Can you access the information you need in your accounting software, and create useful reports, pay stubs or invoices? The accounting software you use can make your work easier—and it doesn't have to cost a fortune. QuickBooks, Peachtree and Fund E-Z are all affordable packages that can help you get your books in order.
Every nonprofit can benefit from accounting software. Even small organizations that make only a few basic deposits, withdrawals and invoices a month will quickly exceed the capabilities of an application like Microsoft Excel. Truth be told, Excel is dangerous as an accounting tool, as there are no built-in safeguards to keep you from deleting a transaction or accidentally duplicating a line on a report.
Learning to use new accounting software can be daunting, but in the long run it will save you a considerable amount of time. Most accounting packages allow you to create new reports, like a cash-flow summary or information for your
Form 990, at the touch of a button, and many will update your accounts automatically when you write a check or create an invoice.
An accounting package is a useful tool, but it won't make you an accountant. Think of it as a filing cabinet: you need the cabinet to hold your files, but you still have to set up a filing system. If you don't have an accounting background, you may want to hire a consultant or bookkeeper to help set up the software and define how you should use it—expect this to cost two to five times the price of the accounting package.
Happily, affordable accounting software options do exist. Starting at only a few hundred dollars, packages such as those below are recommended for organizations of up to a couple accounting users, several programs, and annual budgets up to $1 million—although many very small nonprofits with budgets below $50,000 use them as well.
QuickBooks starts at around $230 for the most basic version and costs about $400 for a multi-user version with more features. Intuit also offers online versions starting at $13 a month for the entry-level edition, rising to $64 a month for the most full-featured option. The market leader in entry-level accounting software, QuickBooks is specifically intended for small business without much accounting experience. The system is relatively easy to get up and running, which can be a draw for small nonprofits, but accounting-savvy users might chafe at its lack of an audit trail and limited customizability.
Like QuickBooks, the widely used Peachtree comes in a variety of differently priced forms, beginning at about $70 for a basic version and running to around $1,000 for a more sophisticated multi-user version. However, Peachtree offers more flexibility than QuickBooks, allowing you to set up reports and accounting charts exactly the way you’d like—which is why those with accounting backgrounds tend to prefer it. It’s not as ready to use “out of the box,” however, and users are expected to have basic accounting experience. For this reason, it may not be the best choice for accounting novices.
Although it requires a bit more of an initial investment (around $1,000 for one user, including support), FundEZ is intended specifically for nonprofits and allows more flexibility than QuickBooks or Peachtree in tracking restricted funds and creating nonprofit-specific reports.
As with any software package, start by understanding your needs—including the accounting procedures you will follow. If no one at your organization has accounting expertise, you may need to ask an outside expert to help with this. Before making any decisions, talk to vendors and look at the tools, download trial versions if available, and talk to other organizations that use them to understand how well the applications can support your needs.
Even the best system won’t do your taxes or bookkeeping for you, but the right one will make those tasks a lot easier.
