Accounting for charities and not-for-profits

AccountsIQ helps global charity, Lepra gain rapid multi-dimensional reporting and reduce processing time by 80% by moving to the Cloud.

Lepra are a charity leading the global fight for the eradication of Leprosy. Each day over 600 people worldwide are either diagnosed with Leprosy or are starting treatment for Leprosy. More than 8% of these are children.

Based in the UK but supporting operations on a global level, like many charities, Lepra have complex revenue generation. Their revenue comes from various sources and must be consolidated into one system for accounting and compliance purposes. Recognising the need for a cloud solution which can automate their manual processes and consolidate their revenue, the Lepra team engaged ION, a financial transformation specialist, to help find the right solution for them. The support ION offer enables a point of contact for the finance team should any issues arise – whether they are knowledge or training issues, or problems in simple transacting to complex reporting.

Requirements and Challenges

Lepra’s current accounting system was not giving them the reporting breakdown that they needed, meaning it was taking too long to pull together information which advised critical business decisions. In addition, the need to manage all their revenue in one place and have access to real-time data would not only save time but also give everyone in the team more access to information.

Like many businesses, Lepra’s current system was not well connected to their CRM system, Advantage, and this meant a lot of manual processing was needed to align the two systems. As with a lot of manual processes, this was time consuming, allowed for human error and often meant the process wasn’t followed exactly as required. Through the discovery phase, their implementation partner, ION, identified a lot of functionality and improvements that Lepra wanted to implement in the future, therefore the need to have a system which could be flexible and grow with the charity was important.

The final major requirement for the team was that the implementation could be quick and seamless. With a lot of disruption to the business already and with many team members working from home, they needed a solution which could be quick and easy to get everyone on board with.

Quick-to-Implement Solution

Taking all these things into consideration, AccountsIQ was identified as a good solution for Lepra. A flexible and user-friendly cloud accounting solution, AccountsIQ could address all of their requirements and open up many other benefits.

Nick Avery, Director of Resources, Lepra

“AccountsIQ was the only solution we found that combined the ease of use of cloud based accounting systems and the multi-dimensional analysis that is needed for charity accounting at a cost that we liked!” Nick Avery, Director of Resources, Lepra.

A concern for the team was the time it takes to switch over to a new system and how this would disrupt their processes. However with ION’s quick start implementation framework and our user-friendly interface, the transition was managed with ease. The implementation was completed in a matter of weeks, and the transfer of data to AccountsIQ was seamless.

Outcomes

Like many clients, within weeks, Lepra were finding many benefits to operating within a new system. The ease of use of AccountsIQ has made the adoption across the Lepra team much easier, meaning they can see the benefits of the system straight away. Several key areas have been improved:

• Process efficiency: manual processes have been drastically reduced, with some processes now 80% quicker than before.
• CRM data connectivity: the import of data from Lepra’s CRM system, Advantage has been simplified. Removing the need for additional Excel sheets and manual intervention to import and export data sets several times is helping to save the team a lot of time and undoubtedly removing opportunities for error.
• Remote access and usability: the usability of the AccountsIQ system has been praised by the Lepra team and means that the business has more active users getting the most of the system. With many teams still working remotely, having user-friendly cloud systems has minimised training requirements and empowered decision-making across the team.
• Expenses management: switching from paper methods to a digital system, expenses are submitted to the relevant manager directly, with the employee given full traceability to monitor the status of their expense claim.
• Scalability: the integration paves the way for scalability of the system in the future. Built on a solid cloud accounting system, the team can plan for additional modules and reporting functionality when the business requirements dictate.
• Maintenance: often with new software integrations, IT teams are typically concerned about the impact that a project implementation will have on their workload, but with the right system, maintenance for internal teams should be reduced. For Lepra, they have found that the system is much easier to maintain than their previous software.

Enclude helps charities bridge the digital divide by implementing AccountsIQ

IT charity consultancy Enclude was formed with the aim of helping other charities adopt technology to improve their data management, communications, CRM and financial management processes. Sylvester Murphy is Enclude’s CEO and also implementer of cloud-based financial management system AccountsIQ, Enclude’s preferred accounting platform for its charity clients.

Describing his reasons for selecting AccountsIQ, Sylvester says, “We undertook research a number of years ago in conjunction with a group of charities including the Irish Charities Tax Reform Group. The purpose of that exercise was to assess the impact of emerging legislation and SORP requirements and try to identify a suitable charity accounting software package for the sector. AccountsIQ, a web-based accounts system, emerged as a great candidate from this research. We approached them and they were delighted to assist in structuring an offering for the sector.”

