It used to be that nonprofit accounting was the staid uncle of applications, with not much changing from year to year. That’s simply not true anymore, with vendors of nonprofit software working hard to keep up with the changing times, changing regulations and reporting requirements, and for the most part, incorporating technology just as rapidly as those vendors who offer other, more mainstream, software applications.
To keep you up to date with what’s happened in the past year, and where the industry is headed, we surveyed 14 popular vendors of nonprofit accounting software.
KEEPING UP WITH UPDATES
Almost all the vendors we surveyed told us that they performed upgrades — some minor, but many fairly significant. For example, Red Wing Software released its CenterPoint Fund Accounting, and AccuFund released Version 6.01 of its AccuFund Accounting Suite, which offers a major change to the interface to make it consistent with current tech standards. AccuFund also released mobile access for work orders, according to president Peter Stam.
Meanwhile, Open Systems added an allocations module that was a significant enhancement to the NFP suite, and is also working on its user interface. “The most significant improvements will be seen in the user interface and mobile realm on the front-end. We are making significant investment in defining workflows that will make Traverse even more intuitive,” Open Systems vice president of corporate development Paul Lundquist said.
Sage Intacct launched its Nonprofit Financial Board Book powered by GuideStar. The book is built on the Sage Intacct platform and incorporates the best practice metrics and insights that GuideStar uses to demonstrate nonprofits’ financial health. It uses real-time transactional data from the system of record to automate the calculation of key financial and operational metrics that are important to a nonprofit’s organizational health.
Fund E-Z Development Corp. put its efforts into other areas, said vice president of sales George Marcolini. These included closer integration to Excel, with a live link between cells in Excel and balances in Fund E-Z such that clients can build reports once and then have them updated in real time; the addition of a Fixed Assets module; and an enhanced “hands-off” job scheduler that can execute reports, exports, imports and e-mail reports on a schedule set by the user. Fund E-Z can also now prevent the saving of transactions that would result in going over budget.
A significant update also took place at Oracle NetSuite. “We released the NetSuite Nonprofit SuiteSuccess MidMarket Edition. This edition pre-configures leading practices for operating a nonprofit on NetSuite software that were derived from the experiences of over 1,000 nonprofit customers,” said Maggie Tallman, vertical product manager for nonprofits. “Key feature improvements for nonprofits in this edition include custom roles, dashboards and KPIs, grant accounting, fund accounting, automated FASB reporting, simplified financial segmentation, and program efficiency tracking.”
According to Aplos’ head of revenue, Christy Qualle, “We focused on adding features to the accounting section that addressed some of the needs of our accountants who manage clients and organizations that are growing and have more established fundraising needs. These included period close for accountants to lock down transactions after an accountant has reviewed, adding a new bank integration provider to enhance the user experience, the ability to e-mail contribution statements to donors, pledge tracking for nonprofits, and enhancing accounts receivable statements to improve billing processes for private schools.”
According to Michael Blanton, director of product marketing for Blackbaud Financial Solutions, “In addition to the simple, no-setup, interactive analysis tools in our prebuilt dashboards, we are soon launching SKY Reporting that supports user-defined creation and distribution of dashboards specifically relevant to an organization’s reporting needs.”
MORE THAN JUST ACCOUNTING?
Vendors were mixed on offering other applications in addition to financial accounting. The most frequently offered additional application was donor management, though not everyone agreed. According to Red Wing Software marketing manager Stephanie Elsen, payroll software is the only ancillary product they provide, along with CenterPoint Fund Accounting. And while QuickBooks does not offer donor management software, it does have multiple third-party solutions available that offer donor management solutions and integrate with QuickBooks Desktop, according to product manager Nithya Hariharan.
Partnering seems to be a common approach to offering ancillary applications. “Our new API standards are making it much easier to integrate. With donor management, we are much better off using our integration options versus writing a package. We realize that organizations who focus efforts on such applications are better at it and we are better at integrating with them for those specific functions,” said Open Systems’ Lundquist.
But other vendors feel that having a donor management system is a must. As Joseph Scarano, CEO of Araize Inc., said, “Most nonprofits rely on raising funds from donors to help fulfill their mission and provide working capital; therefore, we feel it is a vital part of their fiscal management.”
Extending their portfolio beyond financial accounting is a sentiment that is echoed by Abila, among many others. “Donor management is key to our nonprofit strategy,” according to Dan Murphy, senior product manager of Abila MIP and MIP Advance at Community Brands. “We currently offer a donor management solution integration with our Abila MIP Fund Accounting solution.”
Aplos’ Qualle echoed that: “For us, having an all-in-one solution is essential so that the most important data all lives in one place. There is less time spent doing data entry, fewer errors in having to manually track things, and the reporting that the organization receives can be more dynamic.”
And while Cougar Mountain Software does not have a donor management application of its own, it has a direct integration with Donor Express, and a partnership with MaxGiving for its fundraising solution, according to senior account executive Kristine Terrell.
