staff Whether virtual CFO services, controller-level solutions, or bookkeeping and accounting support, outsourcing your financial needs saves you money. You’ll also have instant access to a vetted firm that understands your organization and mission.
A reputable outsourced accounting service team will become familiar with your operations and be a resource for you and your board of directors. They’ll also be able to provide you with the following benefits:
Reduced Costs
Hiring and retaining full-time accounting and financial oversight experts in a nonprofit context can be difficult. An experienced managed service provider provides a team of accountants and bookkeepers dedicated to the organization’s needs. In addition, these team members can help with bank reconciliations and provide additional assurance on the system of internal controls.
Nonprofit staff often wear many hats, especially during times of transition and during high demand for services. By outsourcing these accounting and bookkeeping functions, your team can focus on their most important responsibilities: recruiting donors, fundraising, and program management.
Moreover, your outsourced CPA for nonprofits will be current on the latest regulatory changes impacting the nonprofit sector. As such, they can help your organization create cost-saving efficiencies, implement best practices and improve compliance. This will allow your executive team to make informed budget decisions that will help drive organizational growth. You can also trust the firm to handle revenue recognition rules involving donations with and without donor restrictions, exchange transactions, and the valuation of contributed assets. This ensures you comply with tax regulations and accurately report revenues.
Flexibility
Nonprofits often require unique financial accounting needs that differ from for-profit companies. These needs include reporting, audits, tax compliance, and more. Using an external CPA firm provides flexibility to meet these needs and other specialized services like budgeting, forecasting, and implementing accounting software systems. An experienced managed service provider can sometimes be a virtual CFO or controller if a nonprofit organization cannot afford full-time, skilled resources.
Additionally, a managed service provider will have the bench strength to provide backup if in-house personnel become overwhelmed. This helps ensure that accounting and other financial functions are being handled properly. The best part is that you can hire these skilled professionals on a contract basis, so they’re there when your nonprofit needs them – allowing you to focus on your company’s mission. Whether you need virtual CFO services, controller-level oversight, or bookkeeping and payroll, an external firm can provide the expertise your nonprofit requires at a fraction of the cost of a full-time employee.
Time Savings
Managing financial accounts for nonprofit organizations is a different animal than that of for-profit businesses. Nonprofits have more regulations to work and are also tasked with being good stewards of the money they receive. Your nonprofit could save valuable time and energy by outsourcing your accounting to a full-service firm.
Whether it’s a small nonprofit that cannot afford a full-time, experienced chief financial officer or a large organization facing a staffing crisis, managed service providers can help. By providing highly skilled professionals as needed, your nonprofit can address immediate needs and build for the future.
Additionally, working with an outside firm will reduce the learning curve for in-house staff and ensure that processes are updated with best practices and the latest technologies. This helps minimize the risk by providing the segregation of duties and consistently improving reporting by delivering actionable data. This is especially important for nonprofits that use a complicated accounting system such as fund accounting. This system requires a high degree of knowledge to manage and interpret data.
Experience
Nonprofits need experienced help with their financial management. Often, they can outsource bookkeeping or accounting services to an outside firm. In other cases, they may outsource tax preparation or audit support functions. Some nonprofits outsource their entire accounting department, while others outsource specific aspects of the work, such as payroll or budgeting.
The benefit of working with an experienced CPA firm is that they can offer a consistent team of professionals that will quickly become familiar with your nonprofit’s operations. This allows your staff to spend time on more mission-focused projects and tasks while ensuring that all the responsibilities associated with running your organization are met.
Working with a knowledgeable CPA can help your nonprofit avoid costly mistakes by ensuring that all the necessary taxes are paid and filed promptly. The right firm can also provide guidance and expertise around the complexities of filing tax-exempt returns. This helps your nonprofit maintain compliance and minimize the risk of potential audits or fines.
Compliance
When you work with an accounting firm specializing in nonprofit bookkeeping and financial services, you get more than just an accountant. You also have a team of experts that can stay abreast of the latest regulations, reporting requirements, and best practices specific to your sector.
This can be especially helpful for nonprofits that use fund accounting (which involves tracking funds separately for different purposes, allocations, or programs) to maintain compliance with donor restrictions and tax exemptions. It can also benefit nonprofits that comply with strict 990 filing standards or other government financial reporting guidelines.
It can be challenging for nonprofits to find and hire experienced financial professionals. And even when they do, bringing them on board full-time can be costly, with costs associated with hiring, training, managing, and providing health insurance benefits. Working with a managed service provider specializing in nonprofit financial accounting and bookkeeping can eliminate those expenses and provide the expertise your organization needs. Scrubbed is an excellent example of this, having worked with hundreds of organizations—including many nonprofits—to help them save money and focus on their mission.
