Finding software can be overwhelming. We've helped many nonprofits choose the right nonprofit accounting software so they can record donations and set financial goals and budgets.

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Blackbaud Financial Edge NXT

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

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Recent recommendations: 3 recommendations

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AccuFund Accounting Suite

AccuFund is an online accounting and financial reporting solution designed specifically for the nonprofit industry. Integrated into one, AccuFund's Accounting suite helps nonprofit organizations and government agencies report fund... Read more

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Recent recommendations: 1 recommendations

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QuickBooks Desktop Enterprise

QuickBooks Enterprise is an accounting solution designed for SMBs across different industry verticals such as construction, nonprofit distribution, manufacturing, and retail. With QB Enterprise solution, any business owner can exp... Read more

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NetSuite

NetSuite is a business management software suite offered as a service that performs enterprise resource planning (ERP) and customer relationship management (CRM) functions. It is a horizontal package designed for an extensive rang... Read more

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Quickbooks Online

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

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Sage Intacct

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

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Adaptive Planning

Workday Adaptive Planning, founded in 2003, provides a web-based system for budgeting, forecasting and reporting. The solution is suitable for a wide variety of company sizes. Delivered over the Web in a software-as-a-service (Saa... Read more

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Aplos

Aplos is a cloud-based system designed specially to serve the needs of nonprofit and church organizations. The Aplos platform includes fund accounting, online donation management, reporting functionalities, fundraising tools, memb... Read more

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Kashoo

Kashoo is a cloud-based accounting solution that helps small business owners automate bookkeeping tasks. Using machine learning, the platform categorizes and reconciles expenses for bank and credit card transactions, providing one... Read more

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ImportOmatic

ImportOMatic is a data integration solution for Blackbaud's Raiser's Edge and Raiser's Edge NXT fundraising solutions. It is deployed as a plug-in for the Raiser’s Edge platform. ImportOMatic allows users to filter and transf... Read more

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AccountEdge

AccountEdge is an on-premise accounting and management solution compatible with both Mac and Windows operating systems. This solution is suitable for small businesses and helps users create and track sales and purchases, run payro... Read more

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MIP Fund Accounting

Purpose-built to meet the needs of the modern nonprofit and government agency, MIP Fund Accounting® empowers organizations to track by fund, manage restrictions based on unlimited funding sources, and meet complex reporting requir... Read more

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MoneyMinder

MoneyMinder is a cloud-based accounting solution designed to assist small to large non-profit organizations, sports clubs, scout groups and event planners with bookkeeping, budgeting and reporting. Features include bank reconcilia... Read more

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Denali Fund

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

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QuickBooks Online Advanced

QuickBooks Online Advanced is a cloud-based accounting solution that helps small to large enterprises manage expenses, projects, invoices and more. It comes with a centralized dashboard, which enables users to gain insights into b... Read more

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FUND EZ

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

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ZipBooks

ZipBooks is a cloud-based accounting and payment processing solution designed for small businesses and accountants. ZipBooks allows users to create customized invoices with logos, themes and messages. The online bookkeeping f... Read more

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Yearly

Yearly is a platform for nonprofits, charities, associations and foundations to create digital reports, such as annual reports. Nonprofits can create engaging and interactive reports to impress their stakeholders with Yearly.... Read more

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Serenic Navigator for NPO

Serenic Navigator is a comprehensive cloud ERP solution designed especially for non-profit organizations. As a Gold Microsoft Alliance partner for ERP, Serenic Software can help you effectively manage the financial affairs of you... Read more

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Sparkrock

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

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Buyers guide


Last Updated: June 2, 2021

Here's what we'll cover:

What Is Nonprofit Accounting Software?
Common Features of Nonprofit Accounting Software
What Type of Buyer Are You?
Benefits of Accounting Software for Nonprofits
Market Trends to Understand

What Is Nonprofit Accounting Software?

 

Nonprofit organizations, associationschurches and faith-based ministries face different challenges than their for-profit counterparts. Among these challenges are a nonprofit’s accounting needs. Rather than managing sales and revenue, nonprofits have to manage donor contributions, fundraising events, grants, investment income, membership fees etc. In addition, with limited funds for administrative tasks and strict reporting requirements, such as FAS 116 and 117, nonprofit organizations can save time and money, while reducing the likelihood of reporting errors, by implementing a nonprofit accounting system.

