As finance executives such as controllers and CFOs navigate risk management, compliance and budgeting for not-for-profit organizations, they are faced with a dilemma: how to manage budget concerns with the demands of the finance role.
We know that many not-for-profit and affordable housing organizations maintain a small internal staff to ensure that their organization is a good steward of resources. However, this reality often forces finance executives into compliance and staff management rather than using their time for strategic planning and forecasting.
In our experience, finance executives will often encounter a changing regulatory or standards landscape or a shift in strategy that overwhelms the team’s capacity or knowledge. That is when a close relationship with the organization’s CPA, specifically for nonprofit accounting consulting, is essential.
What are Client Accounting and Advisory Services?
Client accounting and advisory services are a flexible way for finance professionals in not-for-profit or affordable housing organizations to augment their staff and knowledge. This nonprofit accounting consulting offers independent accounting oversight, knowledgeable support for the finance team or interim staffing for open staff positions.
When it comes to complex regulatory or compliance issues, an independent view of the organization’s accounting can expedite response and help finance leaders plan for changes. It can bridge the knowledge gap between finance and board members. It can provide reliable data for controllers and CFOs to make strategic decisions.
Client accounting and advisory services are used by organizations that have a separate audit relationship. The audit engagement must be performed by an independent firm, but the organization can work with a second CPA firm on their internal bookkeeping, financial reporting and budgeting. For example, LvHJ’s CAS+ services offer the following to our non-audit clients:
- Bookkeeping and Financial Reporting
- Receivables/Payables Management
- Budgeting
- Grant Accounting (Not-for-Profits)
- Audit Preparation
- Internal Controls Recommendations
- Implementing Accounting Systems and Training
- Implementing New Accounting Standards
The CAS+ team works side-by-side with the finance team to support streamlined processes, strong controls and quality data for decision making and forecasting.
Why Affordable Housing Uses Client Accounting and Advisory Services
Not-for-profit and for-profit affordable housing organizations are subject to specific accounting standards, reporting and audit requirements. Whether they are preparing financial statements and reports for various stakeholders or monitoring development draw packages for their next project, finance leaders and staff have a lot on their plates. Inaccurate or delayed accounting and invoicing have serious consequences for project success and organizational health.
In addition, affordable housing organizations must prepare for the annual audit by preparing audit schedules and analysis and coordinating with the audit team. It may be challenging for the staff to manage daily tasks while also responding to requests from their auditor and carefully reviewing the draft audited financial statements.
Setting up a flexible arrangement with a client accounting and advisory team will not only support accurate and timely accounting and reporting, but also ease the strain of the annual audit. With independent oversight of the accounting system, our CAS+ team also advises on procedural improvements and/or upgrades to the accounting system when necessary.
Why Not-for-Profits Use Client Accounting and Advisory Services
Not-for-profit organizations are also subject to audits and require close monitoring of accounting and reporting. They are unique in the source of their funding and how that funding is tracked and reported, particularly if the organization receives government grants or unrelated business income.
Failure to track and report sources of revenue properly can result in fees and penalties, while also threatening the status and ability for the organization to receive funds in the future.
This complexity is a great reason to engage with client accounting and advisory services. Our CAS+ team has the knowledge to develop internal controls, processes and procedures that ease the burden on staff and finance leaders. An independent view of finance throughout the year can also provide strategic recommendations for new sources of funding, budgetary adjustments and streamlined vendor or joint partner arrangements.
As a liaison to the not-for-profit board and other stakeholders, nonprofit accounting consulting presents information in simple terms and identifies the reasoning for certain decisions. Our team has also helped onboard new controllers, CFOs and staff by providing context for past accounting and budgeting decisions. We objectively serve your internal team and the organization’s best interests.
Is CAS+ Right for Your Organization?
If your organization is struggling with timely accounting or staffing shortages, these are two very good reasons to consider client accounting and advisory services. Nonprofit accounting consulting can match your budget and service needs and grow with your organization.
Another good reason to choose a client accounting and advisory arrangement is access to a knowledgeable team who can oversee and help prepare for the annual audit. For larger affordable housing organizations, this is no small task. CFOs and finance leaders benefit from recommendations and implementation in advance of the audit.
For more information, visit LvHJ’s CAS+ page.
