By following some key financial compliance tips, nonprofits can stay accountable, transparent, and better prepared for audits and reviews.
Nonprofit life is a balancing act of fundraising, outreach, and bringing positive change to your community. But behind the scenes, strong financial compliance is just as critical. Without it, your organization could risk losing trust, funding, or even its tax-exempt status. Fortunately, staying compliant is simpler than you might think. With a few smart practices and technology like Sage Intacct, you can keep your fiscal house in order and find more time to focus on your mission.
Read on to discover four essential financial compliance tips every nonprofit needs to know.
1. Stay true to trusted accounting standards.
Following Generally Accepted Accounting Principles (GAAP) isn’t just good practice, it’s essential for nonprofits and for-profits alike. GAAP provides the framework that keeps financial reporting honest, consistent, and transparent. It helps to:
- Build trust with donors and stakeholders
- Accurately track every dollar, grant, and donation
- Remain in good standing with regulators and auditors
How Sage Intacct helps: GAAP-compliant reports are built into Sage Intacct. That means less manual work for your team, greater accuracy, and more confidence in your numbers.
2. Stay sharp at tax time.
Just because your nonprofit is tax-exempt doesn’t mean you’re off the hook during tax season. You’re still required to file the right forms every year, and missing a deadline can come with steep consequences. Key filings include:
- IRS Form 990: Your annual federal return
- State-specific forms: Some states require additional nonprofit filings
- W-2s and 1099s: For employees and independent contractors
Late or incorrect filings can lead to fines or even threaten your tax-exempt status. Staying organized and filing on time keeps you in good standing and makes tax season much less stressful.
How Sage Intacct helps: Built-in tracking for Form 990s and payroll reporting keeps you organized and ahead of deadlines—no last-minute scrambling required.
3. Always be prepared for an audit.
Audits may sound intimidating, but they’re part of life as a nonprofit. They’re more likely if your organization:
- Receives more than $750,000 in federal funding
- Exceeds your state’s audit revenue threshold, or
- Has grantors who ask for audit reports
Even if it’s not required, conducting an independent audit can be a smart move. It keeps your finances sharp, builds credibility, and helps catch small issues before they become big problems.
How Sage Intacct helps: With its real-time dashboards, audit trails, and permission controls, you can quickly and easily provide exactly what auditors need. No more time-consuming searches in old spreadsheets or error-prone manual processes.
4. Get serious about risk management.
No one likes thinking about fraud, theft, or cyber threats, but they’re becoming more commonplace and nonprofits aren’t immune. Protect your organization by:
- Setting up strong internal controls: For example, get signoffs from two people signing for large payments.
- Limiting access: Be selective about who can see financial documents.
- Prioritizing data security: Encrypt your databases and update systems regularly.
Strong internal processes reduce risk and show your donors and board that you’re serious about stewardship.
How Sage Intacct helps: With robust, layered security and built-in approval workflows, Sage helps you safeguard sensitive financial data and operate with confidence.
Nearly 85% of nonprofits use technology for financial management—and with good reason. No longer a luxury, automation has become a must-have for transparency, speed, accuracy, and adherence to ever-changing laws and regulations. Sage Intacct stands out as the leading cloud accounting solution because it was built with nonprofits like yours in mind. It’s got everything you need to stay on top of your financial compliance program and free up time to focus on your mission.
By following these smart financial compliance tips, building strong internal processes, and leveraging the right tools, your nonprofit can stay audit-ready, build trust with stakeholders, and set the stage for lasting growth.
IBC has completed hundreds of successful software implementations across nonprofits of all types and sizes. Our team of experts will help you implement this powerful tool—quickly and affordably—so you can feel confident in your financial compliance efforts. Contact us to get started!
About IBC: At IBC, we have a deep understanding of the critical business needs and processes specific to associations, non-profits, and unions. We ‘get’ your culture, your goals, and what drives you, too. Focused exclusively on and dedicated to delivering the most effective AMS, LMS, and Cloud Financial Software for our clients, we’re well-versed in identifying and applying the integration techniques that will save you time and money. Since 2001, our cutting-edge products, unparalleled responsiveness, and award-winning services have helped organizations like yours increase their operational and financial performance by leveraging best practices and proven solutions. For more information about IBC, please visit the website at www.ibconcepts.com or call 443.603.0215.
