If you follow Altruic Advisors on Twitter, you know that last week we shared new research from the Center For Effective Philanthropy about the relationship between donors and nonprofit organizations. In "Donors: 5 Things Nonprofits Want You to Know," CEP's report explores those things that are too often left unsaid in the philanthropic world. This report inspired us to think of all the things that are also left unsaid between nonprofits and their financial professionals. Here are the top five things that your accountants, bookkeepers, and auditors wish you knew:
1. We're not all experts in nonprofit finance.
Your accountant might be a whiz at estate planning and tax preparation, but that doesn't make them an expert on nonprofits. While there are many similarities between nonprofit and for-profit accounting, the differences are significant - and absolutely crucial to the compliance and functioning of your organization. That's not to say that an accountant used to working with for-profit companies couldn't meet your specific nonprofit needs. But to save time and money, start by making sure your accountant has experience with technical nonprofit subjects like restricted funds.
2. We don't know what you don't know (unless you tell us).
Accountants are used to speaking with other accountants. We have our own accounting language where we casually toss around acronyms like A/R, TB and GAAP and expect that everyone understands what we're saying. Unfortunately, this can lead to confusion and misunderstandings when speaking with nonprofit staff or board members who may not have any formal background in finance. Especially in small and mid-sized nonprofits, many of the people tasked with managing or reviewing their organization's finances are self-taught or have learned on the job. That makes it hard for your accountant to gauge your comprehension of certain subjects, especially at the beginning of an engagement. The solution? Ask questions! Tell us when you don't understand. If we're using terminology that you're not familiar with, make us stop and explain it. We'll thank you for saving us from the kind of miscommunications that lead to even bigger headaches down the road.
3. We hate wasting time.
In the world of nonprofit audits, efficiency is king. The last thing we want is to schedule a day of fieldwork at your office, only to arrive and discover that the files aren't available, the bookkeeping is incomplete, and the person we need to talk to is out of the country for the next three weeks. Your auditor should provide an explicit list of what they need from your staff. If you're having trouble completing the items on that list, let us know sooner rather than later. Any additional work that we have to complete beyond the terms of the engagement letter not only slows us down, but can also lead to extra fees for you. Which leads us to...
4. We need you to read your engagement letter.
An engagement letter is a contract that clearly lays out the scope of the work, fees, and any other special terms or agreements. Your accountant will provide you with an engagement letter before they begin service - it your responsibility to read and understand this letter. Be clear on what's included in the price, and what's not. No one likes surprises when it comes to the bill.
5. We sincerely want to help you create good.
Accounting for nonprofits can be a tough niche to fill. The work is complex, our profit margins are as slim as your budget, and it can be difficult to build long-term relationships with a board whose members frequently rotate. So why do we do it? For the same reason that you put up with long hours, low pay, and endless hoop-jumping - because it's worth it. You're making the world a better place, and we want to help you do that that best way we know how.