Non-Profit Posts

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 partner with you to define the right performance indicators, align financial strategy with your mission, and build reporting systems that strengthen transparency and governance. If you are ready to measure what truly matters and lead with clarity, we are here to help you put the right structure in place.

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.

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Facebook and Volunteer Engagement: Maximizing Opportunity While Managing Risk

In an era of rapid social media change, it’s easy to overlook Facebook in favor of newer platforms like TikTok or Instagram. Yet despite its age, Facebook remains one of the most powerful communication tools available to nonprofits. According to the Pew Research Center, roughly seven in ten U.S. adults still use Facebook, making …

In an era of rapid social media change, it’s easy to overlook Facebook in favor of newer platforms like TikTok or Instagram. Yet despite its age, Facebook remains one of the most powerful communication tools available to nonprofits. According to the Pew Research Center, roughly seven in ten U.S. adults still use Facebook, making it one of the most widely used social platforms in the country.

For organizations seeking to connect with supporters, mobilize volunteers, and strengthen community engagement, Facebook continues to offer immense value. However, it also poses distinct challenges, particularly around data privacy, audience reach, and platform ethics. Understanding how to balance these opportunities and risks can help nonprofits make the most of this enduring digital space.

Leveraging Facebook for Volunteer Recruitment

With 96% of nonprofits maintaining a Facebook presence, the platform remains a vital recruitment tool. To use it effectively, nonprofits should first ensure that managing Facebook activity is a defined part of someone’s job responsibilities. Consistent posting and engagement are key to staying visible in followers’ feeds.

When posting volunteer opportunities, framing matters. Each post should connect volunteer participation directly to the organization’s mission or cause.

Deadlines, incentives, and timely messaging all help spark action. Even for ongoing opportunities, creating urgency, like “Sign up by December 1 to receive a volunteer welcome kit”, can boost engagement. Nonprofits can also expand their reach by cross-posting opportunities on networks such as VolunteerMatch or local community Facebook groups.

Another effective tactic is to personalize posts. Staff or volunteer coordinators can use their own voices to make posts more relatable: “I’ll be at our river cleanup this weekend, join me in making a difference!” This approach humanizes the organization and fosters a stronger sense of connection with prospective volunteers.

Finally, using Facebook’s event tools to promote volunteer days or training sessions can drive interest. Posts should link directly to the organization’s own “Volunteer With Us” webpage rather than relying on Facebook Messenger for sign-ups, ensuring a smoother and more secure experience.

Retaining and Recognizing Volunteers

Recruitment is only half the equation. Once volunteers are on board, maintaining engagement is just as important, and Facebook can be a useful tool for this as well.

Nonprofits that collaborate with partner or “affinity” organizations, such as churches, service clubs, alumni groups, or local businesses, should follow and tag those partners on Facebook when posting volunteer updates. Tagging these organizations acknowledges their contributions and helps extend the post’s reach to broader audiences.

Encouraging volunteers to share their own photos or reflections on social media also deepens engagement. For example, a volunteer might post a picture from a community event and tag both the nonprofit and their affinity group, inspiring others to get involved.

Organizations can strengthen volunteer relationships through personalized gestures online: posting birthday wishes (with consent), tagging volunteers in event photos, or simply “liking” their posts. These small actions build connection and demonstrate appreciation, helping to sustain long-term involvement.

Protecting Volunteer Privacy

While social media helps build community, it can also expose volunteers to unwanted visibility. Nonprofits should take proactive steps to protect their supporters’ privacy and data.

  • Avoid collecting personal information directly on Facebook. Instead, direct interested individuals to a secure volunteer sign-up form on your organization’s website.

  • Obtain written consent before sharing photos or tagging volunteers. This not only ensures compliance with privacy standards but also respects individual comfort levels.

  • Include a social media permission section in volunteer applications. This form can outline how photos, names, or stories might be used in newsletters or online platforms, allowing volunteers to choose the level of exposure they’re comfortable with.

While no process can eliminate all risks, establishing clear boundaries and policies helps make social media engagement safer for both the organization and its volunteers.

The Evolving Role of Social Media in Volunteerism

Volunteer management practices have changed dramatically over the years. Where once volunteer lists were built manually from local directories, nonprofits now use digital tools to connect with supporters worldwide. Yet the core principles remain the same: consistent communication, recognition, and trust-building are still at the heart of successful volunteer engagement.

Even as new social media platforms rise and fall in popularity, Facebook continues to be an essential part of many nonprofits’ outreach and volunteer recruitment strategies. Understanding the platform’s strengths, and navigating its challenges responsibly, can help organizations expand their reach, strengthen relationships, and grow their capacity for impact.

How De Boer, Baumann & Company Can Help

At De Boer, Baumann & Company, we know that volunteer engagement is central to a nonprofit’s success. Our team helps organizations strengthen operational strategies, from financial planning to program development and digital engagement.

