All businesses and organisations need to maintain accurate and detailed financial records to ensure they observe their tax liabilities correctly, provide relevant information for audit trails, and have the information to make informed strategic decisions.
For charities and non-profit organisations, proper bookkeeping is also necessary to ensure full accountability, especially as their income is often sourced through public and corporate donations.
With many charities staffed by volunteers or inexperienced, part-time members of staff, it is important that accounts record keeping is maintained to a high standard and according to the legal complexities, without diverting from the core mission of the organisation.
Outsourcing bookkeeping for non-profit organisations can offer considerable benefits that will help your charity maintain its focus without draining its limited financial resources on in-house expertise:
Less Mistakes, Greater Financial Security
Relying on public donations and fundraising events and campaigns, the income for charities can often be inconsistent, with no defined or regular stream of money. This increases the potential for mistakes, as irregularities are difficult to spot, especially if the organisation’s bookkeeping is managed by a single employee or volunteer. Even accidental errors in maintaining a charity’s accounts can be costly. By outsourcing bookkeeping to a third-party expert who has no vested interest in the organisation, you can be confident that your books will be accurately maintained, with any risk of errors eliminated.
A Greater Focus On Your Core Mission
All charities and non-profit organisations are driven by a desire to make a difference. The wage bill of businesses commonly accounts for a significant proportion of their budget so, with limited resources, it’s vital that every employee and volunteer plays a part in supporting the core mission of the charity. Outsourcing the accounts can eliminate the need for a specialised bookkeeper, meaning you can invest the money in colleagues who can make an incisive contribution to promoting the charity’s mission - for example, by fundraising or creating promotional material.
Accurate Taxation And Reporting
Charities can take advantage of several tax reliefs that will help to maximise their income for good causes. They can also claim tax back on donations made by taxpayers (Gift Aid) and on certain deductions, such as bank interest. The complexities, therefore, are best managed by an independent, experienced accountant who has an excellent knowledge of HMRC rules and regulations. This ensures that your organisation pays its liabilities correctly, and also that tax reliefs are claimed where available.
Outsourcing bookkeeping for charities is a logical and rewarding step that will help to sharpen your organisation’s focus, reduce costs, and ensure that its accounts are kept in excellent health. For more information of our outsourced bookkeeping services, get in touch to discuss your charity’s needs and goals.