Enable outcome-based accounting for nonprofit fund management with Unit4’s ERP suite
The management and tracking of funds are arguably what can lead nonprofit organizations to more optimized operations. Funding has generally decreased for nonprofit organizations, not just from the government but from donations too, so there is a greater demand to not just manage existing funds but to plan financially for the future.
It’s not just financial challenges nonprofits must navigate, but also a greater demand for their services.
One barometer for demand is foodbanks – The Trussell Trust reported that there has been a 94% increase in foodbank usage over the past five years in the UK, which also highlights a lack of public funds for donation.
By managing and planning finances more easily, nonprofits can prepare for the unpredictable and ensure that they are doing the most with what they currently have, rather than losing a margin of funds to poorly managed legacy processes that cost time and funds themselves.
In this blog, we will explore how nonprofits can make fund management simple with Unit4’s Cloud-first ERP solution, and more - keep reading to find out!
Current challenges to nonprofit fund management
Fund management may seem relatively simple, but nonprofits may suffer from multiple issues that prevent effective fund management. Against a backdrop of limited resources for IT projects and outdated legacy systems, maintaining infrastructure and systems used for tracking funding can become a challenge.
The costs of maintaining multiple applications and systems add up. Additionally, these fragmented systems won’t integrate perfectly, meaning the flow of data in the nonprofit organization can be hampered, leading to multiple versions of the truth regarding the health of funding.
Manual data consolidation and entry will fatigue financial staff and make their job more arduous than necessary , burning them out and leading to errors. Poor user experience and collaboration mean that simply understanding funding becomes a challenge, leaving little time to plan finances for the future or predict prospective conditions.
Beyond operational challenges, there are other governance and compliance factors that make fund management a greater challenge – from restrictive grant conditions to complex reporting requirements. Nonprofits will want their fund management to be under control and simple.
The challenges don’t stop there, but nonprofits should understand that on-premises and legacy systems are fragmented and lack the efficiency needed to even manage funds, let alone analyze, plan, and predict finances based on current funding.
Click to read Helping nonprofits deliver on their mission with FP&A and HCM Gated
How Unit4 ERP’s nonprofit model for fund management can maximize impact
Within a single unified solution for fund management that utilizes Cloud-first capabilities, the fund management process isn’t just easier and better value but also enables organizations to extend their fund management with a view to the future. Automated fund distribution with refined controls can also allow for more efficiency in the allocation process.
The management of funds on a basic level becomes easier with a centralized fund tracking system that enables the allocation of funds to multiple projects and programs easily. Cloud technology enables near real-time visibility into fund balances and how funds affect grants, awards, and donations.
Importantly, comprehensive reporting on fund utilization will enable greater insight into and communication of fund utilization to support donor reporting as well as compliance—this is a key part of an ‘outcome-based’ approach to accounting.
Outcome-based accounting is about more than just knowing where funds are and where they are allocated. It enables nonprofit leaders and donors alike to gain insight into the impact of funds on specific campaigns, which is a vital part of nonprofit financial reporting.
Fiona Buruma, Director of Finances and Operations at Warchild , notes that, “With Unit4, it allows us to have all information available, worldwide, in one system, accessible from all different locations where we work. Unit4 is a flexible system that allows us to track our funding, grants, sub-grants, and the different projects that we have to comply with donor requirements.”
Julian McGovern, CIO of Save the Children International , adds that, "It’s no exaggeration to say that, thanks to Unit4, we can now track the pound someone donates through a television appeal right through to it being used to improve literacy in Rwanda.”
When empowered by Unit4’s ERP suite, you will have the tools to maximize available funding and understand how funding can directly impact campaigns, with an improved ability to report on this. Our ERP and FP&A software provides reliable reporting and deeper insight into your financials, enabling you to make informed decisions and improve transparency.
To learn more, read our capability datasheet , visit our nonprofit-specific webpages , or view our short explainer video below—or talk to sales today!
