You have set up a new non-profit and you’re eager to get started on your organization’s mission. At the beginning of your non-profit, you may be tempted to keep your team entirely in-house, for everything from your outreach personnel to your accounting processes. However, outsourcing finance and accounting roles actually end up bringing many benefits to a new non-profit.
Gain More Time to Focus on Your Mission
Does your non-profit’s core mission revolve around finance or accounting? Chances are, you are dedicated to a cause that has nothing to do with these two areas. Your expertise is elsewhere.
Your organization needs to have a good handle on its finances from the very start. Processes that you handle yourself at the beginning of your non-profit’s journey may be completely unsustainable as you grow.
Depending on volunteer labor for mission-critical back-office tasks is also a poor choice. Accounting and finance duties are so important to the ongoing success of your organization that any interruption due to volunteer turnover could put you in a bad situation.
When you outsource these tasks, you get that off your plate so you can focus on the areas that you excel at.
Access to Specialized Knowledge and Technology
An accounting and finance service provider’s core business revolves around being the best in these areas. They have years of education and certifications, purpose-built technology and a lot of hands-on experience in non-profit financial concerns. When you hire them, you’re paying to get access to these benefits as well.
Improve Accounting Transparency
Your donors want to know how you’re using the money and resources that they donate. If it’s difficult or impossible to figure that out, you could end up losing donations and failing to encourage larger contributions.
Accounting and finance services give you accurate information on your incoming and outgoing funds. You can plan your donation requests around this data, such as putting out a plea when your predicted cash flow starts to taper off.
Your annual reports and tax filings become a lot easier too. You have all the information ready for you, and the service provider may be able to help out in these areas.
Hiring part or full-time staff for an in-house accounting team would take up a lot of your new non-profit’s funds. You may have to rely on mostly volunteer work for the first few months or years, so being able to afford the salary and overhead costs for an employee are beyond your resources.
The finance and accounting service has a cost-effective pricing structure, as you pay for the times that you need them. You’re not responsible for buying their equipment, paying for their insurance or covering a benefits package.
This on-demand model makes sense during the beginning phase of the non-profit, as you won’t have the same accounting requirements that you would 20 years in the future. At that point, you may want to reconsider whether you get more out of an in-house person.
Non-profit founders often try to take on all types of specialized tasks when they don’t have those skills in-house. However, proper accounting is a must-have for any size non-profit organization. Working with a service provider or firm for your accounting and finance needs saves you a lot of headaches in the long run. You can use them for taxes, reporting and everything in between.
For ways for Non-Profits to save money through Cloud Integration, see our recent post.