Tag Archive for Nonprofit Organization Resources

Navigating The Crowded Non-Profit Sector

Nonprofit donors

How organizations can set themselves apart to secure—and retain—donors

By Shannon Crowley, CPA, MSA
Accounting Manager

Despite the Great Recession and the long process of economic recovery of the 2000s, the non-profit sector has become one of the country’s fastest-growing industries. According to the National Center for Charitable Statistics’ most recent research, the United States is home to more than 1.5 million registered non-profit organizations—marking a nearly 20 percent increase over the last 10 years, a time frame in which many businesses in the for-profit sector have struggled.

This rapid growth is certainly a sign of success, and—as non-profits employ nearly 11 million American workers and contribute roughly $887 billion to the national economy—it is difficult for anyone to argue against the economic value of a thriving non-profit sector.

However, the unprecedented rate at which new organizations are being created is also creating a challenge. The non-profit sector is more crowded than ever before, making it very difficult for organizations to secure—and retain—their donor bases.

On a local level, there are 33,000 non-profit organizations registered in Massachusetts—each competing with one another for precious dollars from a limited pool of individual donors, corporate foundations and other fundraising sources. In a recent cover story in The Boston Globe, many industry experts argue the field of non-profit organizations in Massachusetts is simply too large to sustain.

However, the organizations themselves, and the tens of thousands of Massachusetts residents employed by non-profits, are doing everything they can to prove those experts are wrong.

And that starts with donor retention.

The Association of Fundraising Professionals reports that, on average, donor retention rates across the non-profit sector are around 43%, meaning less than half of an organization’s 2016 donor base will contribute. In order to grow in a competitive non-profit environment, organizations have to find a way to land recurring donors. To do this, non-profits are employing several strategies. For the purposes of this article, we’ll focus on three:

Differentiating themselves from other, potentially similar organizations

Many potential donors or grant-awarding foundations would love to support every deserving cause that asks for and needs their help. Realistically, though, donors need to choose between hundreds, if not thousands, of similarly operating organizations to which they can lend their financial support. Non-profits, especially non-profits working to support similar demographics, are under enormous pressure to set themselves apart to attract new sources of funding. It’s never been more important for a non-profit to have a very clear, very specific mission.

Investing in “fundraising infrastructure”

Fundraising success is entirely beholden to the amount of time and resources organizations are willing to invest. In order to succeed in today’s hyper-competitive non-profit sector, organizations must invest in fundraising professionals, such as high-ranking development officers, and fundraising “infrastructure,” such as top-notch technology and donor databases.

The clear, specific vision makes an organization attractive to donors. Development professionals and in-depth donor databases help organizations find them.

Increase efficiency by streamlining their accounting functions

Back-office financial work is crucial to the long-term success of the organization. That said, it’s also very time-consuming. As many organizations are investing significantly more time to their fundraising operations, some non-profit leaders are finding ways to take complex financial paperwork off their desk so they can focus on the organization’s core competencies. This may entail creating new jobs for a full-time accounting team, or hiring a third-party financial organization to take on those responsibilities.

How BlumShapiro Can Help

BlumShapiro offers the accounting, tax and business consulting expertise non-profits need today. We are one of the largest non-profit accounting service providers in New England, our blend of accounting expertise and knowledge of non-profit organizations means we can offer you tremendous added value. We can assist you in complying with state and federal grant requirements, charitable giving rules, capital campaigns, endowment fund responsibilities and other specialized needs. Learn more >>

View Shannon’s Bio Here >>

Year-End Donation Acknowledgement Reminders

Nonprofit CPA Firm - donation RemindersAs  some donors wait until year end to make their annual contributions to charitable organizations, and there is a push by non-profits to get in these donations, following are a couple reminders on what information needs to be provided to donors related to these donations:

  • A written acknowledgement for all contributions over $250 (while some organizations will provide an acknowledgement letter for all contributions, this is the minimum requirement).
  • A written acknowledgement to a donor for a quid pro quo contribution over $75.  A quid pro quo contribution is an amount received by a charity that is partly for goods or services and partly a contribution.  This acknowledgement needs to break out the value of the goods or services that the individual received.

