What Is Nonprofit Accounting?
Nonprofit accounting is the way a nonprofit’s business transactions are recorded and reported. Accounting for nonprofits differs from traditional accounting in that a nonprofit has no ownership interests, has a purpose other than to earn a profit, and receives large contributions from supporters that do not expect a financial return on their investment.
For these reasons, nonprofits operate in a way that traditional for-profit organizations do not. For example, instead of equity, nonprofits record net assets in their balance sheet. Nonprofits do not have investors, making equity irrelevant. Nonprofit accounting also requires organizations to classify their net assets as being either with or without donor restrictions or with specific instructions on how the assets are to be used. Additionally, unlike for-profit companies, nonprofits run various programs that are all accounted for separately.
For more, check out Bench’s guide to nonprofit accounting.
QuickBooks & Other Nonprofit Accounting Software Solutions
- QuickBooks For Nonprofits
QuickBooks is known and loved by many specifically for its polished, no-fuss desktop and user-friendly interface. It has an impressive suite of core features including billing and invoicing, collections, cash management, fixed asset management, and even payroll capabilities.
With Kindful’s QuickBooks integration, users get all the power of QuickBooks accounting combined with Kindful’s intuitive donor database. With a two-way sync between QuickBooks and Kindful, all of your data can flow seamlessly between your donor database and your accounting software.
Aplos is a cloud-based accounting software that gets high ratings in user-friendliness and has all the features you’d expect from an effective accounting software (activity tracking, asset management, budgeting and forecasting, and more). Its ease of use makes it perfect for organizations that want to jump right in and spend little time on training.
Intacct offers users a simple layout and intuitive user experience. For those new to accounting software, Intacct provides plenty of training options at a variety of paces as well as phone and email support services. Some key features of Intacct include accounts receivable/payable, activity tracking, asset management, bank reconciliation, compliance management, partnership accounting, and purchasing and receiving.
Like its competitors, NonProfitPlus gives users all of the basic tools needed for effective accounting. However, it also offers a few nonstandard features such as volunteer tracking and board management.
Nonprofit accounting is essential to running a successful nonprofit organization. By finding software that meets the needs of your organization, you can accurately record and report every penny donated to your cause, making it easier for you to achieve your financial goals and carry out your mission.
- Accounting Tools article: Nonprofit Accounting
- Capterra article: 6 Top-Reviewed Nonprofit Accounting Software Options