NFP accounting: Inspired by a cause

Careers are not just about the pay. If you want a job that feels meaningful and helps society or the environment, consider the world of not-for-profits.

Not-for-profits (NFPs) spend their time and money to provide services to community members (people and furry friends) or to help the planet. Charities, hospitals, public schools and grassroots advocacy groups are examples of 501(c)(3) or 501(c)(4) organizations, so called because of their IRS status — #teamNFP.

NFPs rely on donor funding and they get specific tax credits, so accurate and transparent reports are a must. Investors and stakeholders want to know how the money is spent, and increasingly investors want to know how organizations are moving into sustainable business practices.

Make the dollar stretch for the greater good

Spending money wisely requires strategy, scenario planning and being oh-so mindful. NFPs can and do:

• Act as good stewards of donor funding.
  • Stewardship includes being prepared for audits and scrutiny of how donations are used.
• Maximize a dollar.
  • How can the organization spend less on administrative costs, operations, supply chain, etc.?
• Safeguard assets.
  • No one wants to be the victim of cybercrime. Accountants can advise on software to protect data and policies regarding data retention and deletion.
• Maintain compliance. Follow the rules. Uphold the regs.
  • Donors, the U.S. government included, will insist you play fair.
  • If you become a tax professional, tax-exempt organizations will need your services; because NFPs receive donor funding, the IRS likes to keep close tabs.

Working as a CPA at an NFP will likely mean you are an active participant in a wide range of business operations. Yes, there will be Excel spreadsheets and reports to generate. Also, meetings, emails, phone calls, collaboration with colleagues and signing a birthday card from time to time.

Align personal interests with professional goals

Not-for-profit organizations are out there, doing good work in their communities and contributing to our economy.

Fun financial fact: NFP organizations contributed $1.4 trillion to the U.S. GDP in 2022. That’s more than the entire national GDP of Denmark, Iceland and Norway combined.

If you’d like to someday work for an organization that aligns with your personal interests, make a list of options and scope their websites. An organization’s tagline will likely express an aspect of its values, and the “About us” page will highlight its mission or vision statement.

Then, start networking. Maybe you (or your parents) know someone who works at an NFP. Introduce yourself and ask for a 15-minute phone call. People who are passionate about their work tend to enjoy talking about it, so get your questions ready and reach out.

It's not too soon to start networking. And it’s not too soon to cultivate interpersonal leadership skills, like empathy and communication.

Why? When a company provides services to the elderly, the environment or four-legged friends, they tend to expect staff to have empathy and communicate respectfully to their clients. You’ll need to be empathetic with your colleagues, too. Careful spending to meet strategic goals can mean discussing (debating) which initiatives should be prioritized or how resources should be allocated. You may have differing opinions. Practice active listening.

Clear communication will come in handy as you problem solve with colleagues and as you translate accounting acronyms and terminology to stakeholders and donors.

Numbers aren’t always as clear as we think they are, and Excel spreadsheets can make some people mentally check out. Data visualization (e.g., colorful graphs) and telling the story of the people and dollars behind the graphs will paint a bright picture. That information can be translated to social media posts, campaigns and fund-raising initiatives to drive even more support for your NFP.

If you’re not comfortable working in Excel, take a class, explore YouTube tutorials, or play around in the software on your own time. If you don’t have Microsoft access through school, Google Sheets is available to everyone, no software license required.

You’ve got career options. That’s just one of the free student resources available to you at This Way to CPA.