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QuickBooks® and Fund Accounting
QuickBooks® and Fund Accounting
QuickBooks® is a very popular accounting software, but can a nonprofit or church use it to manage their bookkeeping? If you need to do fund accounting in QuickBooks®, you’ll need to be aware of some workarounds to get what you need. Tracking money at the fund level and running the required reports for your board are hassles in QuickBooks®. They take much more time and effort than they should because you have to use a combination of sub-accounts, classes, external spreadsheets, or even separate bank accounts.
Curious what the workarounds are and how QuickBooks® is different than true fund accounting? We created a short video to show you how some nonprofits and churches make QuickBooks® work to get the reports they need and how this differs from true fund accounting.
Fill out the form to watch the free 10-minute video: Can QuickBooks® Do Fund Accounting?
There are several factors to carefully consider before selecting QuickBooks® as the accounting software for your organization. The reality is nonprofits and churches have different needs than businesses. Whereas businesses focus on profitability, your organization needs to be a good steward of the resources people give. That means you need to show transparency and accountability. When someone gives money to your organization, they often designate a purpose for that money. You need to track that designated money to ensure it is used as intended. That means you need to use fund accounting, which is complicated and difficult to do in QuickBooks®.
Fund accounting doesn’t have to be difficult or complicated. The right software can provide everything you need while making fund accounting simple. Aplos was specifically created for nonprofits and churches, and their fund accounting needs. See why many nonprofits choose Aplos over QuickBooks®.
“They (Aplos) saw a need for non-profits to have an easier way of doing their finances other than Quickbooks and met that need at a very affordable price, which is very important to nonprofits. Simplicity is important because often, the bookkeeper is a volunteer and does not have the experience required to use a cumbersome program like QuickBooks.”
Denise S.
Capterra Review
Using QuickBooks®’ nonprofit solution may sound like a good idea. However, there are several things to be aware of. Many nonprofits and churches try hard to get it to work for them. But they are often unaware of the required workarounds to get the reports they need. Watch the video to see how it may not be the best choice for your organization.
During this video, we do an in-depth walkthrough of how this platform tracks designated funds. We’ll show you the steps you must take to get to your Cash Balance by Fund, Income Statement by Fund, and Balance Sheet. Plus, we compare it to Aplos, a true fund accounting software based in the United States and made for nonprofits and churches.
What can true fund accounting software do that small business accounting solutions cannot?
Accounting applications specifically created for nonprofits and churches allow you to track designated money in multiple funds. Then you can pull reports based on those funds to track income and expenses. The ability to do all of this is called fund accounting. For more information, read a complete definition of fund accounting.
Trouble Tracking At The Fund Level
Like with most general business accounting programs, there is no way to easily track income and expenses for designated funds. Income is dropped into one general fund. Therefore, you must use a combination of sub-accounts, classes, external spreadsheets, or even separate bank accounts. Take a look online at our complete evaluation of QuickBooks® for Nonprofits.
The Verdict
Having a true fund accounting system will allow you to pass your annual audits, and produce reports for your board to show them your organization is using its money appropriately. Plus, your supporters will have the assurance that you are stewarding your resources in the way they have asked. Unfortunately, QuickBooks® does not make this easy.
To learn more about how true fund accounting is different, try Aplos Nonprofit Accounting Software for free.
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