Non-Profit Posts

When Pivoting in a Crisis, What Should Small and Medium-Sized Not-for-Profits Prioritize First?

Periods of crisis force leadership teams to move quickly. Revenue shifts, program demand changes, and uncertainty increases pressure across staff and board. When facing disruption, many leaders immediately focus on diversifying funding or launching strategic planning conversations.  Those steps matter. However, crisis response often requires deeper structural decisions that are less comfortable but more …

Periods of crisis force leadership teams to move quickly. Revenue shifts, program demand changes, and uncertainty increases pressure across staff and board. When facing disruption, many leaders immediately focus on diversifying funding or launching strategic planning conversations. 

Those steps matter. However, crisis response often requires deeper structural decisions that are less comfortable but more impactful. 

Below are three areas small and medium-sized not-for-profits should evaluate early when pivoting. 

 

Make Clear Decisions About Staffing 

In times of instability, staffing structure deserves immediate review. Not-for-profits often delay difficult personnel decisions due to strong values around inclusion, loyalty, and belonging. While those values are important, maintaining roles that no longer align with strategy or financial reality can weaken the entire organization. 

Crisis periods often clarify which positions are essential to the organization’s future and which may be better suited for transition. Leaders should assess: 

  • Whether current roles align with the core mission and theory of change 
  • Whether workload distribution supports productivity and morale 
  • Whether the organization can sustainably fund each position 

If separations become necessary, they should be handled with transparency and fairness. Establishing clear, values-based severance policies supports both employees and organizational credibility. Financial sustainability and compassion are not mutually exclusive, but they must be balanced thoughtfully. 

 

Reevaluate Physical Space and Overhead 

Office space is another area that warrants review. The relationship between not-for-profits and physical space has shifted significantly in recent years. Many organizations no longer require the same square footage or fixed-location commitments they once did. 

Leaders should ask: 

  • What type of space is truly necessary to deliver programs effectively? 
  • How often is the space used, and at what cost? 
  • Could hybrid or shared-space models reduce overhead without harming service delivery? 

Reducing or restructuring space is not simply a cost-cutting exercise. It requires operational planning, clear policies for hybrid work, and investment in effective collaboration systems. If an organization pivots to remote or hybrid operations, it must also establish expectations for communication, accountability, and team cohesion. 

 

Evaluate Funding Alignment, Not Just Funding Volume 

During financial pressure, it can feel counterintuitive to step away from revenue. However, not all funding supports long-term sustainability. 

Grants and contracts should be evaluated for mission alignment and full-cost coverage. Leaders should assess: 

  • Whether funded programs still align with strategic priorities 
  • Whether the funding source covers true direct and indirect costs 
  • Whether accepting the funding requires maintaining roles or expenses that no longer serve the broader mission 

Funding that drives strategic drift or sustains non-core programming can create long-term strain. In some cases, choosing not to renew a grant or contract is a proactive decision that strengthens focus and impact. 

Walking away from misaligned funding signals clarity about purpose and reinforces disciplined governance. 

 

Balancing Strategy With Structural Change 

Diversifying revenue and engaging the board in strategy discussions remain important crisis responses. However, structural decisions around staffing, space, and funding alignment often have the most immediate financial impact. 

Crisis pivots require courage and careful change management. Clear communication, transparent decision-making, and alignment between board and leadership are critical throughout the process. 

At DBC, our not-for-profit specialists work with organizations to evaluate cost structures, assess funding sustainability, and align operational decisions with long-term mission goals. Thoughtful analysis and proactive planning can help organizations navigate disruption while protecting financial health and organizational integrity. 

To read the original article by Jeanne Bell, please visit https://nonprofitquarterly.org/when-pivoting-in-times-of-crisis-what-should-small-and-medium-sized-nonprofits-prioritize-first/ 

 

Four Fundraising Trends Not-for-Profit Leaders Should Plan for in 2026

Fundraising continues to evolve in response to economic pressure, shifting donor behavior, and rapid technology changes. While overall generosity remains strong, participation trends are changing. Many organizations are seeing fewer small-dollar donors and more reliance on larger gifts.  As we move into 2026, sustainability will depend less on adopting the newest tool and more …

Fundraising continues to evolve in response to economic pressure, shifting donor behavior, and rapid technology changes. While overall generosity remains strong, participation trends are changing. Many organizations are seeing fewer small-dollar donors and more reliance on larger gifts. 

As we move into 2026, sustainability will depend less on adopting the newest tool and more on using the right tools intentionally. Strong systems, responsible data practices, and consistent donor engagement will separate stable organizations from those struggling to adapt. 

Below are four fundraising trends not-for-profit leaders should prioritize in 2026. 

 

Artificial Intelligence Becoming Operational Standard 

Artificial intelligence is quickly becoming part of everyday fundraising operations. Many organizations now use AI-powered tools for donor segmentation, data cleanup, analytics, and reporting. Tasks that once required hours can often be completed in minutes. 

For larger organizations, predictive analytics and donor journey insights are becoming more common. Smaller not-for-profits are also gaining access to embedded AI features within existing platforms, making the technology more practical and affordable. 

In 2026, the most effective organizations will use AI to increase efficiency without compromising authenticity. Human oversight remains essential. Clear data policies and transparent communication about technology use will help preserve donor trust. 

 

Donor Privacy as a Competitive Advantage 

Donors are increasingly cautious about how their personal and financial information is handled. Trust in not-for-profits remains relatively strong, but concerns about transparency and data security are growing. 

Privacy practices can no longer be treated as a compliance exercise. They must be visible and intentional. Secure payment systems, clear consent options, and straightforward privacy policies influence whether a donor completes a gift. 

