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This article was kindly written and provided to us by Data Developments.
Uncover the six of the best charity bookkeeping tips to make the recording of financial affairs straightforward and enable you to focus on other areas of your organisation.
If you are a charity or faith based organisation, you will know there are always a million things to stay on top of.
And many small charities don’t have the luxury of having a finance team to record and track transactions, which can lead to other volunteers and staff taking on responsibilities, including handling the finances.
But it doesn’t have to be this challenging.
Read on to uncover six charity bookkeeping tips to help you streamline operations and keep your financial affairs in order.
Good charity bookkeeping requires accuracy and great attention to the finer detail. Follow our six simple tips to make in-house bookkeeping easier.
Our number one tip for non-profit bookkeeping is investing in easy-to-use software. If you still use handwritten ledgers or Excel spreadsheets to track your finances, you should consider streamlining the process and finding a new way. Not only will accounting software make your processes easy, but your online charity accounting software will also eliminate the risk of error and free up your time to do other significant tasks. Efficient accounting software can make it easy to store data correctly, review and update your accounting process regularly, and help you automate as much as possible. We recommend doing your research on the best bookkeeping software for charities and faith organisations before anything else.
The first step to good charity bookkeeping is recording your transactions regularly.
You will need to put some time into updating your donations and money received to know your expenses as best you can.
Therefore, you must keep proof of your invoices and receipts when you miss anything or need proof of payments. As a charity organisation, recording your transactions can make it easier to see where the donations are going and who they help.
Today, pretty much everything is done online. From digital invoices and receipts to online banking, it is now easier than ever to keep your information all in one place. With Online charity bookkeeping it is much harder to lose and easier to keep on track than a piece of paper. Not only that, but it also makes it easier for busy charities to coordinate with outside contractors. With a long list of rules and regulations for charities and faith organisations to follow, you want to make life less chaotic and much simpler for everyone involved. Using online bookkeeping software for charities and processes can give everyone in the organisation access to information and financial details. It can also make your Independent Examination or audit easier as well.
It’s time to transition from cash to debit cards where possible.
Cash can often go missing, whereas bank and credit cards can make transactions smoother and much quicker.
Much like the previous point, bank and credit cards make bookkeeping easier as they have spending statements which make finances easy to digest and monitor.
Alternatively, you can make online payments through your bank, which give the option of being dual authorised for that added level of security.
Cash flow is the money that comes in and out of your organisation over a set period.
And even charity organisations have regular payments, including utilities, rent, stock, or insurance.
Poor cash flow can make it hard for a charity or faith organisation to stay afloat. But by tracking this and putting all your finances in one place, you’ll see a shift in your money management. You can be made more aware of excess cash that will benefit your charity and cause. You can also budget accordingly.
As a charity or faith organisation, you probably won’t need to pay taxes on your income due to tax relief, provided the money goes towards charitable causes. And to prove you are elgible for tax relief, you must provide accurate financial records and statements to show where your donations and money are going. Good charity bookkeeping will enable you to provide an accurate statement that outlines what you have earned and where your funds go.
This article was kindly written and provided to us by Data Developments.
Ready to make your bookkeeping a lot easier? At Data Developments, we specialise in developing software, services and training for Churches and charities.
With our software, you can manage and streamline your financial processes with little to no accounting knowledge. It’s so easy that anyone can use it. But if you get stuck, there’s always an expert on hand to help.
We want to help you make managing your finances to help you make proactive decisions with our valuable knowledge and online tool. If you are a non-profit looking for easy-to-use software that meets legal requirements, get in touch today.
