2007 Review of Not for Profit Accounting Systems

From the October 2007 Issue

It’s no secret that the needs of nonprofit organizations differ tremendously from those of for-profit entities. Just how different are they? Take a look at the Office of Management and Budget (OMB) and read Circular No. A-122, where you can browse through the established Cost Principles for Nonprofit Organizations — all 48 pages.

Some of the issues the OMB circular addresses include Direct and Indirect Costs, Allocable Costs, and Indirect Allocable Costs criteria. Another issue nonprofits will soon have to address is the complete overhaul of IRS Form 990. Due to be implemented in 2008, the newly revised form will now require 15 schedules including detail on receivables from and payables to organizational officers, directors and trustees. Additionally, all non-cash contributions will need to be reported and itemized, and there will be a cap (5 percent) added to miscellaneous organizational expenses.

Click for full imageBecause of these new requirements, it will be more important than ever to have a software system in place that performs the necessary functions that nonprofit organizations require. Such functions include a solid allocations module that allows you to allocate both direct and indirect costs, perform advanced calculations, and ensure compliance with the previously mentioned OMB cost principles.

A grant administration function can also prove important, allowing users to keep a solid history of all grants, manage funds, and control budgets and future expenses. An encumbrances module will allow users to adequately plan for all future expenditures, with the added ability to track and budget expenses properly. As well, a program’s AR capability must be able to sufficiently track all customers and donors, along with maintaining a solid transaction history. Fundraising capability is also key, particularly for larger nonprofits. For those that offer products for sale, solid inventory and sales order modules are imperative. And with the additional reporting requirements that are due to be implemented in 2008 with the revised IRS Form 990, it’s more important than ever that an organization’s software track, manage, and produce the reports and other data that will be required by the federal government.

Do all of the products reviewed here offer all of these functions? The easy answer would be no. But the more detailed answer is that many nonprofits, particularly those with specialized scope, require only a small portion of the functions that many of these products offer.

Here are the review categories for the 2007 review of not-for-profit products:

Ease of Use/Flexibility
It’s important to note that, generally, the more complex a program is, the more detailed and complex the system setup will be. Though not always the case, I tried to examine general determining factors such as company setup, data- entry screens and lookup options.

Modules/Scalability
Though the majority of the programs reviewed this year are modular in scope, I looked at system function in general, along with available modules, add-ons and any other third-party applications that may work in conjunction with the product. I also considered versions available. Does it offer a single-user system? Is it better for smaller companies? Will it be able to support a growing organization?

Features & Functionality
What does the program actually do? All of these products offer strong accounting functionality, but what makes this program stand out? What makes it irresistible to the nonprofit organization?

Reporting
Reporting functionality is important to all businesses, but it’s even more important to nonprofit organizations. Some organizations have been known to change software products simply based on reporting capability (or lack thereof).

Support/Help
This area is really hard to assess until you actually need to use customer support. What I do consider here are the services available. Training is another aspect that is difficult to assess without going through a training course, etc. However, I explain the training services that are available.

Relative Value
This area lists the approximate cost of the system. Obviously, a lot of variables enter this equation, such as how many users you’ll have, the number of modules purchased and the database utilized. I recommend a visit to the vendor websites, where you’ll find extensive information, links to interactive presentations and demo downloads. No one can assess the value of a product as well as the person or organization that will be using it.

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AccuFund Inc. - AccuFund Accounting Suite
overall rating
AccuFund Inc. offers financial and accounting software solutions for nonprofit organizations as well as government entities. The latest release of the AccuFund Accounting Suite (Version 3.5) contains many enhancements to the core product.
Blackbaud, Inc. - The Financial Edge
overall rating
Blackbaud, Inc. has released version 7.7 of The Financial Edge, which is designed to provide midsize to larger nonprofit organizations with excellent accounting functionality and analytic tools to make strategic management decisions in the nonprofit arena.
Cougar Mountain Software - Cougar Mountain FUND Suite
overall rating
Cougar Mountain Software recently released Version 12 of its FUND Suite, providing small to midsize nonprofits and government entities with a comprehensive financial program. This new release contains numerous upgrades and enhancements throughout the system.
CYMA Systems, Inc. - CYMA Not-For-Profit Edition
overall rating
CYMA has recently released version 9.2 of its nonprofit software. CYMA is no newcomer to the field, having offered its software to small and midsize businesses since 1980. Version 9.2 continues this tradition with a host of new features.
Donald R. Frey - BUCS Fund Accounting
overall rating
Donald R. Frey and Company, Inc. has been designing nonprofit software for small to midsize nonprofit organizations and government entities for more than 30 years. With the release of version 10.1, BUCS continues its tradition of timely enhancements to its fund accounting software.
FUND E-Z Development Corp. - FUND E-Z Fund Accounting Software
overall rating
FUND E-Z Development Corporation has provided small to midsize nonprofit organizations with an affordable software product for over 16 years. The latest version (Version 9) of FUND E-Z continues this tradition...
Intuit - QuickBooks: Premier Nonprofit Edition 2007
overall rating
QuickBooks: Premier Nonprofit Edition 2007, one of Intuit’s vertical editions of QuickBooks, combines the convenience of QuickBooks with basic nonprofit functionality to provide smaller nonprofit organizations with an easy way to track expenses...
Kintera, Inc. - Kintera FundWare
overall rating
For over 30 years, FundWare has provided nonprofit organizations, schools and government entities with a quality accounting and financial solution. Kintera Inc. has increased FundWare’s visibility...
Sage Software - Sage MIP Fund Accounting
overall rating
Built to meet the needs of both the nonprofit and the governmental sector, Sage MIP Fund Accounting continues to enhance its popular fund accounting software. Version 8 contains several new system modules...
Sage Software Inc. - Peachtree by Sage Premium Accounting for Nonprofits 2008
overall rating
Sage Software has recently released Peachtree by Sage Premium Accounting for Nonprofits 2008. This latest version contains several additions to the core product along with enhancements to the industry-specific nonprofit edition.
Serenic Corporation - Serenic Navigator
overall rating
Serenic Navigator from Serenic Corporation is a fully integrated financial and business operations software product primarily designed for larger nonprofit organizations, international NGOs and the public sector.


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