Visible security indicators, accreditation badges, and options such as anonymous giving or communication preferences reinforce credibility. Organizations that demonstrate responsible stewardship of donor data will strengthen trust and improve retention. 

 

Monthly Giving Providing Revenue Stability 

While small-dollar donor participation has declined in many sectors, recurring giving programs continue to grow. Monthly donors often contribute more annually than one-time supporters and provide predictable revenue that supports long-term planning. 

Recurring programs also allow donors to make manageable contributions over time. This structure can increase loyalty and engagement. 

Not-for-profits should review donor data to identify strong candidates for recurring programs and communicate the impact of sustained support. Shifting focus from one-time transactions to long-term relationships will improve stability in an unpredictable funding environment. 

 

Personalization Moving From Preference to Expectation 

Generic fundraising messages are becoming less effective. Donors increasingly expect communication tailored to their interests, giving history, and preferred channels. 

Technology now allows segmentation and personalization at scale. Strong customer relationship management systems help consolidate donor data and support timely, relevant outreach. Personalized acknowledgments, targeted campaign invitations, and communication frequency preferences all contribute to a stronger donor experience. 

However, personalization should focus on relevance, not volume. Asking donors how and when they prefer to hear from you, and honoring those preferences, reinforces respect and builds trust. 

 

Planning for a Sustainable 2026 

Fundraising in 2026 will require both discipline and adaptability. Organizations must balance innovation with sound governance. Operational efficiency, responsible data management, recurring revenue strategies, and thoughtful personalization will be central to long-term success. 

At DBC, our not-for-profit specialists help organizations strengthen financial systems, evaluate fundraising sustainability, and align operational strategy with long-term mission goals. Clear planning today supports stronger donor relationships and more stable growth in the years ahead. 

To read the original article by Raviraj Hegde, please visit https://www.forbes.com/councils/forbesbusinessdevelopmentcouncil/2026/02/03/4-fundraising-trends-every-nonprofit-leader-should-plan-for-in-2026/

When Not-for-Profit Staff Want Raises You Cannot Afford

Compensation conversations are among the most difficult challenges not-for-profit leaders face. Many organizations have worked intentionally to improve equity, transparency, and work-life balance. As a result, expectations around salary growth, retirement benefits, and cost-of-living adjustments have risen.  That is not a failure. It often reflects a healthier culture. The challenge arises when revenue is …

Compensation conversations are among the most difficult challenges not-for-profit leaders face. Many organizations have worked intentionally to improve equity, transparency, and work-life balance. As a result, expectations around salary growth, retirement benefits, and cost-of-living adjustments have risen. 

That is not a failure. It often reflects a healthier culture. The challenge arises when revenue is stable or limited, and financial realities do not support the level of compensation staff reasonably hope for. 

Navigating these conversations requires clarity, honesty, and structure. 

Start With Shared Financial Understanding 

Transparency alone is not enough. Sharing a budget spreadsheet without context can create confusion or misinterpretation. Staff need to understand not only the numbers, but what those numbers mean. 

Leadership should clearly explain: 

  • Where revenue comes from and how predictable it is 
  • Which expenses are fixed and which are flexible 
  • What obligations must be met before compensation increases are possible 
  • How cash reserves factor into sustainability 

When everyone understands the financial constraints, conversations shift from frustration to shared problem-solving. 

Separate Values From Financial Capacity 

Many not-for-profit organizations are mission-driven and equity-focused. Staff can advocate for fair wages and financial stability while still believing in broader social change. Those values are not in conflict. 

However, leadership must distinguish between what the organization values and what it can currently afford. A clear compensation philosophy helps. For example: 

  • Are salaries benchmarked to market data? 
  • Is there a formal approach to cost-of-living adjustments? 
  • How are raises prioritized when funding is limited? 

Documenting and communicating this framework reduces ambiguity and supports fairness, even when resources are tight. 

Provide Clear Timelines, Not Vague Promises 

It can be tempting to soften difficult news with hopeful language. Doing so often creates greater disappointment later. 

If benefit enhancements or salary increases are possible only after certain financial milestones are reached, say so clearly. For example: 

  • A retirement match may be feasible after a defined revenue target is achieved. 
  • Cost-of-living adjustments may depend on grant renewals or fundraising growth. 

Concrete conditions and timelines build trust. Unclear commitments weaken it. 

Create Structured, Ongoing Dialogue 

Compensation discussions should not happen only when frustration surfaces. Consider regular check-ins tied to budgeting and year-end planning cycles. 

Structured conversations might include: 

  • What feels most financially unsustainable for staff right now? 
  • What incremental improvements are realistic this fiscal year? 
  • If limited funds become available, how should they be prioritized? 

These discussions allow leadership to remain transparent while reinforcing financial stewardship. 

Protect Organizational Sustainability 

It is natural to want to meet staff expectations. Strong leaders care about their teams. However, increases that compromise long-term sustainability place both mission and jobs at risk. 

Sound financial governance requires balancing compassion with responsibility. That may mean saying no in the short term to protect the organization’s future. 

The goal is not universal satisfaction. It is maintaining credibility, fairness, and fiscal stability. 

How DBC Supports Not-for-Profit Leaders 

Compensation planning requires alignment between mission values and financial reality. At DBC, our not-for-profit specialists work with organizations to evaluate compensation structures, assess revenue capacity, and build sustainable financial models. Clear frameworks and proactive planning make difficult conversations more productive and less reactive. 

