 I would like to welcome all of you and say thank you for joining us for another episode of The Nonprofit Show. We have already been enjoying our Chitty Chat Chat with Teresa Henderson, who is a CPA and manager with your part-time controller. Teresa is here today to talk to us about those new realities that we need to consider when it comes to remote accounting. So before we dive into this conversation, we of course want to say thank you to all of our presenting sponsors. We are so extremely grateful to have your continued support and your investment, not just in these episodes, but truly in the sector at large. So with 1.8 million nonprofits across the United States, being here for the sector means so much to all of us, and it really helps to drive our communities forward in their mission-driven goals. So thank you again to our presenting sponsors. And again, thanks to your part-time controller who has provided this Nonprofit Power Week. It has been a week solely dedicated on accounting and financials, in particular your part-time controller that is a nationwide firm. They literally exist in your community because they are everywhere. So we're so grateful to have you as a presenting sponsor and a partner for today's Power Week, or this week's Power Week, in fact. So Julia Patrick joins me as the CEO of the American Nonprofit Academy. I'm Jarrett Ransom, also known as your non-profit nerd, CEO of the Raven Group. And if you joined us for the Chitty Chat Chat, you heard that Teresa Henderson called herself a nerd, and that is a huge compliment. And I love it. I need more nerd sisters. Teresa, welcome and thanks so much for joining us. Hi, I'm so happy to be here. I know my colleagues have, like you said, knocked it out of the park earlier this week. We love talking about accounting, and so we're glad to deal with you guys. Thank you so much for inviting us and having us here this week. You know, it's really a lot of fun. And I think that it's an interest. The pandemic has done so many amazing things for and to all of us, right? And I think that one of those things has got to be remote accounting services. And so we really are excited to have you talk with us because Jarrett and I have seen just an explosion of digital products and processes for the non-profit sector. A lot of them revolve around fundraising and donor management and donor cultivation and communications. But accounting, accounting can be online, digital, remote, all those things. So we're really interested to hear what you have to say. And the first thing we've got to talk about is this even safe? Yeah, that's a great question. It's a great question to ask. And I will just pick up where actually some of my colleagues have already talked about. Yeah, I think that there are, as you mentioned, there's a number of applications, online applications, that have evolved recently and in particular the cloud-based accounting systems. I think we were already moving in this direction. I mean, I can't imagine what working in the pandemic would have been like if so many of those software developers weren't already working on cloud or web-based versions of the systems. And so a lot of our clients were thinking about it, maybe moving in that direction. And so of course, as you can imagine, many of them have moved from that desktop version to the web-based version. And included in those web-based versions are a lot of the safety systems. And so it moves from those non-profits having to make sure that they are secure, that they are backing things up to now people who do it for a living, that experts are really focused on the data security, that experts are focused on making sure that your data is backed up. And so I think in many ways, the accounting systems are now more safe because built into the regular processes are some of those safety measures that accountants or that non-profits have been meaning to get to. Wow. That blows my mind. I mean, did you think, Jared, it's kind of, it's not what you would expect to hear? Yeah. Yeah, I think so. I mean, because you think about your accounting information is kind of going out there and you're not quite sure what's happening, you know, you're not used to people are used to thinking that if they have it in their control that that is maybe that's where the safety is. But really you want to make sure that it's in the control of people who know how to manage the data and know how to take care of it. So I've said before, I know you've heard it, Julia, but I have really felt, Teresa, that our sector, the non-profit sector has truly been due for a shake-up. And what you just said is that these systems actually have probably an even more enhanced safety measure or tools in place is just what we needed. And I don't know, there's been a lot of silver linings I want to acknowledge that have come out of this, most of them by default. But this is something that I think, you know, one of the things we've talked about before, Julia, is what will you continue to do because it worked so well during the pandemic that now will become standard practice? And I think remote accounting is one of those. Yeah, I agree, I agree. And along with accounting systems, a lot of the systems, not just the donor side, so not just the incoming or cash receipt side, but even the payment side. So a lot of our clients are going to payment solutions. So like a bill.com or something that manages their payment flow. And there are safety measures built into that as well, just making sure that, you know, I think my colleague Bill talked about positive pay. And some of those payment applications have a positive pay built in. So you don't even have to sign up or supply an additional