Two recent surveys highlight some of the biggest challenges facing accounting and finance professionals in the nonprofit industry.
Time is money, as the old adage goes. And findings from two new industry surveys of nonprofit finance and accounting professionals illustrate that outdated technology, interruptions from other departments, and small staffs may be costing these professionals a lot of time and, ultimately, costing their organizations a lot of money.
When it comes to technology, for example, the “2015-2016 Nonprofit Accounting Insights and Analysis Survey” [PDF] from financial solutions provider AccuFund, Inc., found that limitations in financial software—such as inabilities to customize dashboards and to store and report on nonfinancial performance data—often lead to inefficiencies.
Fifty-five percent of the nearly 300 surveyed nonprofit professionals reported that their current financial software dashboard is not customizable for individual users. And more than 50 percent reported that their software did not include graphical analytics.
By giving data to the people in a visual way, the business people in an association have a chance to emulate some of the wisdom that used to take decades to get.
These numbers are striking, given the ever-increasing importance of business intelligence and data analysis.
Data graphics can help level the playing field for employees across an organization and can dramatically speed up the time it takes to make decisions, Debbie King, COO of DSK Solutions, Inc., told Associations Now. “By giving data to the people in a visual way, the business people in an association have a chance to emulate some of the wisdom that used to take decades to get.”
Meanwhile, nonprofit technology firm Abila, which recently published the results of its “Nonprofit Finance and Accounting Study” [PDF], found that many nonprofit finance departments are missing another opportunity afforded by technology advancements.
The survey found that while 62 percent of nonprofits are moving to cloud technologies, those same organizations’ finance departments have not been as quick to make the move. And it’s not that finance professionals don’t realize the potential of cloud-based technology: Most of the 350 surveyed respondents reported it is as cost effective, efficient, and easy to use.
For the Healthcare Businesswomen’s Association, moving its accounting services to the cloud three years ago helped alleviate some logistical constraints of their former decentralized spreadsheet system. It also gave association staff greater peace of mind as its volunteers, who turn over frequently, have access to the system.
“We no longer have to wait to find out when the bank statement comes out at the end of the month that somebody has drained $25,000 from the account,” Nikki Jones, then HBA’s director of finance and administration, told Associations Now. “We can immediately get to that and cut that off.”
Another big advantage of the cloud is the flexibility it offers users to work remotely, which could help organizations with recruitment efforts as telecommuting has become an important employee benefit.
Lean finance staffs are the reality for 80 percent of nonprofits, according to the Abila study, and according to the AccuFund survey, 95 percent of nonprofits had between one to five accounting staff. Smaller teams make it harder to meet demands, such as pulling financial reports.
Increasing finance and accounting staff may not be the only solution, though. Nonprofits could also invest in technology that would allow other departments to look up their own financial reports in order to better meet demands and to cut down on interruptions—the number-one challenge respondents to the Abila study said they faced.
“If we can allow those folks to self-serve that reporting versus having to go through the finance and accounting department, then we’ve suddenly created an additional hour, two hours per day for them and the financial accounting groups to formulate and execute the strategy that will ensure the ongoing success of the organization,” Abila’s director of product marketing, Erika May McNichol, said in an interview with Associations Now last week.
What challenges do you face as an association accounting or financial professional? Please share in the comments.