To read the original article by Sara Hudson, please visit https://nonprofitquarterly.org/what-do-you-do-when-your-nonprofit-staff-want-raises-we-cant-afford 

Key Performance Indicators for Measuring Not-for-Profit Success

Measuring success in a not-for-profit organization is rarely simple. Financial results matter, but they do not tell the full story. Mission impact, program quality, community trust, and long-term sustainability all shape what success really looks like.  Key performance indicators, or KPIs, can bring structure to that complexity. When thoughtfully selected, they help leadership and …

Measuring success in a not-for-profit organization is rarely simple. Financial results matter, but they do not tell the full story. Mission impact, program quality, community trust, and long-term sustainability all shape what success really looks like. 

Key performance indicators, or KPIs, can bring structure to that complexity. When thoughtfully selected, they help leadership and boards track progress, support informed decision-making, and strengthen accountability. 

Start With a Clear Definition of Success 

Before choosing KPIs, leadership must define what strong performance means for the organization. That definition should reflect mission priorities while also recognizing stakeholder expectations. 

Consider questions such as: 

  • What outcomes define success for the communities we serve? 
  • How do funders measure performance? 
  • What does the board need to oversee effectively? 
  • What systems are in place to gather reliable data? 
  • How will data be used to guide improvement, not just reporting? 

Without clarity at this stage, KPIs risk becoming disconnected from strategy. 

Focus on Strategic Indicators, Not Everything You Can Measure 

KPIs are not an inventory of every data point available. They are a focused set of indicators that reflect meaningful progress and organizational health. 

Most organizations benefit from a mix of: 

  • Lead indicators, which signal future performance. Examples include donor engagement levels, program inquiries, or grant pipeline activity. 
  • Lagging indicators, which measure results already achieved. Examples include program completion rates, client outcomes, retention statistics, or year-over-year revenue stability. 

A balanced approach provides insight into both current results and future trajectory. 

Align KPIs With Your Business Model 

Effective KPIs are grounded in how the organization operates. Leadership should understand both revenue drivers and cost structures before finalizing what to measure. 

Important considerations include: 

  • Reliability and predictability of revenue streams 
  • Donor retention and fundraising efficiency 
  • Key cost drivers and expense trends 
  • Program-delivery metrics that influence participation and outcomes 

When KPIs reflect real operational drivers, they become practical tools rather than abstract numbers. 

Use Dashboards to Strengthen Oversight 

Many not-for-profits organize KPIs into dashboards for leadership and board review. A well-designed dashboard makes performance conversations more focused and productive. 

However, dashboards only add value when they are actively used. KPIs should be reviewed regularly, discussed openly, and adjusted as strategy evolves. Indicators that made sense during a strategic-planning cycle may need refinement as priorities shift. 

Keeping KPIs visible and relevant reinforces accountability and continuous improvement. 

Be Mindful of Unintended Incentives 

Measurement influences behavior. Poorly designed KPIs can unintentionally reward the wrong outcomes. For example, focusing solely on program volume may overlook service quality. Emphasizing short-term fundraising targets may distract from long-term donor relationships. 

Leadership should periodically assess whether KPIs are reinforcing the organization’s mission and values. 

Integrate KPIs Into Strategic Governance 

KPIs work best when tied directly to strategic goals and governance practices. They should support board oversight, guide management discussions, and inform year-end planning and budgeting decisions. 

When integrated thoughtfully, KPIs become more than a reporting requirement. They provide clarity around priorities and strengthen long-term sustainability. 

At DBC, our not-for-profit specialists work with organizations to develop meaningful performance indicators, align financial strategy with mission goals, and implement reporting systems that support transparency and sound governance. 

To read the original article by Jeanne Bell, please visit https://nonprofitquarterly.org/what-are-key-performance-indicators-kpis-to-measure-nonprofit-success/ 

Developing Internal Controls to Prevent Embezzlement 

For a not-for-profit organization, trust is a major part of your work. Donors give because they believe in your mission. Board members and staff give their time because they care. The communities you serve rely on you to be responsible with every dollar. That is exactly why internal controls matter. Even well-run organizations can be vulnerable to fraud …

For a not-for-profit organization, trust is a major part of your work. Donors give because they believe in your mission. Board members and staff give their time because they care. The communities you serve rely on you to be responsible with every dollar. 

That is exactly why internal controls matter. 

Even well-run organizations can be vulnerable to fraud when processes are informal, oversight is limited, or one person is handling too much. Putting the right controls in place is not about suspicion. It is about protecting the organization, the mission, and the people who depend on it. 

Understanding the Risk 

Embezzlement happens when someone misuses funds or assets they have access to. In many cases, it does not start with one large transaction. It starts small and grows over time, especially when no one is reviewing the details. 

Not-for-profits can be at higher risk because: 

  • Staffing is often lean 
  • Leadership may rely heavily on trust and long-standing relationships 
  • Administrative duties are sometimes spread thin 
  • Financial tasks may fall to one person out of necessity 

The goal is not to assume the worst. The goal is to avoid a situation where one mistake or one bad decision goes unnoticed for too long. 

Common Red Flags to Watch For 

Fraud rarely announces itself clearly, but there are warning signs worth paying attention to, such as: 

  • Unexplained fluctuations in account balances 
  • Missing receipts or incomplete documentation 
  • Reconciliations that are delayed or not completed 
  • Unusual vendor payments or reimbursements 
  • A staff member who resists oversight or refuses to take time off 

Red flags do not always mean fraud, but they should always lead to follow-up. 

Why Internal Controls Matter 

Internal controls are the basic safeguards that keep financial operations accurate, consistent, and reviewable. When they are working well, they help an organization stay organized and reduce preventable risk. 

Strong internal controls can help you: 

  • Reduce opportunities for misuse of funds 
  • Catch errors early, before they snowball 
  • Improve financial reporting and board oversight 
  • Strengthen confidence with donors and grantors 

Controls do not have to be complicated to be effective. They simply need to be consistent. 

