Non-profits are an essential part of our society. They help people in need, provide opportunities for youth and seniors, and do a lot to improve the quality of life for those who live in their area. But how can non-profits make sure they are doing all that they can?
Well, one way is by hiring an accountant. An accountant will ensure your organization stays on track financially, so you don’t end up with any surprises or problems down the line.
Why do Non-Profits Need an Accountant?
Accounting is about more than balancing the books. Accounting professionals are needed to help with making financial forecasts, data analysis, tax planning and compliance, budgeting, payroll review, and management or fund development, among many other tasks. If you manage a non-profit organization, you may have thought: can accountants near me help generate more profit or improve the organization’s cash flow?
Accounting professionals can help you establish a budget and forecast finances, which is essential for any business. An accountant will work with your board of directors to create detailed financial plans that are achievable and realistic.
You may also need an accounting professional who specializes in fund development if it’s the goal of your non-profit to raise money from donors or foundations.
Non-profits need an accountant because they have a lot of money moving in and out every day that needs strict attention for compliance purposes. In addition, an accountant can save your organization time by reviewing all transactions, so you know what’s going on at any given moment without spending hours of staff time doing it yourself!
What Benefits Can Accountants Bring to the Table?
The benefits are endless when working closely with a professional who has experience accounting for non-profit organizations. Some examples include:
Helping with Compliance
Whether it’s making sure you are providing appropriate documentation to the IRS or reporting your tax-exempt donations, an accountant can help.
Keeping on Track Financially
Accountants may be required by law in some cases (depending on your location), and they will ensure that financial records are accurate and up to date.
Providing Data Analysis for Better Decisions
If a non-profit organization is struggling with budgeting or has not reached its fundraising goals lately, hiring an accountant who specializes in this area could provide insight into what needs fixing so things can get back on track.
Hiring an accountant doesn’t have to be expensive either! Many accountants offer fixed rates per hour which makes them affordable no matter what your budget.
How to Find an Accounting Firm for Your Non-Profit Organization
One of the most critical aspects of any non-profit organization is accounting. Without a strong focus on financials, it cannot be easy to maintain fiscal responsibility and operate best practices. The accountant you choose should have experience working with non-profits and other similar organizations that share your type of mission statement or goals.
In addition, an accountant should be able to provide counsel regarding tax laws as they pertain to charities and non-profits, so you know how much money will come into the organization each year versus what amount goes out based on expenses incurred during operations.
A qualified accountant who understands not only basic accounting principles but also wants your business to do two things simultaneously: make sure you’re operating within budget while maximizing revenue streams through donations from donors around the world.
Factors to consider when searching for an accounting firm:
- Location
- Fees associated with their work
- Their experience
- Personal and financial information security practices of the company, including how they store your data.
Your chosen firm should communicate with you individually, be transparent about their fees and explain how they will keep your financial data secure.
The Importance of Keeping Financial Records and Documents Secure and Accurate
We all know that a business owner must keep financial records and documents accurate. However, when you own your non-profit organization, this task becomes even more important because these records are not just about money.
They also include donor information such as names and their Social Security Numbers, personal tax returns with family income statements for donors, bank account numbers and balances of contributors, etc. Again, this may be sensitive identifying information if leaked into public view.
You would assemble a team of people from every department within your company responsible for tracking down errors in data entry, so mistakes are minimized. This team would likely include a bookkeeper, who is usually tasked with financial recordkeeping and data entry of transactions into accounting software.
To have accurate records in your organization’s books, this person must know how to use these programs efficiently, saving time and ensuring accuracy.
Plus, if they are also responsible for entering donor information into their system, it becomes even more critical to know what they’re doing. You do not want inaccuracies about donors being out there publicly viewable because one misplaced number can lead them right back to your organization!
It might sound like a hassle at first, but having an accountant on your team can come in handy.
Final words
Accountants are indispensable for non-profits. That is why it’s essential to hire an accountant for your organization to help ensure that accurate records are kept, and sensitive donor information is secured.
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