Tuesday, 3 November 2009

What Accountants Know

What do accountants bring to the table for charitable donations? I would like to make the case for a special kind of support, something that will help EVERY charity and something that comes naturally with accounting training and experience.

The difficult fact that each charity faces is that nobody wants to support administrative costs. Governments don't fund this area, nor do foundations or private individuals as a rule. Yet every charity spends a significant amount of time and money on administration: paying the rent, keying in the payroll, buying insurance, etc.

As accountants, we are arguably experts on administration. We track it. We analyze it. We minimize it. We research it. And we appreciate it when it's done well.

So many not-for-profit organizations I've worked with actually underspend on administration. They use obsolete computers and inadequate software, forcing them to spend too much staff and volunteer time on admin. Often staff are not sufficiently trained in standard packages like word processors and spreadsheets, so too much time gets spent on the otherwise normal processing of transactions and reports. Others are lucky enough to have an endowment cover at least part of the administrative costs, but they are a small minority.

Sometimes this skimping on administration leads to self-defeating results. It takes resources to write grant proposals, report to donors, mount events or create fundraising campaigns. As any salesperson will tell you, you have to spend money to make money.

Administration is not exciting. Most people would rather see their money go towards a scholarship, a key piece of equipment or research into curing a disease, but with our specialized training and experience, accountants are different. We know how important effective administration is, how the very success of the charity may depend on it.

So, please consider marking your next donation to your favorite charity, "For ongoing administration". Your donation will get the attention it deserves!


cpareview said...

You are actually right. This gave me something to think about.

I will surely find a good charitable institution I can support.

Verna said...
This comment has been removed by the author.
Verna said...

I'll definitely consider that and bear it in mind. Then again, I noticed how accounting for nonprofit organizations are tremendously important but, most of the time, neglected due to its cost saving measures. We have to realize that without the full support that they need, the organization will greatly suffer. I think that it would be wiser to invest on equipments that will help the staff be productive and efficient. We must not forget how important administrative works are especially its vital functions such as accounting. Nonprofit groups are truly a blessing for many, mainly because of the mission they provide.

accountant said...

Awesome Post!
I was pleasantly surprised by this post and learned quite a lesson that no "blogger" or "social media" experts have been able to present to me.
Thanks for information as an accountant i know how informations are helpful thanks again
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