When you’re running a small nonprofit, every dollar matters. It’s tempting to handle bookkeeping yourself, especially when your organization has a limited budget and a small team.
But as your nonprofit grows, so do its financial responsibilities.
Does your small nonprofit really need a bookkeeper?
Not necessarily a full-time one! However, having someone consistently maintain accurate financial records can make a big difference.
Here are five signs it might be time for professional bookkeeping support.
1. Your Executive Director or Treasurer Is Doing Everything
In many small nonprofits, bookkeeping falls to the executive director, board treasurer, or a dedicated volunteer.
While that arrangement may work initially, it can become overwhelming as financial activity increases.
When bookkeeping competes with fundraising, programs, and other responsibilities, important financial tasks can fall behind.
A professional bookkeeper can take those tasks off your plate, allowing your leadership team to focus on your mission.
2. Your Bank Accounts Aren’t Reconciled Monthly
Bank reconciliations help ensure that your accounting records agree with your bank statements.
If reconciliations aren’t completed regularly, errors, duplicate transactions, and missing entries may go unnoticed.
Monthly reconciliations are a fundamental part of maintaining reliable financial records.
3. Your Board Isn’t Receiving Timely Financial Reports
Your board of directors needs accurate financial information to fulfill its oversight responsibilities.
At a minimum, nonprofit leadership should regularly review financial statements that show the organization’s financial position and operating results.
If reports are consistently late, incomplete, or difficult to understand, your bookkeeping process may need attention.
Professional bookkeeping helps provide the reliable information your board needs to make informed decisions.
4. You’re Struggling to Track Donations, Grants, or Restricted Funds
Nonprofit accounting comes with responsibilities that many small businesses don’t encounter.
For example, certain donations and grants may carry restrictions on how or when funds can be used.
Properly tracking those restrictions is essential for accurate reporting and responsible financial management.
If your organization is having trouble keeping track of these details, working with someone familiar with nonprofit accounting can help.
5. You’re Always Playing Catch-Up
Does preparing for your annual Form 990, an audit, or a board meeting involve scrambling to organize financial records?
That’s a sign your bookkeeping system may not be working as well as it should.
Consistent monthly bookkeeping makes it easier to keep financial information organized and available when needed.
Can a Small Nonprofit Afford a Bookkeeper?
It’s a reasonable question!
The good news is that your organization may not need a full-time employee to receive professional bookkeeping support.
Outsourced bookkeeping services can be tailored to your nonprofit’s size, financial activity, and reporting needs.
Instead of paying for services you don’t need, you can focus on getting the right level of support for your organization.
Frequently Asked Questions
Can a nonprofit treasurer also be the bookkeeper?
Yes, depending on the organization’s circumstances. However, it’s important to maintain appropriate internal controls and separation of financial responsibilities, even when staff and volunteers are limited.
Does a small nonprofit need monthly bookkeeping?
Monthly bookkeeping is a good practice for nonprofits of all sizes. Regular transaction recording, account reconciliations, and financial reporting help keep records accurate and support informed decisions.
What’s the difference between a nonprofit bookkeeper and an accountant?
A bookkeeper generally handles ongoing financial recordkeeping, such as recording transactions and reconciling accounts. An accountant may provide additional services, including financial statement analysis, tax preparation, and more complex accounting guidance. Responsibilities can overlap depending on qualifications and the services offered.
Your Nonprofit’s Mission Deserves Reliable Financial Support
At Busy Bean Bookkeeping®, I understand the unique financial responsibilities nonprofit organizations face.
With professional experience in nonprofit and government accounting, I provide personalized bookkeeping support to help organizations maintain accurate records, stay organized, and make informed financial decisions.
Whether you’re ready to outsource your monthly bookkeeping or simply need help getting your books back on track, I’d love to learn about your organization.