We partner with nonprofits to navigate evolving challenges, whether that means adopting new technology, maintaining compliance, or building systems that support sustainable growth. By combining practical expertise with a deep understanding of the nonprofit landscape, we help organizations focus on what truly matters: advancing their missions and serving their communities.

To read the full article by Jan Masaoka, please visit Nonprofit Quarterly.

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Navigating What’s Next: Legislative Opportunities and Challenges for Not-for-Profits

As Congress moves beyond the “One Big Beautiful Bill Act” (OBBBA), a new wave of legislative priorities is beginning to take shape. These shifting dynamics present both opportunities and challenges for not-for-profit organizations, especially as the federal government revisits tax policy, funding decisions, and regulatory reform. For not-for-profits that engaged in advocacy during OBBBA’s …

As Congress moves beyond the “One Big Beautiful Bill Act” (OBBBA), a new wave of legislative priorities is beginning to take shape. These shifting dynamics present both opportunities and challenges for not-for-profit organizations, especially as the federal government revisits tax policy, funding decisions, and regulatory reform.

For not-for-profits that engaged in advocacy during OBBBA’s development, there are valuable lessons to carry forward. Strategic communication and proactive engagement helped the sector secure meaningful wins, including the removal of several proposed tax hikes and the establishment of a permanent charitable deduction for non-itemizing taxpayers. Those same tactics will be critical as not-for-profits face the next round of policy debates on Capitol Hill.

Lessons from the OBBBA Experience

When OBBBA was under consideration, not-for-profits faced potential tax provisions that could have significantly reduced the resources available for mission-driven work. Through coordinated outreach and clear messaging, the sector helped lawmakers understand how additional taxes, such as those on private foundations and employee parking benefits, would negatively affect their ability to serve communities.

The result was a favorable outcome: proposed tax increases were removed, and a permanent charitable deduction was secured for the 90% of taxpayers who do not itemize their returns. This achievement underscored how effective storytelling and sector-wide advocacy can shape legislative outcomes in ways that strengthen philanthropy and community investment.

Renewed Legislative and Tax Policy Risks

While the OBBBA chapter has closed, the possibility of renewed legislative threats remains. Congressional tax committee leaders have indicated that certain tax measures removed from the bill could resurface in future discussions, potentially aimed at raising federal revenue through changes to the tax-exempt sector.

At the same time, increased scrutiny of not-for-profits by both Congress and the White House has created a more cautious political environment. Organizations should be prepared for heightened oversight, expanded reporting expectations, and new compliance requirements that could emerge as part of broader fiscal reform efforts.

IRS Reform: A Double-Edged Sword

Lawmakers are also considering an Internal Revenue Service (IRS) reform package, one that could have both positive and challenging implications for charitable organizations.

On the positive side, reform could simplify tax filing for 501(c)(3)s, reduce administrative delays, and strengthen donor privacy protections. However, critics of the not-for-profit sector may push for additional disclosure requirements, including the reporting of foreign donations or international grantmaking data.

There is also discussion around potential changes to Form 990, the core financial disclosure document for not-for-profits. While reform could bring useful modernization and transparency, poorly designed amendments could also increase administrative burden and compliance costs.

Potential Progress on Retirement and Giving Incentives

One area that may offer bipartisan cooperation is retirement reform. Lawmakers are considering proposals that could support not-for-profit employees and encourage greater charitable participation.

This may include enhancements to 403(b) retirement accounts and adjustments that allow individuals with IRAs to make charitable contributions through donor-advised funds more easily. If these proposals gain traction, they could help not-for-profits attract and retain talent while also promoting philanthropy among donors.

The Importance of Advocacy and Engagement

Not-for-profits operating in today’s political environment face both heightened scrutiny and new opportunities to shape policy. Advocacy will play a central role in determining which direction future legislation takes.

During OBBBA negotiations, the not-for-profit sector’s unified, fact-based approach helped remove several unfavorable provisions and secure lasting charitable incentives. That success demonstrates the power of consistent, constructive engagement. As Congress revisits fiscal and tax policy in the months ahead, not-for-profits must continue to advocate early, collaborate with allies, and present practical policy solutions that highlight their community impact.

By engaging lawmakers in a proactive and solutions-focused manner, not-for-profits can ensure their perspectives are included in policy decisions that directly affect their missions.

How De Boer, Baumann & Company Can Help

At De Boer, Baumann & Company, we understand that legislative changes can have significant implications for not-for-profit organizations. Our team helps clients interpret emerging policy developments, assess financial risks and opportunities, and plan strategically in response to evolving regulations.

By staying informed and engaged, not-for-profits can navigate uncertainty with confidence, protecting their resources, strengthening compliance, and continuing to deliver vital services to the communities they serve.

To read the full article by Geoffrey Paul, please visit The NonProfit Times.

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.