list. It's already inherent once you've approved those payments, no other amounts or vendors are going to get checks if somebody changes the check, which probably isn't going to happen. But it just a lot of those additional systems that make remote accounting possible, there's just additional safety features built into them. So that's that is good news. And I think those are things that will continue to endure and will grow. So what I hear you saying is for the layperson, like me and Jared, don't be afraid. Right. Like this actually is not just a crisis driven issue. It might ultimately be the most efficient and secure way to go. Yes, I that is what I'm saying. And don't, you know, don't hesitate to do your homework, ask questions. But most of these applications and most of these folks who are comfortable working with these systems can answer your question instead of just kind of wondering what's happening. There's customer service and there are help lists and trainings involved to help to get you the information you need. So you can feel more comfortable. Wow. Are you finding that CEOs or I'll just say, you know, leaders of the organizations, are they eager to adopt these remote accounting practices? Or is there a bit of an obstacle in the way? I can imagine the board, especially as we've talked about having that fiduciary oversight. Like I'm just curious, how is the adoption of this process? It isn't always a straight line. I think that you've asked a question. It's not always a straight line because I think people are very comfortable with what they know and they can see. And this takes it out of the realm of both, right? It's something that's unfamiliar and it's something it's releasing control or what feels like control. So sometimes it's a cost benefit. I've had clients where a series of maybe unfortunate events happen, checks that were mailed that got lost. And it happened repeatedly. And so that drove the consideration. Well, is this payment system you've been trying to get me to implement, would this solve that problem? And so they've considered it as an answer to other problems they were having. And so, you know, as your part-time controller, sometimes we are looking for those opportunities. What are some of the challenges that we've had? What are some of the problems that we've had? And how would these systems address or minimize those problems? And so it's been a little bit of work. And then maybe once you get the executive director on board, it is explaining to the board of directors, you know, how will this, how does this enable you to get more visibility into the operation or to, so for board members that might have to sign checks, for example, you know, you don't have to now come by the office anymore. We don't have to make special arrangements for, you know, we can build it into how the application works to get you visibility and to get you the ability to approve and to get you the information you feel that you need in order to be able to approve it. It's all of that is built into these applications. And so once they get to see the advantages to working that way, and they do have to see it, you do have to show it to them. But once they get to see it, a lot of times they're in favor of it. And then once it gets going, they're very happy, they're very happy that they've done it. Okay. Well, let's talk about that a little bit more of that drill down because it is such a new and exciting time. And there's so many different companies coming online. What can you share with us about navigating companies that are working with US based, you know, teams versus overseas? And if that's something that is even a consideration? Yeah, that's also a great question. So, you know, I can talk, of course, most about US based, since that's what your part time controller is. And I will say, you know, one of the first things that occurs to me in terms of the difference and is the time zone. So if you're working with an overseas based firm, you know, does the time zone work? Because you really want to be able to when you establish these remote relationships, you want to have a relationship, you want to know the people that are working in your books that are working with your finances. And if they're working at a 12 hour difference from you or a nine hour difference from you, you know, how easy is that to do? Can you reach out to them? Can you get to know them? And so the first difference is that time zone. You know, and another thing is the relationship a lot of times overseas based and implicit in that it might mean they're managing it kind of as a firm and not on a one to one relationship at your part time controller. We have what we call a dedicated associate. So that person joins our client team and they become part of that client team. Again, thinking about that relationship. So there's they're talking about the expectations. Here's the work that I intend to get done. Here's when I intend to get that work done. If I have questions, I know I can come to you. You'll know what that, you know, when you're expecting to see the final result. I also get to know what's important to you. And so in that overseas relationship, are you able to identify and build a relationship with not just the firm, but the people that will be working with your firm and the people that will be working with your organization? And are they working and helping you to accomplish your mission and do what you do to make the world a better place? So, I mean, yeah, I think you just hit the nail on the head because that is something I've heard often is that, you know, well, I really want my finance person to be here on campus, you know, at their desk, kind of like in the office