Understandably most non- profits run on a tight budget. As a result, they often use minimum staff and depend on volunteers to help them with routine tasks and responsibilities. While this may be fine with most areas of running and managing a non- profit, it can be disastrous when it comes to bookkeeping and accounting. Here is why you need professional help with your non- profit bookkeeping.
- Meet Non- Profit Filing Requirements– There are a couple of things that non- profits have to compulsorily do with diligence to maintain their 401(c) status- reports to file, satisfy boards with in depth analysis and reports of donations, expenses, accounting etc. All this requires a dedicated bookkeeper rather than changing volunteers. Non- profits need stability to keep things running smoothly and depending on volunteers will rarely give you that.
- Save Money– Yes, you save money when you spend money on small business bookkeeping services. Hiring professionals will not be as expensive as you would like to think. Professionals tend to be quick and thorough with their job, which means work gets done faster and also leaves everyone, including the IRS, satisfied. Plus an experienced small business bookkeeping services bookkeeper will also be able to spot areas where expenses can be curbed, where you are losing money etc, thereby allowing you to make informed business decisions and save money.
- Efficient Grant Proposals– Non-profits need grant money and for this you need reports that clearly state what the money is being used for and how it will be used. Small business bookkeeping services will ensure you have thorough and accurate reports for your grant proposals. A volunteer isn’t likely to put together a convincing and efficient report for this purpose.
- Minimize Fraud– Non- profit organizations are probably the most hit by fraud and embezzlement. By using small business bookkeeping services, you ensure you have reliable and honest bookkeepers and accountants at hand. The multiple layers of security that professional bookkeeping agencies employ also ensures that your records and books are kept safe and free from tampering.
Running a non- profit is not easy. Aside from arranging for funds needed to keep the organisation running, there are numerous other issues that are troublesome and time consuming; one such task is bookkeeping and accounting for non- profits. Non- profits have certain tax benefits, but to avail of these benefits, you need to maintain clean and accurate books. Lack of funds often means that non- profits depend on volunteers to take care of the bookkeeping, so no bookkeeping services fees; definitely not a good thing. Here is why this doesn’t often work out for non- profits.
- Proper Handling of Tax Related Documentation– Regulatory reporting and filing is required to maintain the 401(c) status in non- profit bookkeeping. Non-profits are also required to keep thorough records and detailed reports, annual and otherwise, to satisfy their donors and patrons. These conditions are difficult to meet if you are working with volunteer bookkeepers as they may not have the time, and sometimes, expertise to handle the responsibilities.
- Save Money– Time is money. Save time, save money. An experienced bookkeeper, irrespective of the bookkeeping services fees, can take care of your bookkeeping in a fraction of the time that your volunteer can. You can also relax in the knowledge that your books are being handled with care by professionals. Another reason is that non- profit bookkeeping and accounting when done efficiently can save your organisation money by finding and rectifying financial leaks in your system. You will also get weekly, monthly and annual reports that can help you manage your non- profit’s finances better.
- Minimize Bookkeeping Fraud– Fraud and embezzlement are among the biggest problems faced in non- profit bookkeeping; such activities in a non-profit can cost the organization its reputation and goodwill. Outsourcing to professional bookkeeping and accounting services is a good way to prevent this issue. The multiple layers of security measures and safety nets in place in professional bookkeeping firms ensure that your data is safe and your funds are not misappropriated.
While bookkeeping services fees are a matter of concern for most non- profits, the benefits of using professional services largely outweigh the cons; and the bookkeeping services fees are really not as much as you fear.