How do you choose the right cost accounting software for your nonprofit?

3 Compare the features

After narrowing down your options, you should compare the features and functionalities of each software solution in detail. Look for features that can help you perform cost accounting tasks more effectively and efficiently, such as cost allocation methods, cost reporting and analysis, and cost compliance and audit. The software should allow you to allocate costs based on various criteria, such as direct or indirect costs, fixed or variable costs, or percentage of time or resources. You should be able to generate and customize cost reports and dashboards to measure profitability, efficiency, and impact of your programs. Additionally, it should enable you to analyze cost data and trends, compare them with your budget or benchmarks, and comply with accounting standards and regulations like GAAP, FASB, or IRS. The software should also facilitate your audit process by providing accurate and transparent cost records and documentation.

4 Test the usability

When selecting cost accounting software, it's essential to consider its usability and user-friendliness. You should test the software yourself or request a free trial or demo from the vendor to evaluate how easy it is to use and navigate. Consider criteria such as the user interface, user experience, and user support when making your decision. The software should have a clear and intuitive user interface that can guide you through the cost accounting process and provide relevant information and feedback. Additionally, it should offer a smooth and satisfying user experience that can enhance your productivity and reduce errors and frustration. Lastly, adequate user support such as online help, tutorials, manuals, FAQs, or customer service should be available to assist with any issues or questions you might have.

5 Check the reviews

Finally, you should check the reviews and ratings of the software solutions you are considering, from other nonprofit users who have used them before. You should look for honest and unbiased feedback, that can highlight the strengths and weaknesses of each software product, and how they have helped or hindered the cost accounting process and outcomes of other nonprofits. You should also pay attention to the customer satisfaction and loyalty scores, and the frequency and quality of software updates and improvements.

Choosing the right cost accounting software for your nonprofit can be a complex and time-consuming decision, but it can also be a rewarding and worthwhile one. By following these steps and questions, you can find a software solution that can suit your nonprofit's needs, goals, and budget, and that can help you improve your cost accounting practices and results.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?