Required acknowledgements must be contemporaneous, typically within 60 days after the organization receives the donation.

Here is a link to a prior article on this matter as well as the IRS guidelines.

Michelle Hatch is a partner in our Non-Profit Services Group. She oversees audit and accounting engagements for non-profit organizations, including independent schools, trade associations, health and human service organizations and art, cultural and membership organizations. Michelle is also a member of the Employee Benefit Assurance Group and oversees audits for 401(k), 403(b) and defined benefit retirement plans.

Using Form 990 for Organizational Improvements

While many non-profit organizations may be exempt from income taxes, they are not exempt from the federal government’s recordkeeping requirements. Among those requirements are tracking revenues and expenses and reporting those items to the Internal Revenue Service (IRS) by way of Form 990. The requirement applies to organizations as small as the local Little League affiliate or as large as a major hospital.

While organizations file Form 990 because it is a requirement to maintain their exempt status, many may not realize that there are many other ways the Form 990 can be used to benefit your non-profit organization.

The Form 990 not only serves public purposes, it can serve organizational purposes as well, allowing board members, donors and others access to information about an organization’s financial management, operations and governance. It is a tool—a research document—for understanding your organization, its strengths and its weaknesses.

Read the full article to learn more >>

Top 10 Twitter Accounts to Follow for Non-Profit Organizations

Twitter for Non-profit OrganizationsTwitter has been taking the world by storm, but it’s not just for entertainment artists and your teenage children.  There are many non-profit organizations and groups that support non-profit organizations that are on Twitter, using it to spread their message and keep their followers up-to-date on current news and events.

Top 10 Non-Profit Twitter Accounts to Follow

Here’s a list of the top 10 (actually 11) non-profit related Twitter Handles (Twitter’s cool slang for ‘Name’ or ‘ID’):

  • @SM4Nonprofits – Social Media for Non-profits is the world’s only conference series dedicated to social media for social good and to date has earned a 92% approval rating from over 2,500 non-profit leaders across the USA.
  • @NonprofitOrgs – The mission of this Twitter profile is to serve as a portal to all non-profit organizations on Twitter.
  • @NonProfitTimes – The leading business publication for non-profit management.  News, Special Reports, Jobs and Expert Advice for the non-profit Sector.
  • @Philanthropy – The Chronicle of Philanthropy’s official Twitter page, dispensing news, advice and commentary about the non-profit industry.
  • @GuideStarUSA – GuideStar gathers and disseminates information about every single IRS-registered non-profit organization.  It provides as much information as it can about each non-profit’s mission, legitimacy, impact, reputation, finances, programs, transparency, governance and more.
  • @IRSnews – IRS news and guidance for the public, press and practitioners.
  • @AFPIHQ – Association of Fundraising Professionals (AFP) – Since 1960, AFP has inspired global change and supported efforts that generated over $1 trillion. AFP’s nearly 30,000 members raise over $100 billion annually.
  • @NTEN – Tips, resources and even live webinar coverage (#NTENlearn) about all things about non-profit technology.
  • @SSIReview – Social Innovation.  Informing and inspiring leaders of social change.
  •   @AICPA – The American Institute of Certified Public Accountants. Follow this account for accounting news, Institute announcements and other updates.
  • @AccuFund – AccuFund provides top-rated accounting and fundraising solutions designed exclusively for the nonprofit industry. (In the interest of full disclosure, this is a biased one, as AccuFund is a product the Business Solutions division of our consulting practice represents.)

Sean Niland, Intacct ConsultantSean Niland is a manager in our Consulting Group, Sean provides implementation, conversion assistance, training and ongoing support for the firm’s clients.  His industry experience includes privately held businesses such as hospitality and professional service firms; non-profit organizations such as health and human service agencies and arts and cultural organizations; and municipalities.

Sean is certified in Intacct, AccuFund and Tagetik.