Best Practices Around Budget Automation

Businesswoman working on her laptop and calculator

We’re at the half-year review mark of the budget lifecycle. Have you observed anything over the last six months that should be automated? Do you believe budget best practices are being incorporated, or have you identified ways to improve the budget process?

Let’s Start with Real-time Access and Automated Activities

When using or deploying nonprofit fund accounting software, look for setup wizards, alerts, and other automated processes that eliminate errors and save your staff time and effort. Even with the best intentions, manual routines are subject to human errors that can ripple into our monthly and quarterly budget reports. To prevent potential mistakes, check to see if your team’s repeatable tasks are automated to ensure consistency and accuracy.

Efficiently Monitor Your Budget and Team Roles

Whether it’s a new building you’re forecasting into next year’s budget or an unexpected crisis for which you haven’t budgeted, good stewardship of your organization’s funds requires close cooperation among the stakeholders. Clear ownership and excellent communication are crucial to monitoring the budget. As a checkup point, ask yourself, does your accounting software enable your team to set roles related to past, current, or future budgets and forecasts? Ideally, the answer is yes — your team should be able to easily view assigned tasks and updates based on an individual’s name role.

Preserve Budget Integrity During Staff Transitions

We’re all too familiar with the turnover rates in the nonprofit space. But as sad as it is to lose a team member, the reality is that it’s inevitable. The good news is that we usually get a new player to join the team. If this is the case, and you’ve been taking advantage of automation best practices, such as automating the finance team’s work, then the organization can be confident its budget knowledge is still secure and accessible anytime. Automation also eliminates the concern that a person who left the organization may have taken some of your spreadsheets with them. Instead, your new team member can hop into the budget tasks and ramp up efficiently.

Complete Tasks, Optimize and Refer to Archives As Needed

How many times have you had a list of tasks with priorities that you can’t seem to complete? The benefit of having an accounting software with scheduled and automated tasks is that it will do some of the work for you, giving you more time to work on other priorities. Make sure your software’s features can delegate tasks to others, set notifications or alerts if budgets are changed by co-workers, and automatically complete tasks you’ve approved. Lastly, as another checkup point, your nonprofit accounting software should allow you to seamlessly compare budgets from previous months, quarters, and years. No longer should you need to manually compare file after file of spreadsheets.

Improve Your Budget Practices Throughout the Year

The National Council of Nonprofits puts it best: “Budgets should not be ‘written in stone’ because the financial position of the nonprofit may change during the year.” Continuously monitoring your budget and comparing it to actual results is a vital practice for robust and responsible management of your nonprofit, but that process works best when it’s tied to regular reviews and reports for executive leadership, board members, and key staff.

Ongoing professional development can help your team improve its budget practices throughout the year, including reading industry trends and practices and joining experts with tips on budget management. Check out our customer webinar Budget Checkups and Lifecycle Management for solutions to budgeting that enable you to get back to focusing on your cause.

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