7 Benefits of Outsourcing a Not-for-Profit Organization’s Essential Bookkeeping and Payroll Functions
Jun 10, 2019
We’re accountants. If you told us that we would need to execute a fundraising campaign, then we would probably feel like a fish out of water. Isn’t that the same feeling you experience when you think about bookkeeping or payroll processing for your nonprofit organization?
First, what’s the main benefit? Accounting outsourcing is often less expensive than employing an individual to handle various bookkeeping tasks. And that ultimately allows the nonprofit’s talent to focus on what they do best: running the organization and raising money.
While there are many benefits to outsourcing, we’ve identified the top seven benefits for not-for-profit organizations, which are detailed below.
- Improve efficiencies and reduce costs. The less time that regular staff spends on duties that can be outsourced, the more time they have available to raise money and fulfill the nonprofit’s mission. Additionally, the direct costs of processing payroll can be greatly reduced by working with a payroll provider.
- Gain a higher level of expertise. Many nonprofits can’t afford to employ a staff member with the specific expertise and continuing education requirements needed for bookkeeping or payroll functions. By outsourcing these tasks, organizations get the benefit of a professional’s expertise, as well as potentially proactive recommendations.
- Reduce threat of fraud with increased oversight. Segregating accounting duties is one of the top anti-fraud measures that a nonprofit can employ, therefore dividing tasks between employees and an outside CPA firm inherently reduces the risk of fraud. CRI’s not-for-profit CPAs can also outline a comprehensive internal controls program to protect the organization.
- Remove technological impediments.Does the thought of upgrading to new technology give you goose bumps? Bookkeeping and payroll software must be consistently updated, which creates additional expense and challenges. This concern is eliminated by outsourcing since outsourcing partners are responsible for upgrading to the most current technology and training staff on how to use the new technology.
- Avoid the accounting brain drain.If your bookkeeper or controller gets a new job, their knowledge of the bookkeeping and payroll process leaves with them. Using an outside service eliminates that business risk.
- Streamline direct deposits. Providing direct deposit is difficult if an organization doesn’t use an outside payroll service. More importantly, direct deposit eliminates time-consuming and error-prone paper handling—and the need to reconcile individual payroll checks every month.
- Stay current with regulations and laws. Most organizations don’t have time to keep up with constantly changing regulations, withholding rates, and IRS forms. Using the wrong tax tables can result in stiff penalties. Outsourcing payroll removes those headaches and keeps payroll running smoothly.
Swim on over to CRI’s nonprofit CPA pond.
Carr, Riggs & Ingram’s not-for-profit CPAs and payroll division, Paywerx, can handle all of your accounting outsourcing needs. Our team not only replaces individual tasks, but we can also create a virtual accounting department for your nonprofit. We can maintain books and general ledgers, prepare annual financial statements, discuss cash flow planning, manage payroll, provide guidance for budgets and financial decisions, and handle other accounts receivable and accounts payable tasks.
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