Plumb Creates Financial Transparency with Non-Profit Accounting Outsourcing
Is non-profit accounting outsourcing right for you? The financial bottom line matters the most when it comes to nonprofits. Since every donation and dollar counts, non-profits seek ways to save money and be more efficient, so they can focus on their mission statement.
In the non-profit sector, every dollar and donation significantly impacts the organization's ability to achieve its mission. Non-profit organizations, especially small to mid-sized ones, are increasingly recognizing the value of outsourced accounting. This shift is driven by the need for cost savings, access to accounting professionals, and expertise on an as-needed basis. The choice to outsource is often a strategic one. It is often aimed at enhancing the organization's financial management capabilities while being mindful of budget constraints.
Optimizing Non-Profit Operations with Plumb’s Non-Profit Accounting Outsourcing
For non-profit organizations, financial management is a critical component that demands both transparency and efficiency. Plumb offers a specialized approach to non-profit accounting outsourcing, providing a cost-effective and highly skilled alternative to in-house financial management. This approach not only saves money but also enhances the financial acumen within the organization. Thus, allowing non-profits to focus more on their core mission.
Top Reasons Why Non-Profit Accounting Outsourcing is a Better Option
Outsourcing accounting in the non-profit sector brings several key advantages:
- Cost Efficiency: Outsourcing is generally more cost-effective than maintaining an internal team. It allows non-profits to pay only for the level and amount of services they require, avoiding the overhead associated with full-time staff.
- Access to Expertise: Outsourced services provide a higher level of accounting expertise and resources, which might be otherwise inaccessible for many non-profits.
- Enhanced Internal Controls: With outsourcing, non-profits benefit from stronger internal controls which leads to more efficient policies and procedures.
- Improved Financial Reporting: Timely and accurate financial reports are crucial for making informed decisions. Accuracy and organized reports are indicators of professional outsourcing services.
- Fraud and Error Reduction: Greater segregation of duties in financial reporting helps to eliminate fraud and errors.
Plumb’s 7-Step Process for Non-Profit Accounting
At Plumb, we have developed a non-profit accounting outsourcing 7-Step Process to create a road map with objectives and milestones to reach. This gives our non-profit clients a clear picture of phase objectives and key deliverables. With outsourced accounting, you can scale the services to meet your specific needs.
- Step 1: Understanding of Entity and Mission
This initial phase involves Plumb gaining a thorough understanding of the non-profit's objectives and mission. This foundational knowledge is crucial for tailoring the accounting services to align with the organization's goals. This is followed by reviewing the existing financial policies and procedures. It helps identify areas for improvement and ensures that the accounting practices are in line with the nonprofit's mission and regulatory requirements.
- Step 2: Access to Financial Dat
Essential in this phase is the understanding of the organizational structure, directory, and list of service providers. Gaining insight into the key personnel and external service providers lays the groundwork for seamless integration and coordination of financial operations.
- Step 3: Accounting Setup
The focus of this phase is on reviewing and setting up a suitable chart of accounts to reflect the non-profit’s financial structure for accurate reporting and tracking. Followed by implementing fund accounting, allocating net assets, and establishing strong internal controls.
- Step 4: Financial Process
This involves preparing a thorough budget that aligns with the non-profit’s financial and organizational goals. Also, regularly arrange the conduct of account reconciliations, and forecasting cash flows to ensure smooth financial operations.
- Step 5: Financial Statement Preparation
Developing reports that compare current financial data with previous periods for trend analysis. Creating statements that highlight the variances between the budgeted figures and actual financial performance provides a clear view of the financial health of the non-profit.
- Step 6: Beyond the Numbers
This step involves analyzing key financial analytics and ratios that provide deeper insights into the non-profit’s financial health. At the same time, preparing presentations for the finance committee and board to ensure they are well-informed on the decision-making.
- Step 7: Compliance
The final phase encompasses pre-audit assistance and the preparation of tax deliverables. This is by helping to ensure all financial records are accurate and complete for a smooth audit process. Additionally, this step makes sure the non-profit remains compliant with all regulations.
To view the 7-Step process in detail, click here.
Plumb’s non-profit accounting outsourcing service offers a structured, professional approach to financial management for non-profits. By adopting this model, non-profit organizations can ensure not only cost savings but also gain access to high-level accounting expertise. Organizations can improve their internal financial processes, and enhance their overall financial transparency and governance. This strategic decision allows non-profit leaders to focus more on their mission and less on the complexities of financial management.