part of the culture. But really what I'm hearing is remote accounting doesn't necessarily mean that there is no relationship built and that they really, they be the accounting, you know, firm, just like your part-time controller here, you serve as that extension of the team. You're having these same high-level conversations that you would have if you were, I'm going to say on the payroll, right? Like as a full-time person, so you are an extension of their team and that's exactly what your part-time controller is providing if I'm hearing that correct. And you have access and a relationship built with this person so that when the systems or the world changes, right, you have, it will, you have that thought leader. Yes, and we want to make sure, as part of what you want your accountant to do is not just make sure that the numbers are reliable, you want that, you want to make sure that the numbers are recorded properly and they're recorded timely, but you also want to make sure that once they're in there and you look at these reports, those reports are meaningful to management, to the executive, to the board and that takes understanding both ways. The accountant needs to understand what's important to you so they can know what to highlight in the report or they can know even, it starts even earlier than the reports and this is where the accounting nerd comes out so please forgive me when I just take a little deep dive and say when they're setting up that chart of accounts and when they're setting up the policies and procedures and they're setting up that flow, your accountant needs to understand what's important to you, what's important to your nonprofit so they can design those processes so they can design, so when things go through the system that they come out in a way that is meaningful to you. You know, Trace, I'm sorry, go ahead. I was going to say your partner Ellie really drilled that home, I think it was yesterday, but as part of these series is really that financial understanding from the board and so to have the financial narrative, to have an understanding and to know what's important to the organization and that's where that relationship comes in and that is so critical. It is really critical and again, one of the questions I think I asked Jennifer on Monday in regards to fraud was really about having the extension, having your part-time controller, being a part of the team and helping to forecast and change the forecast of the budget as, I don't know, normal comes back in life or chaos hits again, really knowing that partner, what's important based off of what you're saying, Teresa, and then really having that ability to re-forecast the budget and the financials accordingly. Absolutely, absolutely. And you know, maybe you can do some things by math, in other words, maybe you can take a budget for salaries and divide it evenly throughout the year, but there are so many other things like when is cash going to come in or when are your contributions going to come in or when are you going to actually hold that fundraiser, and so when are some of the expenses going to fit, those really require getting to know you and making sure that the board, what the board is expecting to see connects to what those individual program managers are doing and sometimes finances that bridge and helping everybody understand what everybody else's priorities are. So this is a, I'm like sitting here thinking and listening to what you're saying, I'm thinking about two things come to mind. One of them is I don't care what it is you're purchasing or contracting in the digital world. Something that struck me was really powerful today, and that is you should know who your team is going to be. And I don't think anyone has really talked about that. We've had a lot of digitally oriented companies, don't you think Jared, I mean that's one of the biggest pitches that we get are new companies that want to come on and talk about their products. But I haven't heard anybody frame it that way that you're going to actually be able to communicate through the camera. So that's an interesting like aha moment for me, but I'm wondering, does this mean that you are like zooming in on the board meetings and somebody from that team is there? Like what does it physically, how does that physically manifest itself when we're working with boards? Yeah, that's a great question. And so absolutely, if we always offer to make sure that boards know that we're welcome up or we want to come and present financials to the board. And so maybe that means not just presenting the financials but helping the board understand what does this mean? Like what are the nonprofit accounting rules because you can have a board member who is very familiar with for profit finance, but maybe they don't understand nonprofit accounting rules. And I'm sure, you know, I know Ellie talked about that, you know, just making sure they're very smart. They know what they're doing, but nonprofits do have different rules and it is can be complicating and confusing. And so sometimes we just explain what this means. And we will, yeah, zoom in on a board meeting. And so that's another thing that this silver lining, you know, maybe has happened from the pandemic is that many more of these board meetings are by zoom. And so we can attend, you know, the board meeting beginning of the board meeting. So, you know, we don't have to be there for the whole thing, but just to make sure that everybody understands and can ask questions and we can follow up. And I think that's added a lot is being able to attend more board meetings more frequently. Amazing. Really amazing. Well, so now we got to ask the big question because we are