Share this content

How to Work Better With Nonprofit Clients

Sep 28th 2016
Share this content

Most of my friends thought I was crazy to go from a role as a CPA and manager at Arthur Andersen, to opening my own practice that offers services to nonprofits – by definition not the most lucrative of industries.

The nonprofit space is one I’ve felt passionate about since acting as the treasurer of a large Sacramento church, and one I see a lot of potential in supporting from a financial services perspective. More than that, the nonprofit sector has a unique set of challenges – mostly connected to their lack of financial resources – making it not only a tough market to serve, but also representative of the types of challenges facing SMBs across industries.

Now, 15 years into working with these nonprofits, I’ve developed an expertise in the nuances of small business finances and learned a few tricks to deliver high-quality services to a business with a bare-bones budget – all while building a successful firm of my own.

Unpacking the Challenges

The first step to delivering high-quality service in a cost-efficient way is to understand what makes nonprofit financial services so unique. Not surprisingly, the biggest challenge these businesses face is that they are financially strapped in terms of resources.

Like for-profit businesses, larger entities (such as big churches) can afford a full accounting department, while smaller organizations need to outsource support. They also face challenges common to SMBs, such as compliance and staffing.

Both typically require a mountain of paperwork and a great deal of due diligence, all of which can easily get lost in the hustle of running an organization. Compliance specifically is very important to our clients, as there are strict regulations that need to be followed in order to stay afloat.

And, on top of these resource and business challenges, nonprofits also deal with issues like exempt taxes, a complicated process that frequently requires outside counsel. Every CPA knows that each business has its own unique set of financial needs. But how can you effectively and efficiently solve these kinds of challenges to better serve your customers?

Outsourcing Efficient Solutions

It would seem too easy to say technology is the primary driver for how we’ve simplified the many processes required to solve these compliance and legal challenges – but it is.

Cloud-based systems have played a core role in enabling us to focus on helping our customers in the most efficient way possible. But what we’ve learned is that not all of those cloud-based systems need to be proprietary.

Another key to success has been outsourcing aspects of our business to not only streamline our own processes, but to also solve challenges for the clientele we serve. Some solutions we have adopted include Intacct for accounting and financial management and for expense management.

One tool in particular that has really helped address both our needs and customer needs is an HR management platform (we use Zenefits). This combines an HR information system, benefits and payroll into one solution and has workflows for streamlining employee onboarding and termination.

Previously, all of these were not only a painstaking manual process, but also required constant vigilance from our clients in updating things like direct deposit and change of address forms. By not having to think about the accounting-related pain points of these areas, my team can focus their time on other aspects of our service – providing a more holistic solution to nonprofits than we would have been able to before. Plus, outsourcing HR has removed the worry of compliance in areas like hiring, benefits and termination – i.e. COBRA administration – which means greater peace of mind for our nonprofit customers, and SMBs in general.

Focus on What You Do Best

Every industry has unique challenges, but by leveraging technology and outsourcing aspects of your business, you can alleviate issues for both your firm and your clients. These simple changes enable you to focus on providing superior customer service, and not on the distractions that come with archaic systems and processes.

In the case of my firm, adopting these practices has helped me build a lucrative business despite working in a financially strapped industry. So what do I say to my friends that think I’m crazy for working with nonprofits? I tell them they’re right – now send your clients my way!

Replies (1)

Please login or register to join the discussion.

Will Keller
By Will Keller
Oct 10th 2016 15:38 EDT

Hi Steve- Great article! I especially enjoyed your "my friends all thought I was crazy to start working for non-profits" angle. I saw a talk you did for Xero a while back where you shared your pricing strategy, that was really helpful. Quick question (if you feel like answering): Are you Xero, QBO, or Intacct-focused? Thanks.

Thanks (0)