Practical Internal Controls to Strengthen 

Below are a few internal control strategies we often recommend for not-for-profit organizations. Some can be implemented quickly, while others may require a policy update or a shift in workflow. The right mix depends on your team size, responsibilities, and day-to-day operations. 

  1. Separate Financial Responsibilities

One person should not be responsible for authorizing payments, entering transactions, and reconciling accounts. 

Even in a small organization, there are ways to introduce separation. For example, a board member can review bank statements, or a second person can approve payments over a certain dollar amount. 

  1. Create Clear Approval Rules

Written approval policies reduce confusion and prevent uncomfortable “gray areas.” 

A strong policy should define: 

  • Who can approve expenses 
  • Spending limits by role 
  • When dual approval is required 
  • Whether checks, electronic payments, and reimbursements follow the same rules 

Clear, written rules protect everyone involved by reducing uncertainty, keeping approvals consistent, and making financial decisions easier to support later. 

  1. Complete Bank Reconciliations Every Month

Monthly bank reconciliations are one of the simplest and most effective controls available. 

Best practice is to have someone independent review them, even if they are not the person completing them. The goal is to confirm accuracy and make sure unusual activity is identified quickly. 

  1. Review Financial Reports Consistently

Financial statements should be reviewed throughout the year, not filed away and revisited months later. Regular review is one of the most effective ways to strengthen oversight, catch errors early, and reduce the risk of inappropriate activity going unnoticed. 

At a minimum, leadership and the board should review: 

  • Monthly financial statements 
  • Budget-to-actual comparisons 
  • Unusual variances or unexpected trends 
  • Major vendor payments and reimbursements 

Consistent review creates accountability and helps confirm that financial activity matches what the organization expects. It also makes it much easier to spot concerns early, while they are still manageable. 

  1. Tighten Reimbursement and Expense Documentation

Expense reimbursement policies should require: 

  • Receipts 
  • Clear descriptions of the expense 
  • Approval before reimbursement 

If possible, reduce cash activity and move transactions to traceable payment methods. Electronic payments create a clearer paper trail, improve documentation, and make it easier to review activity later. 

  1. Use Software Access Controls

Your accounting system should have individual user logins with appropriate permissions. Not everyone needs access to everything. 

A few practical safeguards include: 

  • Limiting access to bank and payment functions 
  • Enabling audit trails 
  • Removing access immediately when staff transitions occur 
  • Reviewing user permissions at least annually 

These settings matter more than most organizations realize. 

  1. Schedule Periodic Reviews or Outside Support

Independent review strengthens accountability. Depending on your size and reporting requirements, that may include: 

  • Internal review by a finance committee 
  • An external bookkeeping review 
  • Audit preparation support 
  • An annual financial statement audit 

This is not only about meeting requirements. It is about catching problems early and putting better systems in place so that they do not repeat. 

  1. Build a Culture of Accountability

The strongest internal controls are supported by a healthy workplace culture. 

That includes: 

  • Encouraging questions 
  • Making it safe to raise concerns 
  • Setting clear expectations for documentation 
  • Reinforcing that oversight is normal and responsible 

Good controls work best when everyone understands their purpose. 

How De Boer, Baumann & Company Can Help 

De Boer, Baumann & Company works with not-for-profit organizations to strengthen internal controls in a way that is practical and sustainable. We help organizations evaluate existing processes, identify gaps, and put safeguards in place that fit the size and needs of the team. 

If you would like guidance on internal controls, financial oversight, or audit readiness, please contact us. We would be glad to help you reduce risk and strengthen the systems that support your mission. 

Strategies for Managing Restricted vs. Unrestricted Funds 

For not-for-profit organizations, every contribution supports the mission. But not every dollar can be used the same way. Understanding the difference between restricted and unrestricted funds is a core part of financial stewardship, and it directly impacts compliance, budgeting, and transparency. When these funds are tracked properly, organizations can honor donor intent while still maintaining the flexibility needed to …

For not-for-profit organizations, every contribution supports the mission. But not every dollar can be used the same way. Understanding the difference between restricted and unrestricted funds is a core part of financial stewardship, and it directly impacts compliance, budgeting, and transparency. 

When these funds are tracked properly, organizations can honor donor intent while still maintaining the flexibility needed to cover operations and plan ahead. Strong fund management also builds trust with donors, grantors, board members, and the broader community. 

Understanding Restricted and Unrestricted Funds 

Not-for-profit organizations receive funding from many sources, including individual donors, grants, sponsorships, and fundraising events. Some funds are restricted to a specific purpose, while others are available for general use. Knowing the difference can help your organization plan responsibly, stay compliant, and report clearly. 

Restricted Funds 

Restricted funds are contributions designated for a specific program, project, or purpose. The donor or grantor sets the terms, and the organization is responsible for using the funds exactly as intended. 

Common examples include: 

  • A grant restricted to youth education programming 
  • A donation earmarked for a building renovation 
  • A gift intended to fund a specific event or campaign 

Because restricted funds come with conditions, they often require more detailed tracking and reporting. This helps ensure the organization stays compliant while maintaining a clear audit trail. 

Unrestricted Funds 

Unrestricted funds can be used at the organization’s discretion. These dollars support general operating needs such as payroll, rent, insurance, technology, and administrative costs. 

Unrestricted support may not feel as exciting as program-based giving, but it often makes the biggest difference behind the scenes. It is what keeps the organization running between grants, seasonal fundraising, or large projects. 

Why the Balance Matters 

A healthy not-for-profit needs both restricted and unrestricted funds. 

Restricted funding can strengthen programs and support growth, but too much restricted funding can create cash pressure. It is common for an organization to have strong program funding on paper while still struggling to cover basic operating expenses. 

