When accountants think about software for nonprofits, they typically are talking about accounting systems. But nonprofits, especially those that are government entities, have different needs in an accounting system than do charitable organizations or foundations.
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Adding to the confusion, nonprofit software also encompasses donor management, which, in many cases, is a more important choice for the client than the particular accounting system being used.
Making this choice isn't easy. Every nonprofit entity has its own needs regarding the set-up of the accounts, and how accessible the software is to use. In many cases, especially with smaller nonprofits, the people operating the accounting system (and most likely the donor management system) will be part-timers or volunteers. If the software isn't closely tailored to the particulars of the entity, such as funds, endowments and the like, as well as being able to easily switch to different accounting methods to accommodate the reporting needs of different agencies, it will be easy for an inexperienced user to make mistakes.
Having software that will conform to the needs of the nonprofit organization, rather than making the organization conform to the constraints of the software, is something to consider when helping your clients make a choice. There are "nonprofit" versions of many of the popular entry-level and mid-range accounting systems. Depending on your particular client, one of these may be more suitable - or none of them may be the right choice.
In this roundup we looked at 11 nonprofit accounting systems, one or two of which might be a good fit for one of your nonprofit clients. We did not give prices, as almost all of these systems need to be installed and configured by a professional reseller familiar with the specific software. That can add considerable cost to the bottom-line price, rendering retail price on the software somewhat misleading.
The vendors shown in this roundup are not the only ones providing accounting software for nonprofits. Additionally, there are numerous vendors of other types of software targeted at the nonprofit market, including donor management software and fundraising applications.
Techsoup.org is an organization set up to supply nonprofits with software and hardware that has been donated by vendors. In many cases, this software is a version behind what is currently being sold, and all products are available for considerably less than the current retail price. At the time this is being written, the only nonprofit accounting system being listed is QuickBooks Nonprofit Edition, but eligible nonprofits can get donor management and fundraising applications, as well as office suite and operating system software, at steep discounts. This makes Techsoup.org an excellent resource, and something that you should have all of your nonprofit clients who qualify enroll in.
Available in both in-house and Software-as-a-Service applications, AccuFund provides most of what many nonprofits will require in an accounting system in its core system. These sub-applications include general ledger, reporting (both financial and budgeting), accounts payable, cash receipts, system security, a report generator, and bank reconciliation.
MICR check printing allows your nonprofit client to make payments from different fund, grant or endowment accounts without having to purchase and store excessive amounts of check stock. However, the electronic payment capability in accounts payable and payroll may lessen the impact of this feature.
By creating a core system and offering other capabilities as add-ons, AccuFund helps you design a moderately custom system for your client. In all likelihood, most of your nonprofit clients are going to require at least some add-ons, such as Grants Management, Allocation Management, Budget Development, and others from the long list of additional sub-applications that AccuFund offers. But the net result should be that your client doesn't wind up paying for features they don't need and won't use. If, at a later time, the client does develop a need for additional features, these can be easily rolled into the existing system.
Denali Fund Accounting
Cougar Mountain Software
Cougar Mountain Software has been around for several decades, almost since the birth of the personal computer. Like a number of companies that grew into computer giants, including the companies that became Dell and Gateway, Cougar Mountain Software was initially sold exclusively through ads in Computer Shopper, and was known for its point-of-sale applications.
A lot has changed over the years. Cougar Mountain's Denali accounting software is a solid mid-range accounting offering, and the Fund Nonprofit Software is constructed on the Denali foundation, but structured for use in the nonprofit environment. It provides the core accounting modules, GL, Accounts Payable and Receivable, and Bank Reconciliation, but other Denali modules, such as Payroll, Point of Sale, Order Entry and Inventory (for nonprofits that have a retail function) are available. Also available for the Denali system is integration with DonorExpress (a third-party application) to provide an extension of the accounting system. The General Ledger offers budget management tools along with a five-year calendar that allows for multiple fiscal year ends.
Cougar Mountain has offered the Applianz server pre-installed and preconfigured for a number of years. This server, which Cougar Mountain calls Singlepoint, is also available for the Denali Fund system, and can save your client a considerable amount of time and expense in getting up and running.
CYMA Not-For- Profit Edition
CYMA Systems is another long-time accounting software vendor. It has been offering generic accounting software as well as a nonprofit version for decades, so it's a mature product. CYMA NFP Accounting Software is exceptionally modular, so it will be easy to configure a system that very closely matches your clients' needs. Along with the more common modules, such as General Ledger, AR, AP and Payroll, CYMA offers optional modules such as a Grant Tracking add-on for General Ledger, Human Resources, Bank Reconciliation, and sub-applications for entities that maintain a retail presence as part of their operation. These include Purchase Order, Sales Order, and Inventory. Employee Self-Service is another optional add-on.
Financial statements are FASB 117-compliant, and the system produces automatic inter-fund offset entries that can be defined by the client.
As with a number of vendors in this round-up, CYMA Systems offers a 30-day trial, so if the software looks like it would be a good choice for a client, you can get it and take a closer look before your client commits.
The Financial Edge
The Financial Edge is a comprehensive nonprofit accounting system built around a core GL and seamlessly integrating with the vendor's Raiser's Edge Donor Management system. Depending on the modules chosen, the Financial Edge can provide sophisticated analytics and reporting, as well as the ability to manage grants, gifts, endowments and the like to a very granular level. Advanced budgeting is available as an ancillary product, as are connections to other Blackbaud products like eTapestry and products to manage online collections. A wide variety of reports are available, as are customizable dashboards, and F9 and easy spreadsheet integration make ad hoc reporting a fairly painless process.
Having been a developer and vendor focused from the start on the nonprofit community, Blackbaud has considerable experience with the differences that different types of nonprofit entities present. With almost 30 available modules, there is considerable flexibility to configure a system for nonprofit clients of varying sizes and in various entity types (schools, churches and others, for example).
A strong user community exists for The Financial Edge, which is another support resource in addition to the vendor's own support system. The Financial Edge is targeted mostly toward midsized and larger organizations. A new cloud-based version recently became available that lets smaller nonprofits take advantage of the application for a fixed monthly subscription fee.
Fund E-Z Nonprofit Accounting
Fund E-Z Development Corp.
Fund E-Z is available in two versions, Fund E-Z and Fund E-Z Pro. Fund E-Z is the basic core system, and provides GL, Bank Reconciliation, Budgeting, AP, AR, Client Billing, and Direct Allocations. Reports are FASB 117-compliant, and there is support for the F9 report writer. For many nonprofits, these will provide the needed capabilities, and the Fund E-Z accounting applications integrate with Fund Easy Fundraising to provide a more comprehensive system when appropriate.
Some features, however, are only available in the Fund E-Z Pro edition of the software. These include a more flexible user-defined chart of accounts, custom reporting, interfund balancing, automatic offsets, and indirect allocations.