Choosing Accounting Software: Questions to ask

Summary:

An early entry in the FAQ that still provides some useful advice.

Answer:

Todd Marsh wrote about Fund accounting packages in soc.org.nonprofit on
20 Jul 1995:

C Hanback had asked earlier:
"My financial director is interested in upgrading our accounting
software and utilizing one that includes fund accounting."

Before you start looking at fund accounting software, make a list of the
features that you are looking for. Most of the programs on the market
can produce basic fund financial statements, but each of them has
strengths and weaknesses. Some questions to ask yourself are:

• What equipment & operating system do you have? Do you want to buy new
  equipment to run the system?
  
• Do you need fund raising software, fund accounting software, or both.
  If both, do they need to be connected?
  
• How many funds do you have? How independent are they? How many
  accounting transactions do you have each month?
  
• What is your budget for this project?
  
• Do you have specific reporting requirements from your grantors?
  
• Can you support the software internally, or are you going to need
  long-term help from the consultant who installs it?
  

Also, read a good review of FASB 116 & 117. These new rules drasticly
change the requirements for your financial statements. If you don't know
what you need, the software salesman won't make any sense to you. (See http://www.nonprofits.org/npofaq/03/29.html --Ed.)
If you haven't guessed, I am a consultant who specializes in accounting
systems. I have installed the "OmniFund" fund accounting system for 2
non-profits this year. It is an addition to Great Plains' Dynamics
accounting system for Windows. Both clients like the system for its ease
of use and flexible reporting. If you have questions, please write to
me.

Todd Marsh
MIS Consultant
Universal Computer Technologies
Dallas, TX

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Posted in 1995 -- Ed.