Lutheran Social Ministries of New Jersey’s purpose is to provide hospitality, healing and hope to those who hurt, who are in need or who have limited choices throughout the state. That might sound like a lot for one team to accomplish, but this organization lives by its ambitious and inspirational motto: “Never underestimate the capacity of one agency.”

Indeed, this organization oversees a full complement of services to help those in need. Among those served are the young in need of safe, loving homes; the elderly in need of quality compassionate care; developmentally disabled women in need of nurturing support to live a full and integrated life within their community; immigrants and refugees in need of shelter and support to become oriented to their new country; and the homeless, families and seniors in need of affordable and special housing opportunities. Lutheran Social Ministries offers a wide range of community outreach programs and services throughout the state and has become one of New Jersey’s largest providers of affordable housing for families and seniors.

“We follow our mission statement quite closely, as far as how we do what we do, and whom we serve,” says the Rev. Jerry Nugent, President and CEO of the agency. “We have lots of different programs, some of which have been around for many years and some that are fairly new. And we have a lot that we’re looking to expand into – new senior services and new family housing, to name two.”

Understanding the Challenges
To deliver its far-reaching programs and services, Lutheran Social Ministries of New Jersey operates 34 separate legal entities. From an operational perspective, that creates enormous complexity. Just ask John Johann, corporate controller.

When Johann joined the LSM/NJ in July 2006, he inherited the Sage MAS 90 accounting system that the agency had been using since 1999. While this system worked well when the agency was significantly smaller, the organization had grown in both size and complexity. They were now relying heavily on manual processes for managing those 34 different entities, plus a consolidation company.

“We had over a hundred ‘due to’ and ‘due from’ accounts at the end of every month, and we were spending days performing manual reconciliations,” Johann says.

In addition, Johann explains that the Sage MAS 90 system couldn’t easily accommodate the numerous bases of accounting that Lutheran Social Ministries is required to support. “Even though our audited consolidated financial statement is prepared using GAAP for nonprofit healthcare organizations, all of our different entities require us to use multiple comprehensive bases of accounting and different charts of accounts.”

For instance, the agency has HUD properties that follow their own accounting standards, programs that must comply with the New Jersey Housing and Mortgage Financing Agency (NJHMFA) financial statement standards, and programs that have their own traditional nonprofit social and welfare standards. As if that weren’t enough, the LSM faces Medicare and Medicaid cost report standards, and most of its grant programs have their own specific requirements for accounting reporting.

Seeking Change
Recognizing the need for a better approach, Johann initiated a search into other accounting systems. After meeting with CompuData and performing due diligence, Lutheran Social Ministries opted to upgrade from Sage MAS 90 to Sage MAS 500. By staying within the same product family, users could quickly get up-to-speed with the new system. But, even more important to Johann, MAS 500 would provide the features and functionality that the complex agency needed.  

Realizing the Benefits
After CompuData conducted a comprehensive business process review designed to flesh out inefficiencies and areas of potential improvement, along with a network audit designed to flag gaps in security, disaster recovery, and system architecture, CompuData converted LSM/NJ’s data and implemented their Sage MAS 500 system in April. The agency is seeing immediate benefits.

“Using MAS 500 with FRx gives us the ability to present our individual financial statements with various accounting methods,” he explains. “It also makes it easier for us to aggregate activity across the organization for our Board of Trustees. They like to see that consolidated activity in a detailed yet easy-to-read format.”

Johann notes that by capturing all transactions in real time, MAS 500 empowers him and his team to do their jobs more quickly and efficiently. With the time savings, they now have more bandwidth to analyze the numbers and make a real difference to the agency.

“A lot of my peers have asked me, ‘Isn’t MAS 500 only for really big companies?’ My response is that the net worth of a company isn’t necessarily correlated to the accounting complexity or the volume of transactions within an organization,” Johann explains. “I would be willing to bet that our organization – with our different programs, product lines, grants and industries – is just as complex as most Fortune 500 companies.”

Taking the Next Step
Given the success of the MAS 500 upgrade, Lutheran Social Ministries of New Jersey has now set its sights on improving the way it manages its complex budgeting process.

“Our approach had been to use 104 Excel files linked with each other from various network drives,” Johann says, adding that each of those files has at least six worksheets. “With all the broken links and overrides that have carried over from prior years, I knew that we needed a better option.”

For help, Johann and his team have again turned to CompuData. “They suggested we integrate Sage Active Planner software, giving the agency a much faster, more efficient approach to budgeting.” Sage Active Planner is an enterprise application that allows organizations to easily manage the most important financial planning processes, conduct in-depth analyses, and develop insightful business plans.

Looking Ahead
As Rev. Nugent noted, the agency has plans to further expand, and Johann feels confident that MAS 500 will offer the robust accounting support he and his team will need. “This organization is only going to grow and become more complex,” Johann says. “We needed CompuData and MAS 500 to help us manage this growth.”

With so much important work to accomplish today – and tomorrow – Lutheran Social Ministries of New Jersey is well positioned for efficiency with its new, streamlined accounting processes and sophisticated computing support.