All of this red tape is enough to drain the life out of mere mortals. But executive directors have the fire of their passion to keep them going. They want to make a difference, not spend all of their time worrying about accounting and record keeping. They need information at their fingertips and expect their accounting software to provide the flexibility and transparency of cellophane. Let’s take a look at how software applications in this space are helping these organizations achieve their service objectives.
What an executive director wants: Directors need a system that offers the right balance between access and control. One director might need access to critical metrics like cash flow, pledges outstanding and percentage of administrative costs. Another might need to satisfy reporting requirements of multiple grantors, who are themselves subject to different levels of oversight. Other executives will be looking for automated control over organizational receipts and disbursements. One director might need to manage across locations and in different currencies, while one needs to manage across multiple projects and across numerous funds. No matter what information they are monitoring, they expect it to be served up in a system that is easy to learn and easy to access.
Flexibility enables a nonprofit to respond to the needs of their many stakeholders. Organizational stakeholders might include individual donors, constituents or grantor organizations. They could include governmental agencies, private foundations or trust funds. If you are receiving a government grant to provide low cost housing, you have to be able to account for each dollar that goes into every nail that finds its way into that house. And you have to be able to match that government agency’s chart of accounts when you file your report. Each donor might provide restricted or unrestricted funds and will want to see detailed comparisons of budgeted activities versus actual expenditures by fund. Your chart of accounts and reporting solutions will have to offer more ways to slice and dice your data than a veg-o-matic.
Donors expect a transparent trail from their money to the constituents served. It’s not enough for these organizations to provide services to the many. They have to show the results of every dollar spent and be able to trace each donor’s contribution to an impact on the cause. If you’re an animal shelter, you want to be able to show how much of a given contribution is going to feed Fido versus how much is being spent to keep the electricity running in the accounting office. If I am an individual donor, I want to know that my five dollars has gone to the cause I specified; not to paying the salaries of an administrator (although how I can expect an organization to serve a cause without a team of qualified people is part of the difficult irony of working in this space.)
Let’s take a look (in alphabetical order) at the leading not-for-Profit applications to see how they help organizations go from cause to effect.
• Cougar Mountain Software
• Sage MIP
• Serenic Navigator
(877) 872-2228 x21
Price: Standard Edition, $2,955 standalone (single user); $4,195 server-based (single user); $5,395 (two concurrent users); $6,495 (three concurrent users). Professional Edition, $6,595 server-based (single user); $7,795 (two concurrent users); $8,995 (three concurrent users)
Co-founder Peter Stam was kind enough to enlighten me about this solution which offers an affordable option to nonprofits looking for ease of use and flexibility. AccuFund's sweet spot is organizations in the
$3-million-to-$4-million-dollar range and it has a good bit of traction in organizations focused on community action (not to be confused with those community organizers we heard so much about during the elections), job training and economic development. The company must also have a flair for the dramatic, as the product is very successful among theater groups in need of weekly reporting.
When it comes to executive directors, or apparently even set directors (in those theater groups), the product delivers critical information in a couple of different ways. It provides a myriad of financial reports via an integrated report writer, while using a row-and-column approach to simplify the report design process. The application also offers several distribution options from any query-based screen, including exports to Excel, HTML and PDF formats. To address what seems to be a common problem among nonprofits, AccuFund offers a view-only license that allows directors to view but not modify information in the system. Apparently, no one trusts an executive director to make journal entries.
Flexibility is provided by a number of options in setting up the General Ledger account structure. The system can be set up to use a linear approach that includes segment information in a single string or using a table structure that treats each element separately. The account number string can hold up to 255 characters and up to 99 elements. (I do not want to be the person responsible for entering invoices in the organization that takes advantage of all 255 characters to record a transaction.)
When it comes to tracing expenditures from funding to the service activity, reports and online queries allow managers to compare budgets with actual expenditures by account number. In addition, the general ledger accepts statistical amounts via demographic fields to track and quantify results. AccuFund also offers some unique modules including loan tracking, endowment allocation and reporting, and custodial checking.
AccuFund offers a streamlined solution with a straightforward interface that can be configured to meet the specific user requirements of a Non Profit organization.
The Financial Edge
Pricie: Bundle of six essential accounting modules starting at $2,995 for single user, $6,995 for multi-user. Subscription pricing starting at $5,500 per year for single user and $8,000 for multi-user (includes customer support/upgrades, three-year agreement entitles buyer to free basic implementation of six core modules).
The Financial Edge
Blackbaud has been serving the needs of nonprofit organizations for more than 27 years. Their recent acquisition of Kintera in June of 2008 helped to put the final nail in the coffin of former industry leader FundWare while giving Blackbaud a full suite of tools to use in service to more than 22,000 organizations. Widely known for having a top-of-the-line system, the recent offering, Blackbaud for Small Offices, helps smaller organizations access their solution thanks to flexible pricing and options for deployment that scale from one to three users.
Executive directors can get all of the information they need from an interactive, visual dashboard that can be customized to meet their specific requirements. The Financial Edge dashboard links to underlying details via hyperlinks. Like AccuFund, this product offers a view-only user license that keeps that director from messing up the underlying accounting, although directors can modify the dashboard to their hearts content but they can't generate new transactions. Directors can also easily dump information into Excel for further analysis and spreadsheet wizardry. In addition to the dashboard, the application provides more than 100 preformatted reports, query tools and a Visual Chart Organizer.
The system offers flexible coding thanks to a hybrid account-numbering scheme that supports up to 10 segments and 30 characters. Users can also track projects and up to five additional user-defined transaction codes. A separate module, “Project, Grant and Endowment Management” offers an extra level of tracking outside of the GL. Once items are identified to the correct account or transaction code, the report writer can be used to create a series of templates that store account rollups specific to the needs of a given stakeholder.