Meeting a range of needs with one accounting solution

Over 1,000 charities are registered with Dublin-based Enclude all of whom are seeking to improve their digital capabilities and enhance their IT systems and business solutions.

The requirements for financial management systems can vary across charity sectors and over time. In choosing a financial system, Boards and management teams are seeking solutions that are accessible, affordable and scalable. Increasingly, organisations are seeking systems that will also offer the potential for integration with other systems such as a CRM and Payroll systems.

Smaller charities can realise the benefits of improved management and controls by moving from spreadsheets to fully fledged accounting databases. For charities with incomes in excess of €500,000 with higher transaction volumes, automated processes such as bank reconciliations will save a significant amount of time. Charities in the €1-5M bracket might need to map payroll data and other expenses across different programmes and cost centres, requiring more complex coding structures. Larger charities in the €5M or greater bracket will also benefit from workflow automation and the capability to handle multi-entity organisations with groupwide data consolidation and reporting.

Sylvester adds, “We find AccountsIQ unique in that it can meet the needs of both small and very large charities. We have been able to become proficient in implementing one financial software system which, although it is often adapted differently, fundamentally suits the needs of the widest range of charities.

Helping charities achieve compliance

The Charities Act of 2009 represented a significant milestone for the charity sector in Ireland. It reformed the law relating to charities in order to ensure greater accountability and a Regulator was introduced. It triggered an ongoing narrative across the sector around transparency, governance and the need for improved systems to better manage reporting and compliance. One way in which charities could enhance public trust and confidence was through improved reports: financial reporting had to become more sophisticated, requiring charities to review their accounting models so that they could report across a variety of operating categories. Sylvester adds,

One challenge our Irish charities had in complying with the 2009 legislation was in moving away from very ‘flat’ accounting structures and introducing multi-layered reporting on income and expenditure by SORP heading and cost centre such as programmes, projects and branch location. AccountsIQ’s flexible coding structure and GL structure allows charities to classify their programme expenses with little extra effort.

In addition to the sector’s specific reporting requirements, AccountsIQ holds many standard, template reports within the system itself. It is also possible for information to be manipulated in Excel should charities need to create particular reports for specific stakeholders.

In addition to complying with the 2009 Irish Charities Act, many of Enclude’s clients also have entities based in different jurisdictions which need to comply locally as well as centrally. These accounts need to be consolidated in a consistent manner (and currency) for group reporting, all of which is handled within AccountsIQ’s integrated consolidation module. Sylvester adds, “Prior to using AccountsIQ for consolidation, the work done in spreadsheets by our multi-entity charities was hugely complex and time-consuming.”

Charity cloud accounting supporting flexible working structures

Non-profit organisations are often structured and resourced with staff and volunteers which may be part-time and working remotely. Commenting on the suitability of cloud apps in these scenarios, Sylvester says,

Cloud-based business apps like AccountsIQ give charities robust tools coupled with tremendous flexibility in how services are delivered and managed. You can access the software anytime and from any device. Also, the system allows you to define user profiles which means that you have very strict controls over who can access the system and to what degree. Providing remote access to people like external accountants or auditors can also help charities negotiate lower fees.

An implementation model which makes the most of the Cloud

Over the years, Enclude has developed a tried and tested implementation model supported by the customer success team at AccountsIQ. A phased implementation approach usually works well, allowing the charity to make steady progress at a manageable pace and to spread the costs over time.

The initial phase includes defining the data structure and chart of accounts so that data from previous systems or spreadsheets can be imported and correlated. “This ensures that fundamental reporting requirements will be met. With AIQ in place we then tend to look at potential for further enhancements such as integration with the organisation’s CRM solution.”

Where charities have implemented a cloud based CRM solution to manage their client service programmes, donor management and fundraising activities, he says it is possible to achieve further levels of efficiencies and control by integrating data feeds between the CRM system and AccountsIQ. “We have worked with a number of Charites, who have automated the processing of their donations from their web site into their CRM and onwards into their AccountsIQ financial management system.“

Enclude’s clients which use AccountsIQ are supported in the first instance by Enclude. More complex issues requiring level 2 support are escalated to Enclude’s customer success manager at AccountsIQ.

On the quality of support, he receives from the AccountsIQ’s team, Sylvester says,

The services team and support at AccountsIQ is very good and that is particularly important in the charity sector as we seek to transition the digital divide and build trust and competence in cloud solutions. The entire support process is managed within the system itself and there is a range of “How To” guides and online Help tools.”