On the other hand, relying too heavily on unrestricted funding may limit the ability to expand programs or pursue larger initiatives. 

The goal is a balanced funding structure that supports both mission impact and financial stability. 

Practical Strategies for Managing Funds Well 

Managing restricted and unrestricted funds does not have to be complicated, but it does require consistency. Here are a few best practices we often recommend: 

  1. Use an Accounting System That Supports Fund Tracking

Your accounting system should allow you to track funds by restriction, program, or funding source. This might be done through separate fund accounts, classes, or departments depending on the software setup. 

The right structure makes reporting easier and helps reduce errors when funds are spent. 

  1. Document Donor Restrictions Clearly

Restrictions should be confirmed in writing before funds are accepted and deposited. If the terms are unclear, it is worth clarifying them up front rather than trying to interpret them later. 

Clear documentation protects the donor and the organization, and it makes financial reporting more straightforward. 

  1. Review Restricted Fund Activity Regularly

Restricted fund balances should be reviewed on a consistent schedule, ideally monthly. This helps confirm that: 

  • Expenses are being coded correctly 
  • Spending aligns with grant or donor requirements 
  • Funds are available before commitments are made 

Regular reviews also help prevent restricted funds from sitting unused when the organization could be making progress on the intended purpose. 

  1. Establish an Indirect Cost Allocation Policy 

Many grants do not cover the full cost of running a program. Administrative support, technology, payroll processing, and facility expenses often benefit multiple programs at once. 

A clear cost-allocation policy helps ensure these shared expenses are applied consistently and documented properly, while staying within grant guidelines. 

  1. Make Sure Staff and Board Members Understand Restrictions

Fund restrictions are not just an accounting issue. They affect leadership decisions and spending approvals. 

Training staff and board members on restricted versus unrestricted funds helps avoid accidental misuse and improves financial decision-making across the organization. 

  1. Strengthen Unrestricted Giving Through Clear Messaging

Not-for-profits often hesitate to ask for unrestricted support, but many donors are willing when the need is explained clearly. 

Sharing how unrestricted funds support staffing, operations, and mission continuity can help donors understand why flexible giving matters. A stronger base of unrestricted support can also reduce financial stress during slower fundraising periods. 

Building Transparency and Trust 

Strong fund management supports more than compliance. It strengthens confidence. 

When financial reporting is clear and restrictions are handled properly, donors and grantors are more likely to continue giving. Board members can make decisions with better information, and the organization can plan ahead with fewer surprises. 

Transparency is not just a reporting goal. It is one of the strongest ways to demonstrate responsible stewardship. 

How De Boer, Baumann & Company Can Help 

De Boer, Baumann & Company works with not-for-profit organizations to strengthen financial systems, improve fund tracking, and support clear, compliant reporting. 

If you would like guidance on your accounting setup, restricted fund reporting, or budgeting and planning, please contact us. We would be happy to help you build a clear financial foundation that supports your mission year after year. 

Using QuickBooks to Manage Your Not-For-Profit’s Grants and Donations 

For not-for-profit organizations, effectively managing grants and donations is vital to fulfilling the mission and maintaining trust with donors, grantors, and the community. Yet as funding sources diversify and reporting requirements grow more complex, keeping everything organized can quickly become a challenge.  That’s where QuickBooks comes in. With its not-for-profit specific tools and customizable features, QuickBooks …

For not-for-profit organizations, effectively managing grants and donations is vital to fulfilling the mission and maintaining trust with donors, grantors, and the community. Yet as funding sources diversify and reporting requirements grow more complex, keeping everything organized can quickly become a challenge. 

That’s where QuickBooks comes in. With its not-for-profit specific tools and customizable features, QuickBooks can help your organization track revenue, manage expenses, and maintain compliance with funding requirements, all in one place. 

Why Financial Tracking Matters in the Not-For-Profit World 

Not-for-profits have unique financial management needs. Unlike for-profit businesses, their accounting systems must distinguish between restricted and unrestricted funds, track grant spending by purpose, and produce accurate reports for funders and boards alike. 

A strong financial tracking system helps your organization: 

  • Maintain compliance with grant agreements and donor restrictions 
  • Provide accurate, transparent financial statements to stakeholders 
  • Identify funding gaps and opportunities for improvement 
  • Strengthen long-term sustainability and accountability 

When used effectively, QuickBooks can make these tasks simpler, more efficient, and more reliable. 

Setting Up QuickBooks for Not-For-Profit Success 

QuickBooks offers specialized features that can be customized for not-for-profit operations. Setting it up properly from the start ensures smoother day-to-day management and easier reporting down the road. 

1. Use Classes and Locations to Track Grants 

QuickBooks allows you to use Classes or Locations to separate activities by grant, program, or funding source. This enables you to see how each project is performing financially, monitor spending limits, and prepare reports tailored to funder requirements. 

2. Create a Chart of Accounts That Fits Your Mission 

Your Chart of Accounts should reflect the nature of your not-for-profit’s work. Set up income and expense categories specific to grants, fundraising campaigns, or donor programs. This structure makes it easier to analyze results and communicate financial information clearly. 

3. Record Donations Accurately 

Use QuickBooks’ donation tracking features to record contributions by donor, campaign, or type of support (cash, in-kind, pledges). Integrating donor management tools or platforms like DonorPerfect or Kindful can further streamline the process and reduce manual data entry. 

4. Track Restricted and Unrestricted Funds 

Donor-restricted funds must be tracked separately from general operating funds to ensure compliance and proper reporting. QuickBooks allows you to assign restrictions to income accounts or use sub-accounts to maintain clarity around how funds can be used. 

