Key points covered in this article:

  • Nonprofit accounting software should streamline daily operations, improve financial visibility, and enhance data protection while supporting scalability for future growth.
  • Tools like QuickBooks Online and Sage Intacct offer tailored solutions for nonprofits, with features ranging from basic accounting to advanced reporting and automation.
  • Choosing the right software and ensuring proper setup can lead to stronger reporting, smoother operations, and better decision-making for nonprofit leaders.

 

Accounting software can support nonprofit organizations in several important ways. It can improve financial visibility, help staff manage grants and restricted funds more accurately, and make reporting more efficient. It can also reduce manual work and give leadership clearer information for planning and oversight.

For many nonprofit leaders, the harder part is knowing where to start. They may sense that the current system is no longer keeping up, but still be unsure what a better fit looks like or which options nonprofit accounting professionals typically recommend. Understanding what to look for and how to get the most value is often the first step to a successful software upgrade or transition.

Choosing the Right Nonprofit Accounting Software

When looking for accounting software, nonprofit leaders often ask what accounting software nonprofit accountants use. But the answer depends on the organization. It’s not one-size-fits-all.

Common accounting software options include:

  • QuickBooks Online for nonprofits is a cloud-based system setup for basic accounting needs. It also connects with a wide-range of third-party tools for bill pay, payroll, and expense tracking.
  • Sage Intacct for nonprofits is more robust and generally a stronger fit for more complex nonprofits. It offers deeper visibility across funds, grants, programs, locations, or entities, along with stronger reporting, automation, and more room to scale.

What to Look for in Nonprofit Accounting Software

From there, nonprofit leaders will want to evaluate software against the same core criteria.

Support for Daily Operations — Many nonprofits know the frustration of moving between spreadsheets, donor platforms, bill pay tools, payroll systems, and accounting software just to complete routine tasks. A recent survey found that 61% of nonprofit professionals rely on spreadsheets rather than automated solutions, and many also reported limited sharing of financial data between departments, even with accounting software available. A platform should reduce that friction and make operations more efficient. Look for a system that tracks funds, grants, expenses, and reporting requirements consistently, integrates with the existing tech stack, and reduces the manual entry for staff.

Reporting and Visibility — Leadership needs timely financial information to monitor budgets, track restricted funds, and respond to problems before they grow. Yet many nonprofits struggle in this area. Another survey found that up to 34% of nonprofit respondents said they lacked real-time visibility into key metrics and performance. A strong platform should produce budget-to-actual reporting by fund or program, grant reports that match funder requirements, dashboards, and financial summaries that show where attention is needed. The goal is information leadership can act on, not just more data.

Data Protection — Nonprofits are increasingly frequent targets for cybersecurity threats, and donors consistently rank the protection of personal information as highly important. A platform should include encryption, regular backups, role-based access, audit trails, and vendor-managed security updates, and nonprofits should have traditional internal controls in place as well. All of these features reduce the risk of a data breach or unauthorized activity and need to be evaluated carefully before committing to any system.

Scalability — Software choices affect more than current operations. They also determine whether a nonprofit can handle added programs, more grants, staffing changes, or new reporting demands in the future. The goal is not just a system that works today, but one that continues to support the organization as it grows.

Unlocking More Value from the Software

Knowing what to look for is one thing. Getting the full value from the system is another. Even when a nonprofit chooses a strong platform, the software may still fall short if it is not fully set up, connected to existing tools, or built for the reporting leadership needs.

An experienced nonprofit outsourced accounting team can help close that gap. Support may include software selection, implementation, and stronger reporting once the system is in place. It can also help preserve consistency during staff transitions and reduce the loss of institutional knowledge. The software choice matters, but the long-term benefit depends on the setup and ongoing support.

Questions to Ask

To determine if a new accounting software is worth pursuing, nonprofit leaders will want to ask the following:

  • Does the current accounting system still fit the nonprofit’s needs?
  • Is staff spending too much time on spreadsheets or manual entry?
  • Are leaders getting real-time financial information that supports decision-making?
  • Can the current setup support growth or staffing changes with little notice?
  • Would outside accounting support help the organization get more value from its current system?

If any of those answers are unclear, it may be worth taking a closer look and talking with advisors.

Looking Ahead

Accounting software plays an important role in nonprofit planning. When it fits the organization and is used to its full potential, it can lead to stronger reporting, smoother operations, and better decisions. This can help nonprofit leaders make better use of limited time and resources while keeping the focus on the mission. For more information, contact PBMares Not-for-Profit Partner Bo Garner.