Outsourced Bookkeeping for Nonprofit:
Effective bookkeeping is essential for any nonprofit organization striving to achieve social impact. Our guide walks you through the process of setting up a successful system of financial record-keeping and budgeting, giving you tools to effectively manage resources, track expenses, and stay on top of your organization’s finances.
Set up proper bookkeeping best practices.
One of the most important steps to take when setting up bookkeeping for your nonprofit is to establish best practices. This will help ensure that you are accurately tracking expenses, balancing budgets, and allocating resources properly. Best practice for non-profits includes scheduling regular financial meetings, maintaining separate bank accounts for different areas of the organization, and keeping up on all legal filings and reporting requirements.
Track accounts payable and receivable.
Keeping accurate records of income and expenses is key to managing finances in any organization. It’s especially important for non-profit organizations because of the need to ensure all funds are managed properly, as required by law. To track accounts payable and receivable, keep detailed records of who owes the organization money, how much, and when payments will be due. Additionally, track any payments made by the organization to vendors or others for goods or services. Make sure all invoices are properly accounted for in your system prior to payment being issued.
Develop a system for budgeting and reporting.
A nonprofit organization needs to develop a system for budgeting and reporting that clearly outlines its financial goals. This system should be designed to help the organization not just measure its performance but also set realistic expectations for growth. To do this, create an operational budget with expected revenue and expenses for each month or quarter. Compare these projections with actual results in financial reports throughout the year to determine areas of strength or weakness in how funds are being managed.
Organize documents and receipts for IRS regulations compliance.
Maintaining accurate financial records is essential for all nonprofits, as they will often be audited by the IRS to ensure compliance with regulations. It’s important to keep invoices, receipts, and other paperwork related to your organization’s finances in a central location and organized systematically. Have designated staff members assigned with organizing documents and ensuring that they are available in the event of an audit? This consistency in filing will greatly help with the audit process.
Maintain an accurate chart of accounts for better financial tracking and insight into organizational trends and performance metrics.
- The chart of accounts is like a map of your nonprofit’s financial information. It’s the system you use to categorize and record all of your organization’s financial transactions.
- Having an accurate chart of accounts will help you track expenses, compare budget figures with actual results, and follow trends.
- This will also give you insight into your program performance metrics, allowing you to monitor your financial health over time and make decisions that align with your mission.
Why Velan Bookkeeping:
Velan Bookkeeping with its 16 years of experience as an outsourced bookkeeping service provider, offers Cloud Accounting and Bookkeeping, AR/AP, Payroll, and Controller services for various industry verticals. We cater to all types of clients, right from small businesses, and CPA firms to Fortune 500 companies spread across the USA.
Head Office :
8 The Green, Suite 300, Dover, DE 19901, USA.
Email: reachus@velan-bookkeeping.com
Phone: +1 727 756 1632
Website: www.velan-bookkeeping.com