Nonprofit Cloud Financial Management Trends
23 Jan 2019

Why Are Nonprofit Organizations Increasingly Moving Financial Management to the Cloud?

  • Community Improvement Entities
  • Educational Nonprofit Organizations
  • Faith-based Organizations
  • Nonprofit Healthcare Organizations
  • Human Services Organizations
  • International Nonprofits and NGOs
  • Membership Organizations
  • Philanthropic Organizations

Today, more and more nonprofit organizations are moving their financial management processes to the cloud. From charities, membership associations, and cultural institutions, to charter schools and faith-based organizations, nonprofits are transitioning their financial applications to the cloud to improve efficiency, increase transparency and minimize costs.

Why? Cloud financial applications have two core benefits that particularly appeal to streamlining the task of nonprofit financial management. First, the entire organization can access the financial system from anywhere at any time of day or night. Second, cloud-based applications are vastly more cost-effective than trying to install, operate, manage, and maintain your own financial management and fund accounting software. With cloud financial applications, nonprofits avoid large, upfront investments – no need to buy software, hardware, or other infrastructure. Additionally, software maintenance is handled by a vendor—not the nonprofit—so the nonprofit organization can focus financial and human resources on something far more strategic and valuable than finances…its mission. What kind of nonprofits are moving financial management to the cloud? With a focus on Sage Intacct cloud financial management software, the following are a representation of today’s nonprofit sector’s move to cloud-based financial management.

Meals on Wheels America is the leadership organization supporting the more than 5,000 community-based programs across the country that are dedicated to addressing senior isolation and hunger. The nonprofit’s challenge is to prepare the network that already serves 2.4 million Americans each year to meet the increasing demands of a rapidly growing senior population. Meals on Wheels America faced mountains of time-consuming manual accounting work, and relied on Excel to manage grant funding—which was especially problematic with restricted grants from funders that specify a particular use. Reporting was severely limited, and travel and expense accounting was still done on paper. The nonprofit led an evaluation of leading financial systems, looking for a robust solution that could integrate with other applications and run in the cloud to avoid the high costs and complexity of on-premises software. Sage Intacct proved to be the ideal solution, according to Meals on Wheels America. For the first time, Meals on Wheels America has real-time visibility into expenses booked against a particular grant. Today, the nonprofit is also better able to ensure that restricted grants are applied to their intended use, improving accountability with funders.

The Association of College Unions International (ACUI) is a nonprofit educational organization that supports thousands of campus community builders at over 500 schools around the world. The association enriches student unions through education, advocacy, and services. In recent years, many nonprofits like ACUI have been increasing the business rigor across their  operations by more proactively addressing programs that fail to hit sales goals or other KPIs. To promote this mindset, the organization’s finance team wanted better visibility into costs, profitability, and budget variance than it could get with its existing on-premises accounting system. ACUI went in search of a cloud-based solution with a modern interface. After searching for a solution, ACUI landed on Sage Intacct, with results including a six-month software payback based on business value alone, automation of several manual workflows to increase efficiency by 35 percent, as well as shortened bank reconciliations from five hours to five minutes and a 50 percent reduction in audit prep time. By eliminating old paper-based workflows for accounts payable approvals and bank reconciliations, ACUI saved several more hours each month that they shifted to other important projects. According to ACUI officials, Sage Intacct’s automated A/P workflows provide more transparency into where each expense is in the procure-to-pay cycle, and ensure that transactions are applied to the correct vendors, employees, projects, and departments.

University Clinical Health (UCH) is a nonprofit organization that offers quality primary and specialty healthcare from over 100 renowned physicians who also serve on the faculty at the University of Tennessee College of Medicine. Over the past few years, UCH has undergone a significant transformation effort, spinning off several companies and shifting its focus towards multi-specialty, multi-facility practices. During this evolution, the organization struggled to adapt its archaic mainframe accounting system to UCH’s changing needs, and decided to find a more flexible, cloud-based ERP solution. The finance team wanted software that would provide better transparency into UCH’s multi-entity, multi-location financial data, require less manual data entry and IT resources, and support paperless workflows. In addition, the organization needed a best-in-class solution that could connect with its payroll and integrated care software. UCH evaluated financial management software alternatives, before settling on Sage Intacct – which UCH considered to be by far the most flexible and complete system. The organization improved revenue management by importing patient charges from its previous software into Sage Intacct, as well as using the system to automatically generate contract-based invoices for partner facilities. This eliminated a manual, Excel-based process of preparing, tracking, and aging contracted revenue, saving UCH’s accountants six days each month. Sage Intacct’s reporting capabilities also streamlined UCH’s multi-entity reporting and consolidations process, cutting three days out of the monthly close and increasing confidence in the data.

Sage Intacct works with all types of nonprofit organizations to help them achieve the outstanding benefits available with cloud financials.

Contact us today to learn more.