The Best Fund Accounting Software Options Your Nonprofit Shouldn’t Overlook
For nonprofits, finding success can come with serious growing pains. When a small nonprofit takes off, it’s not unusual for managers to realize they have more donors and transactions than they can handle with their current accounting tool.
The same also goes for medium-sized or larger nonprofits that receive a sudden, unexpected boost in visibility or attention — leading to an increase in revenue, but also new accounting troubles.
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Dedicated nonprofit accounting software can be a significant asset for nonprofits struggling to manage donor money. Different nonprofits have different needs, however, and the most popular tool isn’t necessarily the best fit for an organization.
These are five of the best fund accounting software options for nonprofits that many organizations overlook — and why your nonprofit may want to give them a shot.
MIP is an all-in-one fund accounting tool for nonprofits, good for organizations of all sizes.
The platform includes basic fund accounting and org management capabilities that will help a nonprofit manage accounting, HR and payroll. The tool also makes it easy to import and export financial data, ensuring that accountants can use existing budget data.
Importantly for nonprofits, MIP also includes a range of features that will help with fund accounting. Unlimited budgets and forecasting tools will help you better manage expenses and plan spending. Integration with tools like the fundraising platform Elevate means that you can also extend the functionality of MIP with other nonprofit solutions as needed.
For nonprofits that need a robust accounting tool, an all-in-one fund accounting solution like MIP can be a great fit.
Zoho Books, developed by Zoho Corporation, which specializes in IT management tools and productivity software, is a surprisingly effective accounting solution for small businesses and nonprofits.
The web-based tool includes a range of basic accounting features, reporting tools and a highly user-friendly UI. While it may not be a great fit for larger organizations — which will have to pay more based on the number of accountants they have — it is likely one of the better available tools for small nonprofits.
There are some limitations to the product, however, that nonprofits will have to navigate around. For example, Zoho Books’ integrated payroll features are only intended for use by organizations incorporated in one of three states — Texas, California and New York.
The tool also doesn’t provide native integration support for third-party payroll tools — meaning that you may have some difficulty coordinating Zoho Books with your payroll management solution.
The website will likely work best for smaller nonprofits who aren’t too worried about these limitations. Despite these drawbacks, Zoho Books is a surprisingly effective tool that provides serious resources to users and is competitive with some of the biggest accounting platforms out there.
For larger nonprofits that need a dedicated accounting tool, NonProfitPlus is one of the better available options.
NonProfitPlus is a business management and enterprise resource planning solution that is designed specifically for nonprofits. The tool is built to offer nonprofits all the tools they need to handle reporting and compliance. Features include basic reporting and financial tracking tools, as well as functionality that will support donor and fund management.
The tool, however, is not as affordable as many other options, and the cost of the basic plan may be out of reach for some smaller nonprofits. Medium-sized and larger orgs that are willing to invest in the tool may find that the advanced features tailored to the needs of nonprofits are worth the extra cost.
Xero is built more for small businesses than it is for nonprofits, but the tool is still a valuable option for smaller organizations that need dedicated accounting software.
Users can quickly import budgets from spreadsheets or create new budgets from scratch. Like other tools, it offers a strong foundation for any nonprofit’s budget. Features like financial report generation, transaction reports and budget filters will help accountants to more quickly manage organizational income and expenses.
Unlike other tools, Xero doesn’t provide specific donation or fundraising tools, but the existing suite of features the software offers can work for tracking donations.
The tool may not be a good fit for larger nonprofits with more complex accounting needs. For smaller organizations who need to upgrade to an entry-level solution, however, it may be a great fit.
Denali Fund is another option for small to medium nonprofits looking for an accounting tool with fund accounting functionality.
The tool features key accounting and management capabilities, including support for fund management, reporting, payroll and documentation management.
Denali Fund doesn’t offer support for donor management by default, but it does offer integration for Donor Express. The tool also offers integration with a number of ecommerce and business intelligence tools.
For nonprofits willing to adopt multiple solutions to handle accounting and donor management, this may not be a dealbreaker. However, it could be an issue for orgs wanting an all-in-one accounting solution or a more streamlined tech workflow.
Don’t Miss Out on These Fund Accounting Software Options
For nonprofits that want options outside of the big-name fund accounting tools, these options are some of the most useful.
While some will be better for smaller and newer organizations than others, each of these tools provides functionality that will help the org stay on top of budgeting and reporting.
Smaller nonprofits may benefit the most from general-purpose accounting tools like Zoho Books and Xero, which aren’t designed for nonprofits but still provide features necessary for nonprofit accounting.
Larger organizations in need of a more dedicated tool may want to turn to a solution like NonProfitPlus. Some tools — like MIP and Denali — can be effective for organizations of all sizes.