Finding software can be overwhelming. We've helped many government agencies and nonprofits choose the right fund accounting software so they can separate funds and increase accountability.
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Sage Intacct is a provider of cloud-based financial management and accounting software. Sage Intacct's software solution is suitable for small to midsize accounting firms and can provide financial reporting and operational i... Read more
Financial Edge NXT is a cloud accounting solution from Blackbaud that provides transparency across teams, security, compliance, and reduces the need for manual processes. The system is a fund accounting solution that provides a ge... Read more
FUND E-Z is a fundraising software for nonprofits that gives visibility into every facet of their organization. The software helps users to create and track budgets across fiscal years, detailing actual vs. budget for multiple pro... Read more
Banyon Data has 37+ years experience developing fund accounting software for the public sector. The software is a great fit for small to midsize entities looking to enhance budget tracking and make the overall accounting process ... Read more
QuickBooks Online is a web-based accounting solution that caters to individual accountants and small businesses. The solution helps with bank reconciliation, tracking expenses, drafting invoices and monitoring financial reports, a... Read more
Established in 2006, Xero is a web-based accounting system designed for small and growing businesses. Xero connects small businesses with their trusted advisors and provides business owners with instant visibility of their financi... Read more
Donor Tools is a cloud-based donor management solution developed by Higher Pixels. it caters to small and mid-size nonprofits, charities and faith-based organization. The solution allows fundraisers to track contributions from mul... Read more
Denali FUND is an on-premise and cloud-based accounting solution designed for nonprofits with multiple funds. The product is suitable for small to midsize nonprofit organizations. Primary features include grant management, donatio... Read more
For almost forty years, Open Systems, Inc. has been creating economical and modular solutions for Business Accounting and Enterprise Resource Planning. They have created TRAVERSE to give businesses the perspective needed to make i... Read more
CommunitySuite is a cloud-based non-profit management solution designed for small and midsize companies. Key features include fund accounting, a donor portal, online donation management, scholarship management and event management... Read more
Dynamo is a cloud-based solution that helps institutional investors and alternative asset managers maintain investor relationships through compliance document submissions, interested party mapping, account statements and more. Key... Read more
Realm is a cloud-based church management solution that helps users in church administration, accounting and community management. Users are provided with a mobile app to send messages to community members. The solution provides mu... Read more
The BUCS®, Budgetary Control System is a fully integrated, True Fund Based Accounting System designed to meet the specialized needs of government, nonprofit, and utility operations. The BUCS® system is an easy-to-use system, that... Read more
Sparkrock provides SaaS-based finance, workforce management, payroll and employee scheduling software built for Not-for-Profit, Health and Human Services, and Educational organizations. Their software improves staff efficiency by ... Read more
Shelby offers church financial software that is used by and made for churches, denominational headquarters, faith-based nonprofits, and ministries. A GAAP compliant financial software. Shelby Financials is a cloud-based or on-prem... Read more
Eze Investor Accounting is an on-premise solution designed to help hedge fund offices, private equity shops, fund administrators and wealth managers handle all aspects of investor accounting processes. Professionals can use the pl... Read more
TRUSTprocessor is a trust and fund accounting software designed to help corporate businesses and non-profit organizations manage financial operations such as income distribution, asset allocation and more. Using its general ledger... Read more
Serenic Navigator for NGO is a comprehensive cloud ERP solution designed specifically for international non-governmental organizations. As a Gold Microsoft Alliance partner for Enterprise Resource Planning, Serenic Software can he... Read more
Popular Comparisons
Fund accounting is used by government organizations and nonprofits to separate funding amounts and spending by individual project or grant provider. Leveraging a nonprofit accounting software system built specifically for fund accounting, government organizations and nonprofits can create reports that prove how each funding amount is used responsibly and in accordance with its original purpose.
Here’s what we’ll cover:
What Is Fund Accounting Software?
What Type of Buyer Are You?
Benefits and Potential Issues
Market Trends to Understand
The Vendor Landscape
What Is Fund Accounting Software?
Not-for-profit accounting software keeps track of funds, expenses and transactions with accountability and stewardship as chief concerns. This attitude contrasts with the profit-maximizing motives of many commercial industries. A fund accounting system provides a self-contained, self-balancing ledger designated for a specific project, grant or donation. (For example, churches may use a church management suite with a fund accounting module to track member contributions.) The bottom line is transparency, accountability and responsible spending.