A number of vendors offer complete ERP systems that go beyond a simple general ledger. According to AccuFund’s Stam, “We offer a full ERP system including purchasing, grant management, client accounting, and payroll and human resource solutions, all of which are closely integrated with the financial core.” And Oracle NetSuite provides cloud financials along with CRM, e-commerce, human resources and professional services automation management.
While payroll and similar applications are fairly common, Grants Management Systems has a somewhat unusual application. As president Donald Cassady told us, “Beyond the GMS Accounting Financial Management System, we offer Revolving Loan Servicing Software. The GMS-RLSS is a comprehensive portfolio management tool that can handle virtually any loan program.”
ACCOUNTING ON THE RUN
Despite the ubiquity of smart mobile devices, a number of nonprofit accounting software vendors, including Red Wing and GMS, said that they had not seen any demand for iOS or Android mobile apps for their products.
Yet others felt strongly about on-the-go access. Several, including Aplos and Ariaze, are cloud-based to begin with, and require Internet access to be able to use the application, therefore supporting mobile access through a Web browser. “The FastFund Online system is a true SaaS application that works from any computer, Windows, Mac, or tablet device that can connect to the Internet,” said Araize’s Scarano.
NetSuite’s Tallman added, “Mobile access is critical. NetSuite’s mobile app features easy expense reporting, call logging and time tracking in a mobile interface filled with mobile dashboard portlets and KPIs.”
ALEXA, WHAT’S MY CASH ON HAND?
Machine intelligence and AI are hot topics in the technology world, but not all of the vendors we surveyed are going down that road quite yet. Red Wing Software’s Elsen explained that they are not getting any requests in this area. And AccuFund’s Stam said, “Not at this point. We will be looking for future opportunities where machine intelligence will be useful for evaluating status of items and notifying the appropriate individuals, such as when cash is low or AR balances are becoming too high or too old.”
Yet several vendors told us they were working on ways to incorporate machine intelligence and/or advanced analytics into their applications. Aplos’ Qualle said, “Automation is a very helpful feature for nonprofits since they are often short on time, but since there is so much variety among nonprofits, it is important to allow them to customize their own experience. We automate some communications, like donation receipts that the user can customize. We also build in a variety of dashboards that use their data to make suggestions about important next steps they may want to take, like welcoming a new donor or following up with a supporter that has become inactive.”
And Open Systems, Serenic Software and Sage Intacct are all working on some form of business analytics applications. Joan Benson, nonprofit industry marketing executive at Sage Intacct, said that the company “is developing AI and machine learning to incorporate into the product.” At a recent user conference it introduced an AI bot called Pacioli that could “transform the way finance professionals think and work.”
Open Systems is also offering software in this area. According to Lundquist, “We are rolling out a brand-new offering entitled ‘Advanced Analytics’ for the Traverse framework. This tool allows the user unlimited BI users to tap into the ERP system for a variety of metrics. All information is automatically available on a mobile device with responsive design.”
Serenic has an entrant in this area as well. Director Ruby Bleiker said, “Serenic Analytics is a robust analytics and dashboard tool that provides management control and displays critical operational information in meaningful, easily understood formats while doing so quickly. To keep the nonprofit running smoothly amid the inevitable operational changes and adjustments, managers and executives need a complete view of the organization, with the appropriate level of detail at their fingertips.”
A ROADMAP FOR TOMORROW?
The last question we asked was where the vendors envision the industry moving over the next few years.
Open Systems’ Lundquist told us he is seeing more consolidation within their NFP clients: “This results in larger entities who have larger needs for financial reporting. We are also seeing more regulation, which results in additional needs to get at the data for analytic reporting and decision-making.”
GMS’s Cassady agreed: “With the increase of mergers, the scope of the accounting professional has changed. They now must have the ability to analyze financial and service reports to ensure that the larger nonprofits are providing the maximum amount of services they can, as well as following the proper accounting principles.”
AccuFund’s Stam noted the need for more, better data: “I think in general the accounting has become more rigorous and open as newer program staff expect more current and accurate data. Funders are expecting more information more frequently, as they expect current-generation systems to be more accurate, more timely and more accessible.”
Oracle NetSuite’s Tallman offered a different vision. “We see accounting transforming from an exercise in compliance into the primary indicator of organizational performance and future sustainability,” she said.
Serenic’s Bleiker pointed out that not-for-profits will have to do more with less, while Cougar Mountain Software’s Terrrell feels like the nonprofit industry is moving toward more transparency and accountability. Features such as individual user rights, role-based access and secure audit trails will become more important in the future.
Regardless of their individual visions, one overall expectation is clear. All of the vendors expect that tomorrow’s nonprofit accounting software is going to be different, more sophisticated, and easier to use than it is today. And that’s something to look forward to.
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