How does an organization move from simple accounting to more sophisticated financial management described above?
This is one of the most challenging steps for the growing nonprofit. Hiring an experienced skilled nonprofit accountant to develop and transition to such a system is often beyond the financial means of an organization. The first step would be to recruit one or two persons having such knowledge as volunteers to the board of directors. They along with the CEO should plan the development of the financial management system as one would plan for a new program. One source of assistance might be another strong nonprofit in the community. That is especially true if you can find another nonprofit having a similar mission and array of programs. Consult with a medium to large accounting firm that has nonprofit accounting/audit as part of its practice. There are also many publications and books available. (See Resources, Section 10) The key is to approach this strategically rather than quickly hire a person who you hope will do the job.
