Who doesn’t love the last-minute scramble to find lacking invoices or observe down uncashed checks so you possibly can end your month-end shut?
A superb reconciliation course of retains your monetary information correct and updated. However with out the precise programs, this course of may be mind-numbingly time-consuming and susceptible to errors. By integrating fundraising and finance programs, data flows simply from reward information to journal entries, saving time, decreasing the chance of fraud, and simplifying audits.
Right here’s how a related fundraising and finance system can simplify reconciliation for nonprofit organizations, and what it could appear to be in follow.
Why Is Reconciliation So Difficult?
Reconciliation is the method of matching monetary information from completely different sources, equivalent to reward information, invoices, and financial institution feeds, to make sure consistency and accuracy. If presents aren’t reconciled to the precise program—or any program—it’s troublesome to be sure to are adhering to donor intent.
For nonprofit organizations, reconciliation typically entails matching invoices to financial institution information, formatting knowledge in Excel, and making certain that contributions are appropriately recorded in each the fundraising and accounting programs. The reconciliation course of could cause complications for a wide range of causes, together with:
Guide Processes
Many nonprofits nonetheless depend on handbook processes for knowledge entry and matching information. This not solely will increase the chance of human error but additionally requires important effort and time.
Duplication of Efforts
Usually, the identical knowledge must be entered into a number of programs, resulting in duplication of efforts and growing the chance of discrepancies.
Compromised Audit Path
With out a clear and constant audit path, it may be difficult to hint transactions and be sure that all funds are accounted for. This may complicate audits, cut back transparency, and open the door to fraud.
Time-Consuming
Improvement groups can spend 30-40 hours per 30 days getting presents into the CRM and getting ready knowledge, whereas finance groups could spend 8-12 hours per 30 days matching information and posting to the overall ledger. Simply think about what you may do should you had been in a position to minimize that point in half.
How a Related Fundraising and Fund Accounting System Simplifies Reconciliation
Integrating fundraising and finance programs can tackle most of the challenges related to reconciliation.
Much less Guide Knowledge Entry
By connecting fundraising and finance programs, you enter knowledge as soon as and it’s robotically shared between programs. This reduces the necessity for handbook knowledge entry, minimizes errors, and ensures extra correct knowledge. You don’t have to decipher the place the funds have to go when your programs are related.
Automated Transactions
You’ll be able to simply automate transactions so you will get contributions into the system shortly and simply, dashing up the method of going from funding to disbursement. The faster you will get funds into your system, the sooner they can be utilized to help your mission. And the automation additionally minimizes the burden in your employees.
Clear Paper Path
A related system offers a transparent paper path from the preliminary reward settlement to the paid bill. This makes it simpler to hint transactions and ensures transparency.
Systematized Inside Controls
If you join your fundraising and finance programs, the programs cross knowledge instantly to every aspect with out the necessity for reformatting or manipulating spreadsheets. The programs basically mirror one another and there’s a pure place for contributions to land in your fund accounting system. This ensures consistency and helps preserve inside controls.
What a Related Reconciliation Course of Seems to be Like
With a related system, the reconciliation course of turns into far more streamlined and environment friendly. Right here’s what it seems like in follow:
Seamless Knowledge Movement:
Knowledge flows seamlessly from the event crew to the finance crew. Contributions are entered as soon as within the fundraising CRM—equivalent to Blackbaud Raiser’s Edge NXT®—and are then “pushed” into the accounting system—equivalent to Blackbaud Monetary Edge NXT®. This creates a single supply of reality that everybody can entry.
Empowered Groups
Everybody within the group has entry to the data they want. This builds belief throughout groups as a result of everybody can see that funds are used for his or her meant goal.
Constant Consumer Interface
A constant person interface throughout programs makes it simpler for workers to make use of the expertise and reduces the training curve.
Automated Processes
Routinely batch recurring presents in order that they move on to finance, eliminating handbook processes and making certain that nobody by chance misses recurring funding.
Streamlined Data Sharing
With a related fundraising and finance system, your employees all through the group has extra full data on how and when funds are getting used. Everyone seems to be on the identical web page relating to the aim of the funds—and may simply keep there. That readability makes month- and year-end processes extra environment friendly. There may be nothing worse than discovering an error after funds have been used and expensed.
Improved Audit Path
With related programs, the audit path is obvious and constant. For instance, clicking on the venture ID in Monetary Edge NXT from a journal entry that was pushed from Raiser’s Edge NXT will establish the matching file within the fundraising system. This makes it simpler to trace transactions and ensures that each one funds are accounted for.
Getting Began with a Related Fundraising and Fund Accounting System
A related fundraising and finance system can considerably simplify reconciliation for nonprofit organizations. By decreasing handbook knowledge entry, automating transactions, and offering a transparent paper path, these programs save time, cut back the chance of fraud, and make audits simpler. Because of this, nonprofit organizations can focus extra on their mission and fewer on administrative duties. Should you’re trying to streamline your reconciliation processes, take into account implementing a related fundraising and finance system at present.
See a related system in motion with a product tour that includes Raiser’s Edge NXT and Monetary Edge NXT.