5. Reconcile Regularly and Review Reports 

Monthly reconciliations ensure that all grant and donation transactions are accurate and up to date. Generate reports such as Statement of Activities, Statement of Financial Position, and Budget vs. Actual to monitor performance and provide updates to your board and funders. 

Leveraging QuickBooks for Grant Compliance 

Grant management requires careful documentation of how funds are spent. With QuickBooks, not-for-profits can easily attach receipts, track program expenses, and generate fund-specific reports to meet grantor requirements. 

By using custom reports, your team can: 

  • Compare actual expenses to approved grant budgets 
  • Track spending by category or funding source 
  • Demonstrate compliance in audits or grant closeout reports 

Having this level of visibility not only simplifies compliance but also strengthens relationships with funders who value accountability and transparency. 

Strengthening Donor Relationships Through Reporting 

Donors and sponsors want to see the impact of their contributions. With QuickBooks’ customizable reporting tools, not-for-profits can generate clear, meaningful financial reports that highlight how donations are being used to advance the mission. 

Sharing timely, accurate reports builds trust and encourages continued support. It also equips your development team with data to demonstrate outcomes and apply for new grants more effectively. 

How De Boer, Baumann & Company Can Help 

Not-for-profit organizations often need more than just software to manage grants and donations effectively. They need financial systems that are thoughtfully set up and supported over time. At De Boer, Baumann & Company, our CAAS team works with not-for-profits to implement, optimize, and maintain QuickBooks in a way that fits their programs, funding sources, and reporting responsibilities.

Whether managing multiple grants, navigating compliance requirements, or looking to simplify day-to-day processes, our team provides practical, hands on support. Our goal is provide organizations with clear reporting, reliable data, and financial systems that allow them to stay focused on their mission and long-term impact.

 

How to Prepare for a Not-For-Profit Financial Statement Review 

For not-for-profit organizations, financial transparency is more than a best practice, it’s a responsibility. Donors, board members, and grantors rely on accurate financial reporting to understand how resources are being used and to make informed decisions about future support.  A financial statement review provides an added level of credibility and assurance without the full scope of an audit. …

For not-for-profit organizations, financial transparency is more than a best practice, it’s a responsibility. Donors, board members, and grantors rely on accurate financial reporting to understand how resources are being used and to make informed decisions about future support. 

A financial statement review provides an added level of credibility and assurance without the full scope of an audit. Understanding what to expect and how to prepare can help your organization approach the review process efficiently and confidently. 

What Is a Financial Statement Review? 

A financial statement review is a type of assurance service in which a CPA evaluates your organization’s financial statements to determine whether they are free of material misstatements. Unlike an audit, a review does not involve testing internal controls or verifying transactions, but it does provide limited assurance that the financial statements are presented in accordance with generally accepted accounting principles (GAAP). 

A review is often required by lenders, grantors, or boards of directors when an organization requires an independent level of limited assurance that its financial statements conform to professional standards, without the extensive procedures of a full audit. It serves as a middle ground for growing organizations that have moved beyond a simple compilation but do not yet necessitate a full-scope audit.

Why a Review Matters 

While less extensive than an audit, a financial statement review still offers significant benefits to not-for-profit organizations. It helps: 

  • Increase credibility with funders and donors 
  • Identify inconsistencies or potential issues in financial reporting 
  • Strengthen internal accounting processes 
  • Provide valuable insights into your organization’s financial health 

A review can also serve as a stepping stone toward future audits as your organization grows and financial reporting requirements expand. 

How to Prepare for a Financial Statement Review 

Preparation is key to a smooth and successful review process. Here are several steps your not-for-profit can take to get ready: 

1. Organize Your Financial Records 

Ensure your accounting records are complete and accurate. This includes general ledgers, bank reconciliations, accounts payable and receivable schedules, and payroll documentation. Organized financial data allows your CPA to conduct the review efficiently and minimizes follow-up questions. 

2. Reconcile All Accounts 

Before the review begins, verify that all bank, investment, grant, and liability accounts are reconciled through the end of the reporting period.

3. Review Revenue and Expense Classifications 

Make sure revenues and expenses are properly classified according to your chart of accounts. For not-for-profits, this includes distinguishing between restricted and unrestricted funds and separating program, management, and fundraising expenses. 

4. Prepare Supporting Documentation 

Your CPA will likely request supporting documents for significant transactions, grants, or contributions. Having invoices, contracts, and grant agreements readily available will help the process move quickly. 

5. Evaluate Internal Controls 

Even though a review does not include formal testing of internal controls, it’s a good opportunity to assess your systems for managing cash, approving expenses, and safeguarding assets. Addressing weaknesses ahead of time can strengthen your financial management and reduce future risk. 

6. Communicate with Your CPA 

Schedule a pre-review meeting to discuss timelines, expectations, and any major changes in your organization’s operations or funding sources. Clear communication helps ensure that the review focuses on what’s most important to your organization. 

What to Expect During the Review 

During a financial statement review, your CPA will perform analytical procedures, ask management questions, and review documentation to assess the accuracy of your financial statements. The goal is to confirm that your financials make sense based on your organization’s activities and records. 

At the conclusion of the process, your organization will receive reviewed financial statements accompanied by an Independent Accountant’s Review Report. This report provides limited assurance that the accountant is not aware of any material modifications that should be made to the financial statements for them to be in accordance with GAAP.

Strengthening Financial Confidence 

Completing a financial statement review is more than a compliance exercise, it’s an opportunity to gain a clearer picture of your organization’s financial standing. The insights you receive can guide better decision-making, support future funding requests, and reinforce the trust of your board and community. 

Regular reviews also help not-for-profits build stronger accounting practices and prepare for potential audits down the road. 