AccountsIQ’s CEO Tony Connolly says, “It is great to see the Cloud making such a positive impact in the Charity sector. It is a pleasure to work with the team at Enclude which finds ways to make digital transformation achievable for other charities by providing experience, skills and resource.”

The Diocese of Arundel and Brighton’s finances are transformed by consolidated Cloud accounting

In 2018, The Diocese of Arundel and Brighton began a digital finance transformation initiative with AccountsIQ. It was a highly ambitious project involving complex workflow automations. There were also multiple stakeholders, including around 70, mainly volunteer, users with varying levels of accounting and IT experience.

The Diocese had been using a stand-alone finance system, called Finance Co-ordinator. “It had a good Chart of Accounts,” Sarah recalls. “But no consolidation function. At the end of the year, each parish would send in their activity and finance would re-key the transactions.”

These manual processes were time consuming and error prone. More importantly, the only management information the Diocese had was a P&L and balance sheet for each parish. “There was no granularity,” says Sarah, “the old system didn’t give us the insight we needed at individual parish level.”  

In search of a more advanced cloud system, Sarah talked to AccountsIQ’s CEO, Tony Connolly, and the finance team from the Archdiocese of Dublin, who were already an AccountsIQ customer.  

“AccountsIQ is Cloud-based, so I can access the parish books and see what’s going on from the centre.” 

Sarah Kilmartin, COO, The Catholic Diocese of Arundel and Brighton.

Moving to AccountsIQ enables automated, efficient processes  

The Diocese of Arundel and Brighton chose AccountsIQ because they wanted to be able to share a single platform with their parishes. Their objective was to automate as much of their manual finance processing as possible.

Digital cash collection is an example of an effective process that AccountsIQ created specifically for the Diocese.  Income from each church is entered on an online cash collection sheet, which updates directly into AccountsIQ. This means income is recognised directly on entry and can be consolidated across all parishes. Crucially, Sarah’s team didn’t simply replicate their previous, paper-based cash collection process into AccountsIQ.

“We combined a number of processes,” explains Sarah. “Now, it’s quick, easy, and error proof with no re-keying, sending emails or putting things in the post. I also look after a small parish as a volunteer and the monthly bank rec takes less than 15 minutes.

Sarah also likes the useability of AccountsIQ, “The most useful feature for me as COO is having all my parishes laid out in a list. I can click down to the transaction level detail very easily. I also have full trust in the completeness and accuracy of the data being captured; it accounts for every penny that goes through the bank.”

Granular reporting is revolutionising the church finance role

The Diocese is using AccountsIQ extensively for analysis and reporting.  Each parish has its own database in AccountsIQ, and the BI coding structure enables the Diocese to run reports for each church, fund, site or central office department.   

“This multi-dimensional reporting is perfect for our setting. It has revolutionised our potential to do our job here in the centre. That is to stand over these charitable funds and know exactly what’s going on with the funds of each charity.

“I find the management reports useful and look at them all the time. For example, when a new priest comes to a parish I can run through the P&L very easily. Previously, we didn’t have this level of information.”

Digital transformation is an on-going collaboration

After several years on the platform, AccountsIQ continues to work well for the Diocese. Sarah reports that they hit their year-end deadlines, with all parish accounts reconciled within two months. “Initially, we needed support to roll out the project,” she recalls. “But our users are now confident using the system.”

Looking back, Sarah describes this complex digital transformation project as a creative, on-going collaboration between the Diocese and the AccountsIQ team. “There are still things we plan to do,” she says. “For example, contactless payments have become mainstream since we started with AccountsIQ, and we need to find a solution that works for us. That said, whenever we bring problems to AccountsIQ, they understand them and help us sort them.”

“AccountsIQ is a product I would happily recommend to others. It has revolutionised how we do our job.”

Sarah Kilmartin, COO, The Catholic Diocese of Arundel and Brighton

Summing-up, Sarah concludes that, now they have everyone working on one central Cloud accounting platform, they would never go back.

“We have fewer finance staff now, but they are more skilled. Our people costs may not have gone down, but the quality of what we know has gone up. We would certainly never go back to having 80+ desktop systems. Ultimately, AccountsIQ is a product I would happily recommend to others.”

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Discover how AccountsIQ's accounting software for charities solves the often complex accounting challenges of over 100 not for profits such as Humentum. 

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