Charities which don’t embrace the latest technology in their finance teams could miss out on the best talent – and might even have difficulty finding an auditor.
That was among the messages at an event which considered how the future of the finance department could look.
Anjali Kothari, Partner and Head of Education and Not For Profit at Moore Kingston Smith, joined iplicit’s Paul Sparkes for the event at the CFG Annual Conference.
The session looked at the scope for software to handle many of the most time-consuming finance tasks, allowing people to focus more on the core purpose of the charity.
Most of us spend a lot of time with their thumbs poised over a phone, ready to do everyday tasks the quick and easy way. But the same isn’t always true in working life.
“As a consumer, I want my digital life to be really easy. I don’t want the mishaps, I just want to get on with life,” Anjali Kothari told the event.
As an employer, she also needed to look for those simple digital methods, she said.
“Also, I’ve got a huge number of youngsters coming through being trained as accountants in the ACA and they are streets ahead of us on so much that we as employers are trying to keep up,” she said.
“If we don’t keep up, those youngsters aren’t going to come to our firms – and I think if you don’t keep up, you’re going to find it quite hard to attract those young people into your organisations,” she told charities.
“I’m also an auditor and I can tell you now that unless we can bring the sector – and those commercial clients that we’re auditing – into this world more quickly, we are going to find it quite hard to audit you. And if we can’t audit you, then we are going to have to start walking away.”
iplicit’s Paul Sparkes set out some of the challenges that are common among the finance teams of nonprofits.
These include:
Paul Sparkes said Covid had been a “massive wakeup call” for organisations everywhere about the need to modernise their technology.
He said: “One day you’re in the office and everything’s fine. Why does it matter if my system’s accessible remotely?
“The next day, you can’t go to the office and you can’t access your finance system in the way you could – and you need it more than ever because you’ve got to do a whole set of new planning, forecasting and working out of what you’re going to do.
“I think that really changed the landscape.”
Anjali said many organisations had been hesitant about adopting cloud technology before the pandemic, worrying about where their data was held and who was responsible for it. “All those fears suddenly just went away and everyone was pretty much on board,” she said.
But since Covid, a gap had opened up, she said. Regardless of size or budget, some organisations “have really embraced it” and some had not.
Her own trainees were struck by the fact that some clients could do key tasks in a couple of clicks, whereas others were “still faffing about, five or 10 clicks later” and cross-referencing electronic records with paperwork.
“The youngsters that you’re going to have to embrace into your next set of employees are thinking very differently,” she added.
The session sought to visualise the finance department of the future.
As an example of what is already possible, the CFG Annual Conference audience was shown a video case study with iplicit customer Lewis-Manning Hospice Care, demonstrating how it freed up large amounts of staff time and provided better finance data.
Paul Sparkes said: “The finance team of the future will focus on things that are going to help the nonprofit organisation move forward in a different way – on better use of funds, or other things that often aren’t concentrated on because too much time is spent processing.”
How does any organisation start to make progress towards that brighter future?
Anjali told how digital transformation teams at Moore Kingston Smith begin their reviews of charity finance systems.
Instead of designing a system built around the finance team as its central point, the teams ask charities to reflect on their core purpose. Anjali said they ask: “What is it that you do as a charity and what is the key output?”
She added: “Surely your systems should be designed to enable you to do the key output.”
Paul shared his key piece of advice for those considering changing finance systems: “Look at lots of pieces of software.”
He added: “I would say start with a longlist, do some good research. You’ll find out very quickly what you like and what you don’t like.”
He urged finance teams to enlist the wider organisation when considering the change.
“If you want buy-in and you want people to help make the finance function be more forward-thinking, any process needs to start by including their input and understanding what they’re looking for,” he said.
“The best digital transformation projects I’ve seen definitely make sure that any team that comes together has representatives from across the entire organisation.
“When you make a decision about what system you’re going to choose – be it fundraising, finance, whatever it is – you need everybody to be bought into it and if you haven’t included them at the start of the process, that makes it a lot harder.
“If people feel they were part of that decision and that research process, it really changes the buy-in and engagement you receive.”
Download iplicit’s guide Changing Your Finance System: A Toolkit for Nonprofits, produced in partnership with Mark Salway.