Breaking the Communication Barrier: Getting Your Finance and Development Teams to Talk

PRESENTED BY DZAUYA NKUCHWAYO, JONATHAN

HOWELL, MICHAEL CULLER

• Describe the needs of the Development and Finance departments

• Better share common language between departments

• Avoid common reconciliation problems

• Understand best practices for integration

After this session, you’ll be able to:

Development

• Acknowledging and receipting donors quickly and accurately

• Accurate reporting on gift source and gift designation

• Answering donors’ questions

• Securing the next gift!

• Acquiring new donors

Finance

• Recording cash, revenue, and receivables quickly and accurately

• Ensuring that designated revenues are tracked and expensed/released correctly

• Reconciling data entry, reports, and bank accounts

• Presenting accurate and usable financial statements

• Maintaining control of cash

What does each office care about?

Poll

By a show of hands

How often does your development department meet with the finance department to reconcile donations?

A. Weekly?

B. Monthly?

C. Quarterly?

D. Once a year?

E. Aside from someone’s birthday celebration, we never see the two in the same

office together?

How do many of you (finance and development) work together to establish the annual budget?

So how do we improve?

• Build financial literacy across the organization

• Align planning cycles across teams

• Create regular communication and cross training routines

• What ideas do you have?

Speaking the same language

• Integration: How we tell Finance about the gifts Development has received

• Gift: Cash, pledge, stock/property, in-kind, or planned

• Pledge: A legally enforceable promise to give

• Stock/Property: Must be sold to obtain value for your organization

• Gift-in-kind: Valuable to your organization as-is

• Restriction/Designation: A donor’s direction on how or when a gift must be spent

• Journal Entries: Debits and credits entered in the General Ledger to account for gifts

Shared definitions

How should the database integration look?

Too many orgs attempt this: When it should be this:

CRM Accounting CRM Accounting

• What information MUST be shared between development and

accounting?

• What information MAY be shared between development and accounting?

• What latitude do you allow your donors when they designate gifts?

• How many credit card channels do you use?

• When do you find out about direct deposits/credit cards? Who handles

the money first?

• How many bank accounts do you use?

• How does the bank present information in its statement to you?

Integration considerations

• Who is your audience?

• Which system/office holds the data?

• How often will you generate the reports?

• Which numbers are you trying to match between offices?

Reporting considerations

• Only the reporting from Finance is “trustworthy”

• We attempt to report development info out of our accounting system

• Reports don’t match

• Donor designations are more specific in one database than the other

• Pledges are either not recorded, or are constantly written off

• Timing of cash entries makes bank reconciliation difficult

• Records are adjusted constantly

• People don’t talk to each other

Common challenges

• Let each system do its job

• Determine how much latitude to grant donors when designating gifts

• Record pledges as receivables when they’re made

• Don’t call something a pledge unless it’s truly a pledge

• Post to one or two bank accounts…

• …or post to a single clearing account

• Post daily

• Reconcile weekly

• Don’t enter a gift until you know everything you need to know

• Adjustments should be the exception, not the rule

• Talk to each other!!!

Best practices

12 #bbcon

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Are you pumped up and ready to go?