Posted by geemiz | Posted in Accounting Software | Posted on 05-11-2010
Tags: best accounting software
If you think that all organizations are built to produce profit and distribute them among owners then you are wrong. There is what you call a not for profit organization also called as non-profit organization. This not for profit organization is built not to distribute profit among owners but instead use the funds to pursue certain goals. A good example of non-profit organizations is charities and public arts organization. This form of organizations is mostly exempted from its countries income and property taxation.
But we are not here to discuss the mentioned type of organization. This article will discuss about not for profit accounting software. Every NPO (not-for-profit organization) faces challenges that are different from organizations for profit or commercial companies. To help aid these challenges a NPO must used accounting software that uniquely meets its needs.
Not for profit accounting software allows companies to use tools to manage its business processes. The need of funds and social impact are two of the most common problem of a nonprofit organization and are the key to reach organizational goals so it is best to focus in these areas. Accounting software can be of big help to increase social value and promote the stewardship of funds.
It is mentioned that NPO is different from commercial companies, so accounting software for NPO is different from the accounting software of organizations for profit.
Below are requirements for not for profit accounting software
Understandable Reports for Funding Sources
Aside from the accounting staff it is necessary that the accounting reports must be easily understands by the funding sources and the boards, because these are the people who give funds to the NPO’s projects. If these people do not understand the report then there will be no allotted money for a project. Not for profit accounting software provides report that shows where the past fund goes and what the future initiatives of the upcoming funds are.
Anticipating Cash-Flow
Cash management is of huge importance to NPO because the nature of funding in this form of organization is unpredictable. Aside from revenues it may be in a form of endowments or grants. The ability to easily anticipate upcoming expenses, burdens and the available resources can be provided with the use of this accounting software.
Easy to Use and Flexible
One critical requirement for a not for profit accounting software is its ability to be used easily. Unlike for profit organizations, not for profit organizations staffed are mostly volunteers who tend to work only during their free hours or if their schedule allows. Some organizations do not have personnel that have an accounting background and most of the time they are changing personnel’s. Easy to use and flexible accounting software is highly needed.
In choosing for a not for profit accounting software make sure to remember all the requirements that are mentioned above and you will have no problem in reaching your organizations goals.
