Non-profit organizations have a variety of needs when it comes to financial services. They need banking services to manage cash and operate effectively; they need accounting services to keep track of their assets; and they need advisory services to help them with risk management, estate planning, and other issues that are unique to non-profits. Financial institutions understand that there are many different types of non-profit organizations, each with its own specific needs, limitations, and objectives. As such, no single bank or credit union is going to provide all the services that meet their needs as an organization. If your non-profit organization is looking for financial services providers that can help you manage your finances, reduce your tax burden, ensure your IT security and data storage is in place, or offer you other specialized financial services tailored specifically towards non-profits. Let’s take a look at some common financial services used by non-profits.
Cash Management Services
Cash management services are aimed at helping non-profits manage their cash flow and budget effectively. With these services, you can choose to receive your payment for services rendered on a monthly, bi-monthly, or quarterly basis. You may also choose to receive a payment with 30-day terms of payment. This means that if you work as an independent contractor, you will receive a payment within 30 days of finishing the job. With these services, banks also offer interest earned on the funds that you keep in your non-profit’s account. And in some cases, you may also be eligible for overdraft protection. Banks with cash management services for non-profits often have specialized staff who work with non-profit organizations. As such, they are better equipped to understand the specific needs of these organizations. They may also have a dedicated non-profit department or even a separate branch that exclusively deals with non-profits.
Accounting Services
Accounting services are aimed at helping non-profits manage their day-to-day financial activities, as well as the creation of financial statements. In addition to helping you with taxes, accounting services can also help you forecast your future cash flow and manage your budget. Accounting services may also include the creation of financial statements, such as balance sheets, income statements, and cash flow statements. With accounting services, you may also be able to integrate your accounting software with other business management software you use. This can help you streamline your business management, improve your efficiency, and increase productivity. Accounting services for non-profits may be offered as a stand-alone service, or as part of a broader financial services package.
Tax Management Services
Tax management services are aimed at helping non-profits minimize the tax burden they incur due to their status as non-profit organizations. With these services, your accountants will help you minimize your taxable income and reduce your overall tax liability. Activities may include helping you choose which non-profit status to apply for and providing assistance with tax-related issues that may arise from time to time. Additionally, accountants may be able to help you claim any tax credits that you may qualify for as a non-profit organization. When selecting a tax management services provider, ensure that they are well versed in the specific tax laws that govern non-profit organizations. This will help ensure that they can maximize your non-profit status and minimize your tax burden.
Risk-Management and Estate Planning Services
Risk management and estate planning services are aimed at helping non-profits manage any risk they may face, as well as helping them prepare for the eventuality of leadership change. These services may include advice on how to protect your non-profit from cyberattacks and other types of data breaches. They may also include guidance on how to protect your organization from employee fraud. Additionally, risk management services may help non-profits protect themselves from reputational risk, as well as regulatory and legal risk. Estate planning services may include help with wills, trusts, and other legal instruments that can help your non-profit after the death of its leaders.
Information Security and Storage Services
Information security and storage services are aimed at helping non-profits protect their sensitive information, as well as the data they store in their computer systems. These services may include helping you set up an information security program, as well as a cyber insurance policy. They may also include data backup and data recovery services, as well as cyber threat monitoring and prevention services. With these services, your financial institution will help you monitor your network for signs of cyberattacks and other threats, as well as help you respond quickly when such threats are detected. These services may also include helping you manage sensitive customer data, as well as complying with privacy laws such as the GDPR.
Conclusion
Financial services are an important aspect of running a successful nonprofit organization. While many banks focus on commercial clients, some providers specialize in offering products and services to nonprofits. With the right financial partners, nonprofit organizations can manage their finances effectively, keep their tax burden to a minimum, take steps to protect against risk, and be prepared for the future after the death or retirement of their current leaders.
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