Most nonprofits that go looking for a new finance partner aren’t starting from zero. They have an in-house team or an outsourced provider, and something isn’t working. Sometimes leadership can name the problem. More often, there’s simply a sense that the numbers aren’t telling the full story. For lean teams accountable to boards, funders, and auditors, getting accounting for nonprofit organizations right is about far more than closing the books.
The conversation below is drawn from a recent discussion with Robert Seestadt, Vice President of NFP Accounting at ContinuServe, and Holly Pisano, CPA, Managing Director in ContinuServe’s Nonprofit practice, who serves several clients as their CFO. The exchange, which has been lightly edited for clarity and length, covers where nonprofit finance functions tend to break down and what a true finance partner brings beyond the month-end close.
Why nonprofits look for a new finance partner
Q: When a nonprofit comes to ContinuServe, what is it usually trying to fix?
A: Most organizations come to us because they’re unhappy with their current situation, whether that’s another outsourced accounting provider or an internal team. Sometimes they can’t even pinpoint what’s wrong. There’s just a sense that something is a little off. Our job is to come in and start to unravel what’s going on.
Q: Where do those problems usually show up first?
A: Very often in revenue recognition. Nonprofit accounting has its own rules and regulations, and they’re nuanced. Revenue recognition works differently than it does for for-profit entities, and it’s always a critical audit area. If something is going to be a problem from an accounting standpoint, that’s typically where it is. So it’s usually the first place we jump in, making sure revenue is solid from the beginning.
Depth that comes from living in the nonprofit space
Q: Beyond solid reporting and controls, where does the team add the most value?
A: In the depth of experience behind every engagement. Our team chose this space because we’re passionate about mission-driven organizations, and that passion comes with a tremendous knowledge base. The team works in nonprofit finance every day, and some members have been in the sector for more than 20 years.
Put that continual daily practice together with that level of experience, and whatever a nonprofit brings to us, someone on the team has more than likely seen it. Clients get the value of the people working directly on their engagement plus everyone else across the practice who serves as a resource.
Q: How does that knowledge get shared across the team?
A: Through regular peer-to-peer discussions. Team members bring unique situations to the group, whether it’s a technical accounting question or something they’ve seen at a client, and share it with everyone. It’s how we keep building depth on the team, and it means every client benefits from what the whole group has learned.
Technology that takes the friction out of finance
Q: Many nonprofits are still running on older systems. How do you approach that?
A: Bringing tech-enabled solutions to our clients is a big part of what we do. One recent client came to us on a very old accounting system and was still cutting paper checks. The first step was moving them to a system that’s easier for everyone to use and integrates smoothly with tools like Bill.com or Ramp.
We also have colleagues across the firm who focus on using AI to make our work more efficient, including bots that connect systems that typically wouldn’t talk to each other. That work is already underway for clients today.
Q: Nonprofits come with all kinds of accounting platforms. Which ones does the team work in?
A: We’ll work in whatever system a client already uses. For a relatively simple nonprofit, QuickBooks Online is usually our first recommendation. Larger, more complex organizations often need something more sophisticated, so we have a NetSuite partnership and team members who support those implementations. Sage Intacct is another platform the team works in regularly. When a move to something easier, more efficient, and more effective makes sense, we help with that process.
Q: When does NetSuite make sense for a nonprofit?
A: When the organization has some complexity that calls for more. QuickBooks Online is very robust, but NetSuite is more customizable, with far more capability for customized reporting for leadership or the board. It also has built-in grants management through its nonprofit offering. Grants are typically a very manual process in this space, so for organizations managing many foundation, federal, or state grants, that makes a real difference.
A modern system also changes things for the client’s own staff. With access to pull their own reports, leaders can check budget-to-actuals at any point in the month or review general ledger detail on their own. And when accounts payable runs through a tool like Bill.com that syncs directly with the accounting system, expenses show up in real time, as they happen.
What a full-service engagement looks like
Q: What does a typical week look like when ContinuServe runs a nonprofit’s full accounting function?
A: “Typical” is a little challenging in our space, because every engagement is tailored. But for a client that relies on us as its full accounting department, from fractional CFO down to transactional work, there are usually weekly or biweekly check-ins with leadership: the CEO or executive director, or a COO or lead operations person.
At the CFO and controller level, we’re offering strategic guidance and acting as a thought partner. In the background, team members record and process transactions, from donations coming in to payments going out. The same team handles bank and balance sheet reconciliations and keeps the monthly close neatly tied up.
The ideal is that when audit comes around, it isn’t a heavy lift, because everything is already in great shape. That consistency is the foundation for reliable nonprofit financial reporting.
Navigating funding shifts with clear-eyed scenarios
Q: The funding landscape has been difficult for nonprofits. How is the team helping clients through it?
A: It’s been challenging over the past couple of years. The federal grant landscape has changed, and funding in some areas has been eliminated entirely. That has a trickle-down effect. State funding agencies may step in, but they only have a finite amount of funds. Then private foundations feel the pressure to help, and their funding is finite too.
We don’t have a magic way to replace lost funding, though with private foundations we may be able to make some connections. Where we really add value is decision support.
Q: What does that look like in practice?
A: Last year, one client lost $2 million in state funding and didn’t have much in reserves to cover the gap. They had to eliminate about 15 positions quickly. We built scenarios and a decision tree for leadership. If they waited, what would happen to their long-term reserves and their ability to continue the work? If they acted, how many positions needed to be eliminated, and how fast did they need to move to preserve the organization’s long-term sustainability?
Organizations are having to make some really challenging decisions right now, and we’re glad to be a partner to our clients as they navigate them.
A strategic partner, not a vendor
Q: What gap does fractional CFO support fill for small and mid-size nonprofits?
A: Many small to mid-size nonprofits have a director of finance in house. What we typically see is that the person they can afford may not have strong skills specific to the nonprofit space. Having access to an experienced member of our team means having a strategic thought partner, not just someone doing the month-end close.
Q: How does that partnership work day to day?
A: We don’t view ourselves as a vendor to our clients. We’re partners. Many clients treat their ContinuServe CFO just like an in-house CFO. That means attending executive leadership meetings, meeting one-on-one with the CEO or COO weekly, reviewing contracts, and weighing in when the organization wants to try something new. One client is exploring an entirely new revenue stream right now, and we’re modeling financial scenarios with them, including how many people they’d need to hire to run the program.
We still close the books and produce the financial statements, but it’s so much more than that. Every client needs a financial package that tells the story of its organization, built around the metrics and benchmarks it uses to guide decisions, so each package is tailored. Fractional CFO and advisory support is especially powerful for organizations that, quite honestly, don’t think they can afford it.
The takeaway for nonprofit leaders
A clean month-end close is the baseline, not the goal. What nonprofit executive directors, CEOs, and boards need is a finance partner who gets revenue recognition right from the start, brings the right systems to the work, keeps the organization audit-ready, and sits at the table when the hard decisions come.
If your numbers feel a little off, or your leadership team needs more strategic guidance than your current setup provides, it may be worth asking what a dedicated nonprofit finance team could return to you.
Wondering what a finance partner could look like for your organization? Talk to our team about ContinuServe’s accounting services for nonprofits and fractional CFO advisory, and let us walk you through how we’d support your mission.
