Is Quickbooks Online Really Useful For Nonprofits?
Accounting for 501(c)3 nonprofit organizations can get very tricky, especially when it comes to handling the income generated, loss, or any profit earned from day-to-day activities, such as a cafe, merchandise stall, store, etc.
QuickBooks® Online (QBO) is a nonprofit accounting software that strives to make this easy, but is it really the best platform out there? Would we deem it a useful tool for nonprofits?
Yes, QBO is a great tool when it comes to accounting for nonprofits, especially due to its ability to track and report nonprofit financial data via “class tracking” and other features. Furthermore, the world of nonprofits is ever-changing due to the numerous income/grant sources out there. QuickBooks Online is a great tool for keeping track of those. The automated entries, trial balance, and statement of functional expenses are huge pros in its favor.
Some other reasons for QBO being useful for nonprofits include:
QuickBooks Online has a 5GB and 25GB option for storing data. Still, in our opinion, only global nonprofits need to go for the 25GB option. Normally. 5GB is more than enough to store a nonprofit’s data, considering a typical excel sheet is around 3 to 5MB.
The biggest problem that 501(c) 3 organizations have to face is tracking expenses. It is more important to track expenses than it is to track income! QuickBooks offers numerous expense tracking categories that nonprofits can use to their advantage, such as:
- Variable, and
However, that’s not all. You can also create custom categories and use class tracking to keep an eye on them.
Finally, the most important factor to consider is the reporting element. Nonprofits need to report to several groups, such as the board members, accountants themselves, funders, the public, and more. That is where fractional CFO services come into play, pulling different reports from QBO easily and displaying them, thus saving you time and effort.
In essence, QuickBooks Online helps you keep better track of your expenses and income, helping you create a much sounder financial environment with no uncertainties or black holes.