How De Boer, Baumann & Company Can Help 

At De Boer, Baumann & Company, we understand the importance of reliable financial reporting in the not-for-profit sector. Our experienced professionals provide tailored review and assurance services designed to meet your organization’s specific needs. 

From preparing your records and guiding you through the review process to offering recommendations for stronger financial practices, our team is here to help you achieve clarity, confidence, and compliance. Let us help you focus on your mission, while we take care of the numbers. 

Navigating Payroll and Benefits Compliance in Not-For-Profits 

Managing payroll and employee benefits is an essential part of running any organization, but for Not-For-Profits, compliance can be particularly complex. Between balancing limited resources, managing multiple funding sources, and navigating specific labor laws, Not-For-Profit leaders often face unique challenges in ensuring payroll accuracy and regulatory compliance.  Understanding the rules and implementing sound systems helps protect your …

Managing payroll and employee benefits is an essential part of running any organization, but for Not-For-Profits, compliance can be particularly complex. Between balancing limited resources, managing multiple funding sources, and navigating specific labor laws, Not-For-Profit leaders often face unique challenges in ensuring payroll accuracy and regulatory compliance. 

Understanding the rules and implementing sound systems helps protect your organization, your employees, and your reputation, allowing you to stay focused on your mission. 

Why Payroll Compliance Matters 

Payroll errors and compliance issues can lead to significant financial penalties, reputational harm, and even loss of grant funding. Not-For-Profits must comply with the same payroll and employment laws as for-profit entities, while also adhering to additional reporting and documentation requirements tied to restricted funds and grants. 

Strong payroll and benefits management practices help your organization: 

  • Maintain compliance with federal and state labor laws 
  • Ensure proper use of grant and donor funds 
  • Improve employee satisfaction and retention 
  • Reduce administrative errors and audit risks 

When compliance is prioritized, your organization can operate with greater efficiency and confidence. 

Key Areas of Payroll Compliance for Not-For-Profits 

1. Proper Employee Classification 

Accurate employee classification is critical. Misclassifying employees as independent contractors or exempt vs. nonexempt can result in fines and back pay obligations. Review each position carefully to ensure it aligns with the Fair Labor Standards Act (FLSA) and state regulations. 

2. Accurate Wage and Hour Tracking 

Not-For-Profits must comply with federal and state minimum wage laws, overtime requirements, and recordkeeping standards. Implementing reliable time-tracking systems ensures that employees are paid correctly and that required records are properly maintained. 

3. Grant and Program Payroll Allocation 

If your Not-For-Profit receives grant funding, payroll costs may need to be allocated across multiple programs or funding sources. Maintain detailed records showing how employee time and compensation are divided to comply with grant reporting requirements and avoid disallowed costs. 

4. Tax Withholding and Reporting 

Even though Not-For-Profits may be tax-exempt, they are still required to withhold and remit payroll taxes for employees. Stay current with federal, state, and local tax filing deadlines, and ensure all forms, such as W-2s and 1099s, are issued accurately and on time. 

5. Benefits Administration and Compliance 

Offering benefits such as health insurance, retirement plans, and paid leave requires compliance with laws like the Affordable Care Act (ACA) and ERISA. Ensure your benefits programs are administered correctly, and review eligibility and contribution rules annually. 

Best Practices for Managing Payroll and Benefits 

To stay compliant and organized, Not-For-Profits should implement proactive payroll and benefits management strategies. 

Establish Clear Policies and Procedures 

Document payroll policies covering timekeeping, overtime, leave accrual, and expense reimbursements. Clearly communicate these policies to employees and ensure consistent application across all departments. 

Leverage Payroll Technology 

Using payroll software or outsourcing to a reputable payroll provider can simplify tax filings, automate reporting, and reduce human error. Many platforms integrate with accounting systems like QuickBooks, helping Not-For-Profits track payroll expenses by fund or program. 

Conduct Regular Reviews 

Perform periodic internal reviews of payroll processes, classifications, and benefits administration to ensure ongoing compliance. Regular reviews can help identify errors early and prepare your organization for external audits or reviews. 

Stay Informed About Changing Regulations 

Labor and tax laws evolve frequently. Designate a staff member or advisor to monitor updates from the Department of Labor, IRS, and state agencies. Partnering with professionals who specialize in Not-For-Profit compliance can help your organization stay ahead of changes. 

Building Confidence in Compliance 

Payroll and benefits compliance may not be the most visible part of your Not-For-Profit’s work, but it’s one of the most critical. Ensuring accuracy, transparency, and accountability in these areas supports your employees, protects your funding, and reinforces the trust your community places in your organization. 

By building strong systems and partnering with experienced advisors, your Not-For-Profit can manage compliance with confidence, allowing your team to focus on what matters most: making a difference. 

How De Boer, Baumann & Company Can Help 

At De Boer, Baumann & Company, our Client Accounting & Advisory Services (CAAS) team works closely with not-for-profit organizations to navigate complex payroll, benefits, and compliance requirements with confidence. We provide practical payroll consulting, internal control support, and ongoing accounting services designed to promote accuracy, consistency, and regulatory compliance.

Whether you’re implementing a new payroll system, managing multiple grants, or reviewing benefits administration, our CAAS professionals help strengthen your processes and reduce risk. With the right systems and support in place, your team can spend less time on compliance concerns and more time advancing your mission.

 

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Preparing for 2026–27: What Not-for-Profit Leaders Need to Know About the New Charitable Giving Rules

The passage of the 2025 Reconciliation Act, often referred to as the “One Big Beautiful Bill Act” (OBBBA), introduced sweeping updates to federal charitable giving regulations that will begin taking effect in 2026 and 2027. These changes will have far-reaching implications for not-for-profits, donors, and fundraisers across all sectors. For not-for-profit leaders, now is …

The passage of the 2025 Reconciliation Act, often referred to as the “One Big Beautiful Bill Act” (OBBBA), introduced sweeping updates to federal charitable giving regulations that will begin taking effect in 2026 and 2027. These changes will have far-reaching implications for not-for-profits, donors, and fundraisers across all sectors.

