Updated: Oct 17
Our network C.P.A., Andrew Melton, discussed the basic overview of Nonprofit Financial Management and how to organize the functional areas (governance, programs, and administrative) and staff responsibilities of your organization, replay is available in the Collective Impact App under the Impact Toolkit tab.
Rightfully so, the title “Accounting Systems and Organizational Structures” sounds intimidating. Our goal at Collective Impact is to help our audience overcome internal and external barriers preventing N.P.O. from being successful. Lack of financial accountability is one of the many barriers that affect nonprofits primarily led by people of color. Don't stress, below are a few tips to help you better understand how to implement accounting systems and organizational structures to improve your organization's internal impact.
#1 Strategically select a Board Treasurer that you trust and has experience with bookkeeping or accounting background.
A nonprofit treasurer typically takes on the following responsibilities:
Reconciles bank accounts and produces financial statements, which they present at board meetings
Ensures tax-related documents and legal forms are filed on time, such as the documents required to maintain the organization's tax-exempt status
Serves as chair of the finance committee and financial officer of the organization
Manages, with the finance committee, the board's review of and action on its financial responsibilities
Assists the chief executive or the chief financial officer in preparing the annual budget and presenting it to the board for approval
Reviews the annual audit and answers board members' questions
As the nonprofit Founder or C.E.O., you have many things to do and manage. For organizations to impact the community, you must have a working board that brings their skills to the table. Utilize your board treasurer to the fullest and save yourself a headache. Later this week, we'll focus more on organizational structure and break down the responsibilities of all board and staff members.
#2 Record EVERY transaction(expense/donations)
Even if you are self-funding your organization, you need to maintain a paper trail. Only use the organization's bank account to pay for expenses and receive donations. If paying cash, deposit in the bank account before making a transaction.
Most accounting software's like QuickBooks and or Waverly can link to the nonprofit's bank account; you have to reconcile (categorize) the transactions. (Ex., Funder's investment)