Common Features of Nonprofit Accounting Software

Nonprofit accounting solutions aim to help organizations manage their finances in both an accurate and transparent manner. These solutions should include accounting features that are specific to nonprofits and enable them to:

  • Manage funds and donations: Nonprofits receive funds and donations from numerous sources (individuals, organizations and websites) and locations. They have to meticulously keep track of their earnings and expenses, as they may be subjected to federal audits. Any inconsistencies in their reports can subject them to reputation damage, fines or even legal action.
  • Integrate online donations with primary fund pool: Donations from different countries via websites or payment portals, such as PayPal, need to be reflected in the nonprofit’s main fund pool and not as a separate account.
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  • Filter reports by varying transaction codes: Different transactions need to be assigned different codes for clarity and efficient fund management. Adding filters to expense and earnings reports will help users easily view these different transactions and provide clarity into how funds are used.
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  • Generate reports in multiple formats: Nonprofits need to be able to create and present reports in a variety of different formats, such as Excel files or PDFs. This is because most volunteers are not proficient in accounting and thus need to view reports in familiar, easy-to-use formats.
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  • Convert donations in multiple currencies: Donations or funds received in different currencies need to be integrated with the nonprofit’s primary account and converted automatically.

What Type of Buyer Are You?

Identifying what type of buyer you are can help you choose the right solution. You should be aware of your unique needs and pay only for the features you deem necessary. Many buyers mistakenly pay for solutions that offer a plethora of features that they rarely use. Common buyers of nonprofit accounting software include:

  • Nonprofit or voluntary organizations: These organizations depend solely on volunteer donations and sometimes receive corporate funding. Their primary expense is implementing social welfare programs and initiatives.
  • Charities: These can be privately or publically funded organizations that work toward a single cause. These organizations receive donations from many different sources, and thus must establish a single fund for all their expenses.
  • Churches: Funding is received primarily in the form of weekly collections and member donations. Since accounting is primarily managed by church attendees, churches need a solution that offers a simple, easy to use interface.
  • Private schools, colleges and universities: These institutions receive state or federal funding, private donations and tuition fees. In addition to managing funds, they need to allocate resources toward staff incomes, administrative costs, maintenance, promotions and/or advertisements and other daily expenses. Most schools have in-house accountants, so their needs are more complex and varied, which means they will likely seek a more robust nonprofit accounting solution.

Benefits of Accounting Software for Nonprofits

Nonprofit accounting solutions provide organizations of all sizes the tools they need to manage income and expenses efficiently. As nonprofits are subject to federal audits, it’s important to accurately record all of an organization’s financial details. Therefore, these systems track an organization’s donations, grants, expenses, assets and transactions. Their focus in on maintaining a healthy balance between receiving donations and spending funds on welfare activities.

Similar to nonprofit accounting software, nonprofit financial software (sometimes called fund accounting software), helps achieve fiscal transparency, ensure federal reporting standards are met, maximizes donor dollars and minimizes unnecessary expenses.

Accounts in Blackbaud Financial Edge

Accounts in Blackbaud Financial Edge

These features work together so a nonprofit organization can make the most of their assets, maintain fiscal visibility, nourish their reputation and acquire lasting trust from supporters.

Market Trends to Understand

At the end of each fiscal year, nonprofit accounting regulations and end-of-year acquisitions and partnerships often become newsworthy topics. There is increased scrutiny around their operations and they are under pressure to ensure transparency, lest their funding be affected due to accounting inaccuracies.

Here are some important trends to know about:

Keep fund ledgers separate. Nonprofits must keep different ledgers for all of their fund sources: direct donations, grant monies, fundraising dollars, pledges etc. Nonprofit accounting software independently tracks fund sources and expense types, simplifying reports and ensuring accuracy.

Prioritize expenditures. Ledger reports provide a holistic overview of an organization’s financial landscape. This allows an organization to strategically prioritize future investments and upcoming expenses.

Document and meet budget goals. Having a holistic picture of an organization’s entire financial portfolio allows board members to create realistic budgets and meet associated goals.

Simplify tax preparation. Many nonprofit accounting solutions include features that prepare the Form 990—a tax form requiring certain federal tax-exempt organizations to file with the IRS.

Reinforce trust in your organization. Transparency in an organization’s financial data shows current and prospective donors how their dollars are utilized.

Prevent fraud or errors. Omissions or errors may occur due to internal deficiencies. Therefore, nonprofits should stick to the legal definitions of what constitutes contributions (revenues, gains, gifts or transfer of assets), donated services and expenses (fundraising and management).

Understanding these trends and taking appropriate steps can help a nonprofit organization maximize their available assets, ensure fiscal transparency, boost its reputation and build trust. The right nonprofit accounting software will address all of an organization’s accounting needs. Daily operations also have to be run efficiently, as the goal of a nonprofit organization is benefit the community in which they operate. For more information on software especially for nonprofit organizations, read our nonprofit buyer's guide