Who doesn’t love the last-minute scramble to find lacking invoices or monitor down uncashed checks so you’ll be able to end your month-end shut?
A great reconciliation course of retains your monetary information correct and updated. However with out the suitable methods, this course of might be mind-numbingly time-consuming and vulnerable to errors. By integrating fundraising and finance methods, data flows simply from reward information to journal entries, saving time, decreasing the chance of fraud, and simplifying audits.
Right here’s how a linked fundraising and finance system can simplify reconciliation for nonprofit organizations, and what it might appear like in follow.
Why Is Reconciliation So Difficult?
Reconciliation is the method of matching monetary information from totally different sources, similar to reward information, invoices, and financial institution feeds, to make sure consistency and accuracy. If presents aren’t reconciled to the suitable program—or any program—it’s tough to be sure you are adhering to donor intent.
For nonprofit organizations, reconciliation usually entails matching invoices to financial institution information, formatting information in Excel, and guaranteeing that contributions are accurately recorded in each the fundraising and accounting methods. The reconciliation course of may cause complications for quite a lot of causes, together with:
Guide Processes
Many nonprofits nonetheless depend on guide processes for information entry and matching information. This not solely will increase the chance of human error but in addition requires important effort and time.
Duplication of Efforts
Typically, the identical information must be entered into a number of methods, resulting in duplication of efforts and growing the probability of discrepancies.
Compromised Audit Path
And not using 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, scale 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 making ready information, whereas finance groups might spend 8-12 hours per 30 days matching information and posting to the final ledger. Simply think about what you possibly can do in case you have been capable of lower that point in half.
How a Related Fundraising and Fund Accounting System Simplifies Reconciliation
Integrating fundraising and finance methods can tackle most of the challenges related to reconciliation.
Much less Guide Information Entry
By connecting fundraising and finance methods, you enter information as soon as and it’s mechanically shared between methods. This reduces the necessity for guide information entry, minimizes errors, and ensures extra correct information. You don’t have to decipher the place the funds have to go when your methods are linked.
Automated Transactions
You’ll be able to simply automate transactions so you will get contributions into the system rapidly 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 assist your mission. And the automation additionally minimizes the burden in your employees.
Clear Paper Path
A linked system supplies 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
Once you join your fundraising and finance methods, the methods move information immediately to every facet with out the necessity for reformatting or manipulating spreadsheets. The methods basically mirror one another and there’s a pure place for contributions to land in your fund accounting system. This ensures consistency and helps keep inside controls.
What a Related Reconciliation Course of Seems to be Like
With a linked system, the reconciliation course of turns into way more streamlined and environment friendly. Right here’s what it seems to be like in follow:
Seamless Information Circulation:
Information flows seamlessly from the event group to the finance group. Contributions are entered as soon as within the fundraising CRM—similar to Blackbaud Raiser’s Edge NXT®—and are then “pushed” into the accounting system—similar to Blackbaud Monetary Edge NXT®. This creates a single supply of fact that everybody can entry.
Empowered Groups
Everybody within the group has entry to the knowledge they want. This builds belief throughout groups as a result of everybody can see that funds are used for his or her supposed objective.
Constant Consumer Interface
A constant person interface throughout methods makes it simpler for workers to make use of the know-how and reduces the training curve.
Automated Processes
Mechanically batch recurring presents in order that they movement on to finance, eliminating guide processes and guaranteeing that nobody by chance misses recurring funding.
Streamlined Info Sharing
With a linked 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 concerning the aim of the funds—and might 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 linked methods, the audit path is evident and constant. For instance, clicking on the challenge ID in Monetary Edge NXT from a journal entry that was pushed from Raiser’s Edge NXT will determine 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 linked fundraising and finance system can considerably simplify reconciliation for nonprofit organizations. By decreasing guide information entry, automating transactions, and offering a transparent paper path, these methods save time, scale back the chance of fraud, and make audits simpler. Consequently, nonprofit organizations can focus extra on their mission and fewer on administrative duties. In case you’re trying to streamline your reconciliation processes, think about implementing a linked fundraising and finance system right now.
See a linked system in motion with a product tour that includes Raiser’s Edge NXT and Monetary Edge NXT.
