Try using your favourite search engine to find a budgeting app for your Not-for-Profit and you’ll soon discover that the results are full of personal budgeting tools. YNAB may be great for managing your household finances but it’s not going to help you run a charity. So, here’s our cheat sheet on the main contenders and what to look for.
Develop a Budgeting Apps for Not-for-Profits Needs Analysis
You cannot, or should not, start searching until you know what you are looking for.
What is the problem you are trying to solve?
Understand your Current Situation First
Start with asking some questions about your current situation:
- How much time does your annual budget take?
- Does it take a long time when you need to revise it?
- How often do you revise your budget?
- How many people are involved in the budget process?
- Identify your problem: Is it the tools you have or the people using them?
What Does Your Ideal Budgeting App Need to Do?
To work this out, think of the functions you go through to prepare your budgets. Then, think about the frustrations you would like to solve.
- Does it need to connect directly to your accounting system?
- Is an import/export connection good enough?
- How many people will use it? Are they all in the same location?
- Estimate how many programs/projects/departments you need now and, in the future.
- Consider future changes to your environment, culturally as well as technically.
- Keep in mind that budgeting is closely tied to reporting. As a result, your budgeting app and your reporting app may be best as one.
Discuss these questions with your team and prepare a list of must-have requirements. In addition, consider the ones you would like to have. Just like buying a car or a house, choosing software is often a compromise. The goal is to tick all the really important boxes and then as many of the others as possible, within your budget.
Evaluating Budgeting Apps for Not-for-Profits
As well as matching the app to your Needs Analysis, keep these questions in mind as you are evaluating each app:
- How much time will it save me?
- Will I produce better results than my current system?
- How will I get training and support when I need it?
- What is the reputation of the supplier? Will they still be around next year?
- Is the price reasonable for an organisation of our size?
The Budgeting Apps Shortlist: The Ones Full of Promise
There are many budgeting and reporting apps out in the world and we’ve focussed here mainly on those that integrate with mainstream accounting systems like Xero, MYOB and QuickBooks Online.
There are others that offer a totally independent solution. However, given the vital need to compare actuals to budgets, we have worked on the assumption that some sort of connection to the accounting system is mandatory. A direct connection is best, but an export/import process can be manageable.
Essentially, the common theme across this group is not that they are bad budgeting apps. They could be perfectly suited to a small business or accounting firm. They just don’t meet the needs of most not-for-profits when it comes to handling budgets.
In some ways, the name gives it away here. Spotlight is a reporting app, not a budgeting app. You can enter budgets at the organisation level but if you want program budgets, you need to use the ones in your accounting system. Spotlight brings in Tracking Category budgets from Xero for reporting purposes, but you need to manage them in Xero and that is limiting.
For those of you using MYOB Advanced, Exo or Sage, Forecast 5 could be an option but it’s very much focussed on organisation-level budgeting and reporting.
Cost centres or departments are managed as separate organisations and consolidated. This might work for a small number of programs. Although, this is likely to be tedious for those with more than half a dozen activities to track
LivePlan works with both Xero and QuickBooks Online but project and department budgets are missing. You may find it useful for strategic planning as that is its real strength.
The Budgeting Apps that Work – with Reservations
Our next group are used in the Not-for-Profit sector but not widely. They work, and have their fans, but they also have serious limitations.
Born in Adelaide and going back to the old days of MYOB, BudgetLink does now work with MYOB AccountRight and Xero. It essentially gives you an Excel template, pulling in your accounts and actuals from the accounting system.
It is a desktop application that uses Excel for all the output. Honestly, it has quite the vintage look of a 20-year-old app. On the other hand, it comes with a range of pre-set reports comparing budgets to actuals for MYOB jobs or Xero tracking categories and you can manage budgets for both of those.
There is a free version but once you want any changes, you need to start paying. That’s not a bad thing, just something to be aware of.
Another veteran of the early MYOB days, BI4Cloud links to MYOB, Xero, QBO, Attache and SAP Business One. It provides a simple grid for budget entry and outputs data to a spreadsheet. One of its strengths is detailed, transaction level reporting. If you want to know your top-selling products or to rank your donors. Ultimately, it may have something useful for you, with or without the budgeting.
Budgeting Apps for Not-for-Profits
Amongst the many technology options available, there are a couple of budgeting apps that have been designed with Not-for-Profits in mind. For the following reasons:
- Flexible budgeting that you can safely delegate to program managers;
- Link to your accounting system;
- NFP focused Simple things like an Unspent Budget report or something grouped the way you need it for a grant provider.
This is the solution for the big end of town mostly. It links directly to QuickBooks Online, Sage Intacct and Blackbaud’s Financial Edge. Its audience is charities, not-for-profits and churches. Primarily, it has a strong reputation in that sector mostly in North America.
You can do budgets at the program level and roll them up to the organisation level. Some reviewers have commented that Martus can be hard for non-accountants to understand. But, given that organisations using these accounting systems will likely have an in-house finance team, this should not be a major roadblock. They don’t display pricing publicly so we suspect it is like the Rolls Royce salesman said, “If you need to ask, you probably can’t afford it”.
Based in Townsville, North Queensland, Calxa was designed with the budgeting needs of non-profits in mind. The powerful budget builder has depth where program budgets roll up to the organisation budget. In addition, you can easily manage Approved Budgets, Forecasts and multiple budget versions. Also, creating driver-based budgets so you can build them from program participants or any other non-financial data helps deliver impact data. Let us not forget the flexible views. For example, you can view the traditional accounts by month or flip everything to see all programs for one account and re-allocate budgets as you need.
Finally, you can set user access by program to either edit or just report on budgets. And then, use lots of pre-built report templates, ready to add to a Report Bundle and deliver by email each month.
Calxa donate their app to small charities and Not-for-Profits. This is managed by Connecting Up in Australia, Tech Soup in New Zealand and Charity Digital in the UK.
PROs and CONs for Not-for-Profits
Here is a quick reference table to see the strength and weaknesses for each budgeting app.
|Spotlight Reporting||Reporting on tracking categories from Xero.||Budgets at organisation-level only.|
Program budgets are managed in your accounting system.
|Forecast 5||Connects to ERP systems like MYOB Advanced, Exo and Sage.|
Can possibly work for smaller number of programs.
|Focussed on organisation-level budgeting and reporting.|
Cost centres and departments are managed as separate organisations and then consolidated.
|LivePlan||Useful for Strategic planning.|
Connects to Xero and QBO.
|No program or department budgets.|
|BudgetLink||Connects to Xero and MYOB.|
Offers pre-set reports for budget comparison by jobs and tracking categories.
|Desktop application – no cloud offering.|
|BI4Cloud||Reputable veteran app provider.|
Detailed and transaction-level reporting on top-selling products of ranking your donors.
|Simplistic budget entry grid.|
Outputs data to spreadsheet.
|Martus||Designed for NFPs.|
Does program level budgets.
|More suitable for larger charities with systems like Sage, QBO, Blackbaud’s Financial Edge.|
No pricing displayed indicating possible steeper costing.
|Calxa||Strength in NFP reporting.|
Flexible budget builder.
|Handles complex reporting requiring some learning.|
Choosing Budgeting Apps for Not-for-Profits
As we have seen, you have choices when looking for budgeting apps for Not-for-Profit. Don’t be dazzled by the bright shiny things but keep your requirements in mind as you investigate and evaluate. Make an informed decision and you will find something that will give you easier, quicker budgets than you would with a spreadsheet. And with fewer opportunities to break things!
If you want to include cash flow forecasting into your board reports, have a look at our Top 5 Xero Cash Flow Alternatives for some ideas on where to start.