QuickBooks is not just for businesses, it allows nonprofits to track donations and expenses as well. It also allows you to produce reports by grant or program or by the combined entity as a whole. Where you can satisfy the reporting needs of grantors, program managers, the board, your auditors, and yourself. Below we will walk you through what questions you should ask yourself when determining the right version for you nonprofit.
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Tech Soup suggests that even before you install QuickBooks, you should have an implementation and planning with key stakeholders that include:
- Treasurer - Board of Directors
- Program Managers
- Accounting Staff
- Your Auditor
- Development Director
- Executive Director
- IT Consultants or Staff
- Any other "stakeholder" who uses or needs financial information to perform her/his job
The main goal behind the of the implementation and planning meeting is to identify what data entered into the system should be grouped and presented for the purpose of providing useful reports
The grouped data and reports in QuickBooks will make:
- Reporting to donors, grantors, the government, and other parties faster and simpler;
- The preparation of the organization’s 990 easier and more accurate
- Audits smoother, quicker, and less stressful
- Any organizational transitions easier
- Track restricted grants more accurately and easily.
Which version of QuickBooks should your nonprofit use?
The main factors in choosing between QuickBooks Online for Nonprofits and QuickBooks Desktop for nonprofits comes down to accessibility, pricing, reporting needs, and allocation needs.
The online version allows for multiple users and access via the internet. This can be important for board members who change or when multiple people need to access a file.
Online is priced by monthly subscription and the desktop is a one-time fee. It’s recommended that you upgrade the desktop software every three years.
The online version has flexibility in creating different allocations and in tracking program, fundraising, and administrative expenses as well as restricted funds. If organizations have an outside donor management software, such as Wild Apricot or Donor Perfect, the online version can often manage these as well.
The main advantage to QuickBooks Online for Nonprofits is its remote accessibility. For a nonprofit with multiple locations the cloud-based software allows anyone with a user ID yo log in from anywhere. QuickBooks Online offers an accounting solution for a monthly fee of $20-$50 per month. It upgrades automatically and backs up automatically each evening.
QuickBooks Premier Nonprofit Edition
QuickBooks Premier is the mid-grade version of the desktop software ranges in price from $250-$500. Premier contains a larger database of reports, including the Balance Sheet by Class (missing from Pro).
Although more expensive, it is the edition best-suited for an organization that decides to use the desktop version. It is more user-friendly, and nearly completely ready out-of-the-box. The slightly higher cost can be tempered by the fact that even though a new edition is released every year, the desktop version only needs to be upgraded every 2 to 3 years.
QuickBooks Pro Edition
The desktop software retails from $170-$250. Although it is not specifically designed for nonprofits, it is adaptable to nonprofit functions and has the vast majority of features needed. Unfortunately, Pro does not have any of the nonprofit terminology. Instead of “donors” it uses the term “customer” and “Statement of Activities” is “Profit & Loss Statement.”
Pro only keeps a limited archive (usually only the last previous reconciliation) of account reconciliation reports, meaning that if you ever forgot to save an account reconciliation report, there would be no way of retrieving it.
Ultimately, every nonprofit organization is unique in its mission, programs, and accounting needs. Each individual organization must analyze its set of circumstances and bookkeeping procedures to determine which version is best for them.