So many persons believe that practicing accounting in a not-for profit is challenging, boring and annoying, however, I beg to differ with the last two adjectives. Working as the Finance Officer at Connected Development [CODE] has been both challenging and exciting at the same time.
Okay we know Accounting is the art of identifying, recording, classifying and summarizing in a significant manner and in terms of money, transactions and events, which are in part at least, of a financial character and interpreting the results thereof to make informed decisions. while Financial reporting has to do with reporting transactions and providing receipts so as to justify every transaction made while adhering to the seven principles of financial management for Non Governmental Organizations which encompass stewardship, accountability, viability, transparency, integrity, accounting standards and consistence.
For credibility purpose when reporting, you will always be expected to provide receipt to justify every item included in the financial report. Getting receipts which shows proof of payment can be somewhat difficult especially when dealing with people in rural communities or trying to suggest the use of cheapest means of expenditure to them, but I thought, why not create a system that would work for me and by extension the organization. CODE’s mission is to empower marginalized communities which results to the focus of most of our projects in rural communities. Working with people in rural communities can be challenging but the quicker you can get a system that will work for you, the better, instead of preventable oscillations.
In order to create a working system, I devised a mechanism of developing a form receipting. This receipt does not necessarily carry the “typed organisation’s letter headed” document but a form where it can be handwritten and signed by parties involved.I also developed what I termed the “unreceipted” transport claim document where community reporters would have to list out all local transportation expenses incurred during the course of the the respective projects such as canoe fares, bike fares, buses etc. This is in an effort to ease reporting for me and to justify every single penny leaving the organisation’s purse.
After all, in accounting, reconciliation is the process of ensuring that the balances of two account are in agreement through making sure that money budgeted would later reconcile with the actual money spent, whether it was over-budgeted or under-budgeted. One of the ways in which reconciliation can take place is examining/matching existing records and receipts for effective documentation.
So you see NGO accounting is not so difficult especially when the personnel involved can deploy strategies and creativity for quality accounting. Next time you think NGO accounting is boring, challenging and annoying, think again – In fact I can emphatically say it is interesting, yeah it can be challenging but exciting.