The company’s PaperSave module helps organizations identify and track source documents, and it can be integrated with Excel and the rest of the Office Suite. Paper documents can be scanned and converted to searchable documents maintained in a SQL database. In addition, attachments can be routed and approved to insure that every expenditure is coded to the proper account. Once detailed budgets have been created for a specific project or grant, they can be associated with actual expenditures and re-forecasted as needed.
Blackbaud’s Financial Edge offers a powerful tool for managing all aspects of a Non Profit organization. When combined with their respected fundraising solution, Raiser’s Edge, the Financial Edge empowers a Non Profit to stay focused on its mission.
Price: Single user, CMS Fund, $1,208; Fund Suite $3,870, Fund Revenue Center $1,450. Unlimited users, Fund $3,624; Fund Suite $6,411. Multi-user, Fund Revenue Center $1,752.
Cougar Mountain offers two options, CMS Fund Software, a basic accounting solution including just a General Ledger and Bank Rec and the CMS Fund Suite Software that tracks vendors, handles payroll and manages expenses. It also markets a POS program for nonprofit organizations that have a retail facility. The Boise, Idaho-based company touts its US-based software support team as a distinction.
New in the 2010 release, Cougar Dtails offers a visual view into three aspects of an organization: revenue and expenses, cash flow, and financial indicators. Pulling from general ledger data, the dashboard also provides drill down access into transaction details. Using the optional GL Report Generator module, a Director can also create custom financial statement reports and reusable report templates. Information can also be broadcast to interested stakeholders via an add-on PDF blaster module.
Organizations needing flexible account structures will find six segments in CMS Fund -- three user-definable segments plus three pre-defined segments for Fund, Account and Project. In addition, the system offers options for allocating costs across projects, funds and accounts.
For tracking purposes, CMS Fund offers reporting of budget versus actual costs in the general ledger. In addition, documents and reports can be attached to master records to provide additional details regarding expenditures. Organizations looking to track statistical values will need to export account data to CSV files and then append statistical information there.
Cougar Mountain offers nonprofit organizations an affordable way to manage both non-profit and for-profit activities from a single application.
Sage NonProfit Solutions
Price: Starts at $2,995 (single-user). Most common configurations, more than one user and modules, $9000 to $10,000.
Sage acquired MIP (short for Micro Information Products) in 2001. At the time, MIP was known for its claim that “they put the FUN in Fund Accounting.” That message and the software have both evolved since those days, but here’s hoping Sage still makes fund accounting fun for its users. The product family has adopted some of the numbering concepts that other Sage products use, and there are products ranging from Sage Fundraising 50 to Sage Fundraising 100 to Millennium.
Executive directors will be able to access information at a glance in the Visual Analyzer tool released in version 10.2. This MIP dashboard can be modified to include custom views and forms and provides drill down access to additional details. If your organization spends too much time worrying about compliance, you’ll be happy to learn that MIP’s current release included form 990 enhancements and a GASB reporting module. And MIP also offers a view-only license to keep directors from causing trouble.
When it comes to flexibility, MIP claims to offer an unlimited number of segments in its table-driven chart of accounts. The product also delivers flexibility by allowing a user to navigate through the application through either a workflow view or a tree structure. In addition, the add-on allocation module provides both direct and indirect allocations of expenditures across projects, grants and funds.
Transparency from budget to activity to outcome is managed in MIP via its grant management and allocation modules. All grant-related documents can be scanned and filed and then organized into pre-award, post-award and close-out records for easy access. Allocations can be based on transaction entry counts such as invoices entered or Purchase Orders issued, fixed percentages or unit measures and other non-financial data collected using statistical fields. Pre- and post-allocation reports can provide additional insight to organization auditors.
Sage MIP offers Not for Profits the kind of organizational insight that helps them stay focused on their cause.
Price: Modules start at $3,000.
Serenic Navigator is built in the Microsoft Dynamics NAV application which means it has tight integration to many Office products as well as access to other tools like Sharepoint and Microsoft SQL. It offers virtually endless modification options to the nonprofit organization and includes multi-language and multi-currency options as a matter of course (thanks to the Danish origins of its parent application.)
An executive director looking for information will be pleased with both the role-based access and Web portals that are standard fare. The portals provide information to a director anytime, anywhere (so they can continue to work while on vacation) while the role-based access helps insure that only relevant information is made available to the director and staff members. Role centers allow each user to create a personal dashboard to quickly display information that is meaningful to them.
Navigator delivers reporting flexibility with 10 dimensions for core GL classification (using up to 110 alphanumeric characters) plus an unlimited number of additional dimensions for sub-ledger reports.
It also supports consolidation of multiple entities, flexible accounting calendars and an unlimited number of foreign currencies.
By adding AwardVision and Advanced Allocations to the core Navigator modules, an organization can track detailed budgeted line items all the way from proposal to award to mission accomplished. Add to that AwardVision Plus and the organization is able to attach supporting documentation directly to individual sub-award records. Finally, by adding the Workflow Management module, an executive director can automate the approval process so that only authorized expenditures are charged to a given grant or fund.
Serenic Navigator gives an NFP organization a system that works with its people and processes, rather than around them.
Employees of nonprofit organizations need the patience of Job and the skill of a surgeon to wade through all of the red tape and reporting requirements that impact them. Every time an automated solution can reduce the burden of reviewing information, allocating costs, and tracing the flow of funds from donor to recipient, they are freeing up organization resources to serve another worthy recipient. Thankfully, the solutions reviewed above offer ample options for NFPs – you might even say that their mission is accomplished.