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Guide to Using QuickBooks for Nonprofits [Tips and Integrations]

Guide to Using QuickBooks for Nonprofits [Tips and Integrations]

Nonprofits often face unique financial management challenges, including tracking donations, managing grants, and ensuring compliance with tax regulations. QuickBooks is a powerful tool that can help streamline these processes, making it easier for nonprofits to manage their finances efficiently.

This guide will provide valuable tips for nonprofits working with QuickBooks and highlight key integrations that can enhance the use of QuickBooks for nonprofit organizations. By following these tips and leveraging the right integrations, your nonprofit can harness QuickBooks’s full potential to manage finances effectively and maintain donor trust.

Why Do Nonprofits Use QuickBooks?

QuickBooks is the most popular accounting software in the U.S. and offers several features tailored specifically for nonprofits. QuickBooks helps organizations to track donations, manage expenses, and generate essential financial reports. Here are some reasons why QuickBooks is an excellent choice for nonprofit organizations.

User-Friendly Interface

QuickBooks is known for its intuitive and user-friendly interface, making it accessible to those with limited accounting knowledge. This ease of use ensures that your nonprofit staff quickly adapts to the software without extensive training.

Comprehensive Financial Reporting

QuickBooks Provides Comprehensive Financial Reporting for Nonprofits

QuickBooks provides a range of financial reports that are crucial for nonprofits. These include profit and loss statements, balance sheets, and donor contribution summaries. These reports help your organization maintain transparency and accountability to supporters, essential for gaining and retaining donor trust.

Customizable Features

QuickBooks allows organizations to customize virtually everything – from their chart of accounts to favorite reports and invoices to suit their nonprofit’s specific needs. Organizations can also run employee payroll and mileage tracking through QuickBooks. This flexibility ensures you can track the financial metrics that matter most to your organization.

Integration with Other Tools

QuickBooks integrates seamlessly with various other tools and applications, enhancing its functionality. Integrations with fundraising platforms like DoJiggy and payment processors streamline your nonprofit’s operations and improve efficiency.

7 Essential Tips for Nonprofits Using QuickBooks

Set Up Your Chart of Accounts Properly

The Chart of Accounts (COA) is the backbone of your financial management system. Setting it up correctly from the start is crucial to ensure accurate tracking and reporting. While QuickBooks will provide a template, you’ll want to customize your chart of accounts to include categories specific to your nonprofit, such as donations, grants, and program expenses.

Utilize Class and Location Tracking

QuickBooks offers class and location tracking features that can be incredibly useful for nonprofits. These features allow you to track income and expenses by program, project, or funding source. This allows you to generate detailed reports and gain insights into the financial health of different areas of your organization.

Record Donations Accurately

Record Donations Accurately

Accurately recording donations is vital for maintaining donor trust and ensuring compliance with tax regulations. Use QuickBooks to record donations received. You can also generate donor contribution statements, which are essential for acknowledging donors and providing them with the necessary documentation for tax purposes.

Manage Grants Effectively

Grants often come with specific reporting requirements and restrictions on how the funds can be used. Use QuickBooks to track grant income and expenses separately from donations. This will help you ensure compliance with grant conditions and provide accurate reports to grantors.

Automate Recurring Transactions

Save time and reduce the risk of errors by automating recurring transactions in QuickBooks. Set up recurring templates for regular expenses, such as rent or utilities, to ensure they are recorded accurately and on time.

Reconcile Accounts Regularly wit QuickBooks

Reconcile Accounts Regularly

Regular account reconciliation is crucial for maintaining accurate financial records. Reconcile your bank and credit card accounts monthly to identify and resolve any discrepancies promptly.

Leverage QuickBooks Reports

QuickBooks offers a variety of reports that can provide valuable insights into your nonprofit’s financial health. Regularly review these reports with your Board of Directors to monitor your organization’s performance and make informed decisions. Key nonprofit reports include the Statement of Financial Position (Balance Sheet), Statement of Activities (Profit and Loss), and Cash Flow Statement.

Key QuickBooks Integrations

CRM and Donor Management Systems

Integrating QuickBooks with a donor management system streamlines your bookkeeping efforts. These integrations allow you to automatically sync donor information and donations, reducing manual data entry and ensuring accurate records.

DoJiggy’s Fundraising Platform

DoJiggy integrates with QuickBooks via Zapier

DoJiggy integrates with QuickBooks via Zapier to simplify the management of online fundraising campaigns. The integration enables organizations to automatically sync donations made in DoJiggy into their QuickBooks account and maintain accurate records of their fundraising activities.

Payment Processors

Integrate QuickBooks with payment processors like PayPal and Stripe to streamline invoice collection and recording. These integrations ensure that transactions are automatically recorded in QuickBooks, saving time and reducing errors.

Payroll Services

QuickBooks provides payroll services with automatic deposit and also integrates with various top payroll services, to streamline payroll processing. These integrations ensure that employee salaries, taxes, and benefits are accurately recorded and reported. W2s and tax forms are easily generated and distributed to employees.

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Conclusion on the Benefits of QuickBooks for Nonprofits

QuickBooks is a powerful accounting tool that can help nonprofit organizations manage their finances efficiently and effectively. By setting up your chart of accounts correctly, utilizing class and location tracking, recording donations accurately, managing grants, automating recurring transactions, reconciling accounts regularly, and leveraging QuickBooks reports, you can ensure accurate financial management for your nonprofit.

Integrating QuickBooks with the DoJiggy fundraising platform and other services you already use can further enhance your nonprofit’s financial operations. These integrations streamline processes, reduce manual data entry, and ensure accurate records, allowing you to focus more on your mission and less on administrative tasks.

Lisa Bennett

About Lisa Bennett

Lisa is the Sales Director at DoJiggy. She joined DoJiggy in 2006 and loves her job. Prior to working with DoJiggy, she worked at several non-profits and managed special event fundraising.

See other posts from Lisa Bennett