Various nonprofit organizations use fund accounting software, including:
- Faith-based groups
- Healthcare providers
- Social services and charitable organizations
- Federal, state and local government entities
Critical capabilities to look for include:
| Financial reporting | Create financial statements tracking all funds from donations, pledges and grants. Measure fundraising performance and donor retention. Look for features such as customization and automatic records transmission. |
| Fundraising and donor management | Securely solicit, collect and manage donations through multiple fundraising channels and campaigns. Manage existing donor sources and recruit prospective supporters. |
| Grant management | Keep track of awards and proposals, process funds and properly allocate to recipients (referred to as “allocation management”). |
| Multiple expense ledgers | Provides a self-contained, self-balancing ledger designated for a specific project, grant or donation. For example, churches may use a church management suite with a fund accounting module to track member contributions. |
What Type of Software Buyer Are You?
Before you can evaluate software, you’ll need to assess what kind of buyer you are. We believe 90 percent of buyers fall into one of the following categories:
Small organizations with limited budgets. Some nonprofit organizations, who are smaller and have limited budgets, sometimes opt for a “low-end” solution. This doesn’t necessarily imply inferior quality; these products simply don’t support functionality as broad as the more robust systems. These systems often cannot handle monetary figures as large as those processed in other software; nor can they consolidate checks for multiple invoices. This may be well worth the price trade-off when size and budget are considered.
Nonprofit organizations. Nonprofits need software to track donor-provided funds—separately from other funding sources—in order to report to providers on how each sum was spent. It can link spending information to individual projects, tracking project completion rate as well. Grant management support keeps records of past and future grant activities, tracking relationship and funding information to eliminate confusion.
Government organizations. Government organizations need government software to meet the demands of citizens who inquire about the use of public funds—this is where the individual ledger system comes in. Nonprofit financial software provides the precise fund tracking capabilities to make transparency possible through informed government reporting methods.
Benefits and Potential Issues
A fund accounting solution should help the nonprofit or government organization ensure that funds are spent responsibly, and that adequate funds remain for future plans. These systems should also benefit grant providers with satisfactory reports.
Keep individual funds separate. The top priority of fund accounting is to establish each funding source as a self-contained amount; this way, the spending of grants or donations can always be traced back to the source. Funding providers must know how each donation or grant is spent.
Increase accountability of the organization. If a nonprofit agency can’t prove to funding providers that grants and donations are being used responsibly and constructively, there’s no reason to expect continued funding in the future. Keeping track of these funds with software, and providing reports, is therefore essential for the success of a nonprofit organization. Similarly, government offices must keep strict track of spending in order to keep citizens informed.
Deliver clear, informative reports. In order to establish the accountability mentioned in the point above, a software system must be able to deliver reports. Reporting is critical for evidence of responsible spending. Therefore, a system has an advantage if it includes numerous customization capabilities and sophisticated reporting options.
Association with relevant projects. In addition to keeping funds separate from one another, fund accounting systems should allow expenses to be easily viewed in the context of specific projects. This is directly related to the system’s ability to report how each fund has led to effective action, thus increasing accountability and the likelihood of further funding.
As with most business technology, there are also potential issues and risks involved with fund accounting software. One major risk in any business system is the loss of critical data. There are several ways in which data loss can occur; an obvious example is physical damage to the database. Since this can occur with both an on-premises system and a cloud-based one, it’s important to keep backup files in diversified arrangements. For example, a nonprofit organization using a cloud-based system can download their data to a backup file to be stored on-premises; that way, in the event of damage, the data is much more likely to be salvaged. Consequently, buyers should look for applications that allow them to easily download and store backup files.
Market Trends to Understand
You should consider these market trends as you select a product.
Software as a Service (SaaS). SaaS tools have become very popular. Lower upfront costs, fewer or no hardware requirements, greater accessibility and easier implementation are all reasons to consider SaaS.
Business intelligence. Reporting is one of the most important capabilities; as such, companies are constantly releasing new customization options to allow improved business intelligence. You should make sure to check the reporting options of each system.
Increased reseller specialization. Value-added resellers (VARs) and consultants, in general, are increasingly specializing in specific products for specific industries. The nonprofit sector specifically has attracted much of this specialization. As a result, nonprofits are likely to benefit as more independent software developers (ISVs) produce more third-party add-on and consulting firms offer better support services.
The Vendor Landscape
| This type of buyer... | Should evaluate these systems |
| Nonprofit organizations | FastFund Nonprofit, Sage MIP, Lawson S3 Financial Management |
| Government organizations | Sage MIP, Sage Accpac, CODA Financials, Microsoft Dynamics AX, Microsoft Dynamics NAV, Microsoft Dynamics SL |