How it runs for nonprofits, charities and associations
Restricted gifts are tagged at application so the restriction is never lost. Unapplied cash is cleared before every close and the weekly report shows what was received by fund.
What is cash application?
Cash application means matching money received from customers to the invoices it pays and recording that in the accounting system. It covers bank receipts, checks, lockbox files, card payouts and remittance advices, including partial payments, deductions and payments with no reference. Done well, the aging is accurate and no customer is chased for an invoice they already paid.
What we handle for nonprofits, charities and associations
- Apply government ACH and check receipts to the claims they settle
- Match member, sponsor and program fee payments to invoices
- Apply pledge payments to the donor's pledge receivable
- Tag restricted gifts to their fund at the moment of application
- Clear unapplied cash to zero before each month-end close
The KPI that matters here
95% of receipts applied within 1 business day with every restricted gift tagged to its fund at application.
Nonprofits compliance notes
IRS Form 990 data (US)
Tax-exempt organizations file Form 990, 990-EZ or 990-N depending on gross receipts and assets, by the 15th day of the fifth month after year-end. We prepare the underlying data: revenue by source, functional expenses by program, management and fundraising, net assets by restriction, and officer compensation schedules. Your CPA reviews and files the return; we provide preparation support only.
Restricted versus unrestricted funds
Under ASU 2016-14, net assets are presented with donor restrictions and without donor restrictions, and restrictions are released when the purpose or time condition is met. We track each restricted gift and grant from receipt to release in the ledger, so the statement of activities and the notes show releases with support rather than estimates.
Charity Commission (England and Wales)
Registered charities with income over £25,000 must file an annual return and accounts within 10 months of the financial year-end, and those above the audit threshold need an independent examination or audit. We keep the books to Charities SORP categories where the charity reports on an accruals basis, and assemble the figures for the trustees' annual report. The trustees and their examiner or auditor remain responsible for the filing.
ACNC (Australia)
Charities registered with the Australian Charities and Not-for-profits Commission lodge an Annual Information Statement within six months of year-end, with financial reporting obligations that rise with size. We prepare the financial figures and, where the charity is registered for GST, the BAS workpapers for your TPB-registered BAS agent or accountant. We do not lodge the statement or the BAS.
Nonprofits software we work in
- QuickBooks Online
- Xero
- Sage Intacct
- Bill.com
- Stripe
- PayPal
- Gusto
- Bloomerang
- DonorPerfect
- Neon CRM
- All 50 platforms
More for nonprofits, charities and associations
Other services for nonprofits
Frequently asked questions
How do you know a gift is restricted when you apply it?
From the donor's letter, the campaign or appeal it responded to, the CRM record or the grant agreement. We check each larger gift against those sources before applying it, and tag it to the restricted fund at the same time. Where intent is unclear, the gift is held in a clearing account and your development team is asked the same day.
What if a government payment does not match our claim?
Agencies often pay net of disallowed items or adjust for prior overpayments. We apply the payment to the claim, record the difference as a disallowance or adjustment with the agency's remittance detail attached and flag it to your grant manager. Disallowed costs are moved off the grant to the general fund so the grant ledger stays accurate.
Do you apply payments that come through our donor CRM?
Yes, gifts recorded in Bloomerang, DonorPerfect, Neon or a similar CRM are matched to the platform payout and bank deposit, so the CRM, the ledger and the bank agree. The CRM remains the donor record; the ledger carries the accounting. See the Stripe reconciliation page for nonprofits for the payout matching workflow.
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