For not-for-profit leaders, now is the time to plan ahead. Understanding the new giving landscape early will help organizations adapt their fundraising strategies, communicate effectively with donors, and safeguard financial stability in the years ahead.

Key Changes to Charitable Giving Rules

A recent report from Arts, Culture, and Media Philanthropic Advisors, titled One Big Beautiful Bill Act and Charitable Giving in 2026: Guidance for Fundraisers, outlines several significant updates that will affect how individuals and corporations give.

Expanded Deduction for Non-Itemizers

Starting in 2026, taxpayers who do not itemize will be eligible for a charitable deduction on cash contributions, up to $1,000 for individuals and $2,000 for joint filers. Donations to private foundations and donor-advised funds do not qualify, and these amounts will not be adjusted for inflation. This change reintroduces a version of the universal charitable deduction, designed to encourage everyday donors to give.

Permanent 60 Percent Limit for Individual Cash Gifts

The new law makes permanent the increased deduction limit, 60% of adjusted gross income (AGI), for individuals contributing cash gifts to qualified charitable organizations. This continues a provision that had been temporary under prior legislation, ensuring greater flexibility for generous donors.

New 0.5 Percent Floor for Itemizers

Beginning in 2026, taxpayers who itemize may only deduct charitable gifts that exceed 0.5% of their AGI. In addition, those in the top tax bracket (37%) will receive a slightly reduced deduction value, 35 cents on the dollar rather than 37. While the difference may seem small, this adjustment could influence high-income donors’ giving behaviors.

Tax Credit for Scholarship Contributions

In 2027, a new tax credit of up to $1,700 will be available to taxpayers contributing to eligible scholarship-granting organizations that support students at private or religious K–12 schools. This credit will apply regardless of whether the taxpayer itemizes deductions, creating a new incentive for education-focused giving.

Corporate Deduction Floor Introduced

Corporate charitable giving will also be affected. Beginning in 2026, businesses can only deduct charitable donations that exceed 1% of taxable income, up to a ceiling of 10%. This change could encourage larger or multi-year giving commitments from corporate partners but may also require not-for-profits to adjust their approach to sponsorship and corporate engagement.

What These Changes Mean for Not-for-Profits

The new rules create both challenges and opportunities for not-for-profit organizations. While they may increase participation among smaller, non-itemizing donors, they could also complicate giving strategies for major donors and corporate partners. Strategic planning will be essential to help not-for-profits maintain balance across their donor bases.

1. Engaging Everyday Donors

The reinstated universal deduction for non-itemizers provides an opportunity to engage a wider pool of small donors. Not-for-profits should build fundraising campaigns that highlight how even modest contributions now carry tangible tax benefits. Messaging that connects giving directly to impact, such as “Your $100 gift not only supports our mission but is now tax-deductible”, can inspire participation from new supporters.

The upcoming scholarship tax credit also opens doors for organizations connected to education or youth programs. Communicating this new benefit early can help donors plan ahead and strengthen relationships with supporters interested in education equity.

2. Planning for Itemizers and Major Donors

For high-income donors and those who itemize, the 0.5% deduction floor and top-tier reduction may prompt new giving strategies. Fundraisers should be ready to discuss “bunching”, a method where donors concentrate multiple years of charitable giving into one tax year to exceed deduction thresholds and maximize impact.

Not-for-profits can also encourage legacy giving and planned gifts as donors evaluate long-term financial strategies. With the Act’s increase in estate and gift tax exemptions to $15 million for individuals and $30 million for couples, there’s greater opportunity for philanthropic estate planning that aligns with organizational sustainability goals.

3. Strengthening Corporate Partnerships

The new 1% minimum for deductible corporate giving means businesses will need to contribute at least that share of taxable income to qualify. Not-for-profits should position themselves as strategic partners by proposing multi-year sponsorships, collaborative campaigns, or pooled giving initiatives that help corporate donors meet thresholds while achieving meaningful community outcomes.

This shift may also prompt companies to become more intentional in selecting not-for-profit partners, valuing transparency, measurable results, and mission alignment more than ever before.

Turning Policy Changes into Strategic Opportunity

The OBBBA reforms introduce a mix of opportunities and challenges for the not-for-profit sector. While the expanded universal deduction could increase small-donor giving, the new floors and limits may temper large-scale contributions. Success in this new environment will depend on thoughtful, proactive engagement.

Not-for-profits should begin scenario planning now, reviewing donor data, updating messaging, and educating their supporters about how the rules will affect them. Creating segmented outreach strategies for small donors, major donors, and corporate partners will help organizations adapt smoothly to the evolving landscape.

How De Boer, Baumann & Company Can Help

At De Boer, Baumann & Company, we help not-for-profit navigate the complex intersection of tax regulation, fundraising, and financial strategy. Our team works alongside not-for-profit leaders to understand the implications of legislative changes, model potential impacts, and develop proactive approaches to donor engagement and compliance.

We partner with organizations to ensure they are prepared for what’s next, so they can continue focusing on what matters most: advancing their missions and strengthening their communities.

To read the full article by Timothy J. McClimon, please visit Forbes.

About us

De Boer, Baumann & Company provides professional accounting, tax, and business advisory services to individuals and businesses in West Michigan and the surrounding areas. With expertise in a variety of industries, DBC specializes in comprehensive and innovative solutions to help clients achieve their financial goals.