can provide all the info you need to get through nonprofit finance challenges as quickly as possible.

Read on to learn about 7 nonprofit finance solutions to consider!

1. Institutional Donations

When facing nonprofit finance challenges, one of the quickest ways to get funds is to encourage institutional donations. This is a common route that nonprofit organizations take as it involves getting funds from organizations.

Institutional donations are often given by those that believe in the cause of a nonprofit. Some of the most popular are the likes of the Ford Foundation and the Gates Foundation.

No matter which organization provides your nonprofit funds, you can expect them to work alongside you throughout many processes. Whether you need help setting up an event or would like to start a fundraiser, the organization will provide everything they can to ensure things go smoothly.

2. Private Donations

Private donations are similar to institutional donations, but they come from individuals. However, large organizations can also be considered private donors.

Learning how to manage finances as a nonprofit often starts with receiving private donations from those in your local community. Anyone that participates in your nonprofit can donate and help with things like an organization would.

As your nonprofit grows, you’ll likely receive private donations from more people in other areas. While you’ll often receive smaller donations, you’ll get a plethora of them to help you sustain the nonprofit.

The more donations you get from private donations, the harder it can be to handle taxes. However, you can check out our services to prepare for taxes so that you can continue receiving donations without any problems.

3. Government Grants

One of the top financial challenges of nonprofits is trying to sustain themselves even after receiving donations. When this happens, it’s best to reach out to the government for assistance.

Many governments offer a variety of grants to nonprofits if they comply with a set of guidelines. If you visit the US government’s website for grants, you can learn more about which grants your nonprofit may be eligible for.

4. Internal Contributions

After getting donations and grants, the next thing you can do is start asking for internal contributions. These contributions come from the board members that are responsible for decision-making in the nonprofit.

Internal contributions are often asked when a nonprofit has exhausted its main resources and is left with few options. However, they’re usually not necessary if you seek other financial solutions.

When seeking internal contributions, it’s best to continue seeking funds from other sources. The more money you can get, the easier it’ll be to manage everything in the long run while avoiding internal contributions.

5. Advertising Campaigns

Many people have the misconception that advertising costs money. While it typically does, you can launch advertising campaigns to raise funds that don’t cost much.

Some of the most cost-effective ways to advertise can be done with posters, billboards, and clothing. All you must do is create a budget and decide how much you’d like to invest in each.

Social media is another great way to advertise as over 4.33 billion people actively use it.

What makes social media cost-effective are the tools that the platforms provide. When using sites like Facebook or Twitter, you can choose who you want to see the ads with filters for age range, gender, location, and more.

6. Sponsorships

Similar to launching ad campaigns, you can get sponsorships from other businesses to help your business raise funds. In many cases, sponsors will pay for advertisements, events, and more things that help you gain visibility.

When it comes to nonprofit finances, it’s best to get as many sponsorships as possible because they’re stable revenue streams. The only thing your nonprofit will need to do is include their branding whenever you host events or launch ads.

Acquiring sponsorship deals can be done by reaching out directly to businesses or having them come to you. If you have a smaller nonprofit, you should contact local companies to help you. As your organization grows, you’ll attract the attention of larger companies.

7. Events

The last thing you can do to overcome the top financial challenges of nonprofits is host events. The best part about doing so is that the type of nonprofit you have doesn’t matter.

You can do things like host movie nights, races, parties, and more while charging people to enter. This provides value to those that are contributing so your nonprofit will have a better chance of raising funds.

The larger your nonprofit is, the larger events you can host. However, you shouldn’t have a problem coming up with ideas if your nonprofit is small. You’ll just need to focus on your local community.

Start Using These Nonprofit Finance Solutions Now

After reading this article, you now know about several finance solutions that can immediately help you turn things around. We encourage you to start by thinking about events you can host to give back to the community. While doing this, you can ask for donations from institutions and private donors to help fund things.

Keep in mind that it’s best to acquire funds from multiple sources, so don’t rely on one source to keep your nonprofit afloat.

Request a meeting with us today to learn about how we can help you overcome nonprofit finance challenges!