Keep your nonprofit’s books accurate and up to date with some daily accounting tasks. Similar to businesses, nonprofits receive and spend money, purchase inventory, pay bills, and transfer money between banks on a day-to-day basis. Doing these daily transactions will speed up your month-end close process. (Your organization may choose to do them weekly instead.) Here are some video breakdowns of some of the most common tasks to accomplish when managing your nonprofit’s books.
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Daily Accounting Tasks
Enter Income and Expenses
Track what Asset account each transaction impacts, the Income or Expense account category, and the Equity account.
Track Donations and Prepare Your Bank Deposits
Make sure you track your donations by fund and note what part of your income is tax-deductible for donation statements.
Pro Tip: Always have two people count donations and prepare the bank deposit slip. This improves accountability and transparency that all donations received were deposited.
Track the due date of new bills so you can more easily anticipate your cash flow.
Pro Tip: For good internal controls, choose a separate person to sign checks to confirm the amount matches the invoice or estimate, and is an approved expense.
When you have a transaction that is not a standard expense or deposit, a journal entry can help you keep track of it. For example, if you need to transfer dollars between funds or bank accounts, such as allocating a portion of your General Fund to your Events Fund, you would note this in a journal entry.
How to Perform a Bank Reconciliation
Bank Reconciliations are an important internal control for your organization. They are designed to reconcile your bank statement with the information in your bookkeeping. If your accounting software doesn’t accurately reflect your bank’s statement, it can make it hard to find errors and manage your account balances. Most organizations perform them monthly, but that could vary depending on your needs.
Pro Tip: Have someone other than the bookkeeper check the month-end financials and bank reconciliation report to help spot errors. It is much easier to fix them if you catch them early.
Your Free Checklist
In addition to completing daily accounting tasks, having a monthly checklist can help ensure all financial transactions that affect your bottom line are accounted for. Setting a deadline for the month-end close helps too. For example, close the month and run reports by the fifth of the following month. Here is a checklist of all the tasks to complete when closing out your bookkeeping each month.
Now that you understand what to maintain daily, sign up here and we will send you the entire nonprofit accounting course through email. We’ll look at how to set up your chart of accounts, track your donations in your accounting, and so much more.
If you’re ready to get started with awesome fund accounting, learn more about Aplos Accounting.