It often feels like platforms like Xero were made with only businesses in mind, but there absolutely is accounting software for charities out there.
If you know how to use even the most popular accounting software for businesses inside and out, everything you could need for your charity will be right at your fingertips.
For the unconvinced, here is our definitive guide to accounting software for charities, from the benefits to some of the platforms that are most likely to benefit you.
What is accounting software, and what are the benefits for charities?
Accounting software is something that almost every charity needs, but not all are aware of the benefits it offers – primarily helping you keep track of all the financial information and data of your charity.
By providing a clear picture of all the data you need to know – how much each donor donated, for instance, or what percentage of income went to administrative costs, etc. – you’ll be put back in charge of your charity and never have to make a decision without all the information.
Accounting software can also reduce the amount of time required for bookkeeping and increase the accuracy of your financial figures. A lot of packages also allow you to scan documents straight into the programme, too, saving you even more time.
A lot of software providers have you in mind, too, and therefore provide reports that are wholly appropriate for non-accounting professionals to use to review where their money has gone.
Accountants can still see that data, however, and in real-time, which makes discussions and meetings with your financial advisers far more productive and efficient.
Which software should you choose?
There are different types of accounting software for charities to pick from, which will primarily depend on their size and time. As well as standard packages for anyone to use, there are also specific ones that are tailored to non–profit organisations.
While looking for a package, it’s important to consider your organisation’s crucial features. The features to look out for are:
- tracking donations and expenses
- restricted funds or fund accounting
- tracking gift aid
- generating reports
- creating invoices
- payroll
- receipt scanning
- bank feeds.
Once you’ve identified what you need as an absolute must, you can begin comparing different accounting software packages.
In our opinion, you would be wise to check out QuickBooks, FreshBooks, Xero and Sage.
Restricted funds for charities and accounting software
Many non-profit organisations and charities need restricted funds or fund accounting. These are funds the trustee of a charity must spend in a specific way as agreed with the donor.
Accounting software can help keep meticulous track of restricted funds by providing accurate reports on money donated and how it’s being used – increasing transparency for all users in the organisation.
This is likely to be an especially important point for when you’re looking for the right programme for your organisation, so don’t hesitate to reach out to us for help.