QuickBooks for Non-Profits – Learn how NGO’s Accounting Software works for an organisation in Nigeria with typical tips on how to track revenue, manage expenditures and ascertain surplus or deficit.
We understand that, as a non-profit making organization whose core objective is not to make profits but extend social benefits to your immediate environment, one major area you will definitely want to get right is the accounting system; a sub-part of your operation that focuses on tracking, recording accurate bookkeeping of cash inflows and outflows in order to have a good grasp on how your organization’s financial positions are, for effective decision making.
Recently, a staff of a well-known international NGO plainly requested QuickBooks Enterprise so they can organize their finances and see how funds are being utilized.
What is QuickBooks Enterprise? QuickBooks Enterprise is the most robust of all the versions of QuickBooks designed to cater for growing and expanding businesses that own multiple warehouses for stock keeping, requires more than 5 and up to 30 users’ license to work on a central data file. From our experience, we don’t advise clients in the non-governmental sector to buy this version of QuickBooks; we see it as a complete waste of money except you want 10 users licenses or more; the right QuickBooks NGOs need to run their account effectively is the updated Professional Edition, also known as QuickBooks Pro or Premier software.
NGOs are organizations that don’t buy inventories nor sell to customers – they are strictly established to help finance social projects that will impact targeted communities. All incoming funds coming from corporate and individual donors are channelled to different activities and accountability is required.
In this post, I will be sharing my experience and how I have successfully implemented QuickBooks for several NGOs in Lagos, Abuja and Portharcourt, both on a remote cloud server, in-premier infrastructure or online.
Even though these are multiple options we explore, the scope of setup and configuration of company files are the same.
According to the finance manager, they are funded by local and international donors and as such would love to input these donors and their profile to QuickBooks.
Some of the expectations are that funds wired from abroad into their domiciliary account should be accounted for, monthly or yearly. This means they’d to record all the US dollars, Euro or GBP receipt as donation or grants in their relevant bank accounts with financial accounting software providing seamless reports of cash inflows in their local currency equivalent (Nigeria Naira)
Every expense incurred with the receipts, after it has been transferred to a local bank account, will also be tracked and how well they are utilized on multiple social projects.
Since we have implemented QuickBooks for several NGOs in Nigeria, it’s normal for us to confirm the suitability of QuickBooks and assure the client that the proposed project was an exception only that their transaction workflows start from foreign currencies and end up as local currency expenses.
Here is a step by step guide to setting QuickBooks for NGOs like this:
Firstly, add all the donors and their details into the system and assign the appropriate currencies donations or grants from them are received into your bank account; for instance, if I add all the foreign donors, I will select EURO, USD or GBP to their currency, let’s I say WorldBank is a key donor to an NGO and they support local causes with dollar donations, it means that WorldBank will be added as a donor and USD assigned to their currencies; this is very important so that you can track all foreign funds coming at every point in time.
Whenever there is an inflow into the NGO’s domiciliary account, the receipt window is used to record all, while the transfer fund lets you move the fund to a local currency bank for disbursement to relevant cost centers.
You will also do the same for local donors, except that their currency is Naira.
Listed here is the summary of how QuickBooks software can work for a Non-Profit Making organization.
- Income – In QuickBooks, you can set up your income channels like Donations, Corporate Sponsorship, Membership Subscriptions, etc as an item that will appear on receipt and invoice generated.
- Expenses – QuickBooks has thousands of expenses type you can choose from when recording your daily, weekly, or monthly expenses – From Staff salaries, Rents, Office Supplies, Miscellaneous Expenses, or even add your own customized expense types.
- Financial Report – You can generate weekly, monthly, or yearly financial reports of your organization’s activities, track financial performance via Income and Expenditure report, monitor Cash Flow, and view your financial position.
- Document/Report Customization – You can even customize electronic source documents – receipts or invoices to suit your organization’s style and add your organization’s logo to the financial report.
- The software also tracks all investment by NGOs to profit-generating activities like the acquisition of assets for business purposes, investing in the financial market, e.t.c
For more information on how we can help you set up QuickBooks for your Non-Profit organization, send a mail to info@accountingsoftware.com.ng or call – 08084219399