talking with accountants. And we want to know the reality. Is this going to save us money? Or is this going to cost more? Well, can I say yes to both? Okay, yeah. So I'll say that I think that in some ways it can save money. Certainly, you know, if you can hire a portion of a controller or a portion of a bookkeeper instead of, you know, being responsible for their entire annual salary, I think that that will save, you know, some money. And then maybe along with it, you also, they may come with their own equipment. So maybe they may come with their own computer and printer. So you might save a little bit there as well. But, and I guess another thing that I would say is too, is if your firm or your nonprofit is getting audited, hiring a good bookkeeper and a good controller can make sure that your books are in order. So your audit is faster, more efficient, and therefore cheaper. So you can probably save an audit fees if you get a good controller that makes sure your books are in order and that you throughout the year you followed your policies and procedures. And so the documentation is in place. That means that these these purchases or that the contributions, everything is in order. So the audit can be a little cheaper. But I think one of the things that most of our nonprofits get out of hiring, at least your part-time controller is a higher return on investment for the other positions that aren't accountants that have been filling in the role of the accountant. So you get executive directors, if it's a small organization, who are filling in as the controller or the accountant and they're entering stuff into the system that's driving them crazy. That's taking good time away from the mission, you know, the time that they would spend dedicated to that mission or the time that they would spend explaining the the mission to funders, office managers, same thing. A lot of times these nonprofits hire these amazing, upwardly mobile, you know, office managers or office or operations assistants. And so they're able to do a ton of things. But that accounting piece is taking good time away from them doing their mission work. And so bringing in a controller or a part-time or a remote accountant can take those duties away from them. And you're now spending, maybe you're spending a little bit more because it wasn't in the budget before, but just think how much more it is to get, you know, 10, 15, 20 hours back from that executive director who was spending time entering stuff into the accounting system. Yes, I was thinking, you know, especially because that is such the culture of nonprofits is so and so can do it or we'll add this on so and so's plate or table or list, right? And often as I had shared with you before we went live, financials is not my zone of genius. So I can imagine when you add this responsibility to someone's plate that may not have that, you know, expertise, then it does take more time, takes, you know, take some frustration and frustrating moments. So I'm thinking when I hear, you know, where are we saving? Could be a cost savings, could be a time savings. And there's so many ways to really consider the benefits of this. But that to me was like really where I went because having this remote accounting relationship also, you know, removes any vacation days and hours, benefits, things like that that are directly related to financials. So you can see that financial cost savings on some of the pieces, but then also seeing the time saving from as you said, the executive director or whomever, that would be a huge advantage. Exactly. Exactly. So go ahead. I think she also like really helping to build a succession plan, like helping the organization understand, this is where we are with financials. So as we look at a succession plan, and I hope every organization at least has a consideration of that, having that remote accountant be, you know, a true permanent space for your organization, that's a huge benefit as well. Absolutely. Yeah, absolutely. Helps with the succession planning helps with the growth of the organization, right? Because if everybody is operating in their lane and doing what they do best, it just makes the organization more successful overall. And so, you know, so amplifies the need for good succession planning. So it really all feeds itself. I don't want to say accounting saves the world, but we don't, but we do save the world. Well, you know what? I do think that numbers save the world in many ways, and we don't always know it, but it's there. So we've had a couple of questions come in, and I want to ask one of them. We've had some great feedback. Somebody's just written in great presentation. Beth writes in, what about helping to organize events like auctions when it can be very hot hands on, how would the accountant, you know, be involved in a remote way? Can it even be done? That's a great question. So a couple of different things. So one is, again, if you're getting someone who is, who works in this field a lot, a lot of times they can shortcut the, maybe the regulated, the regulatory process towards getting some of those things set up, like maybe you need a special permit or something like that, and they can help you fill out those forms or interact with those offices and get that done. But again, a lot of the, what happens is now is you're getting these systems set up, these applications, payment applications to facilitate collection when you're doing an auction. So maybe the remote accountant isn't going to be on board, but if they help you get those systems set up so that you make collection easier, or that you make recording or reporting that information once it's over easier, that that's one way that they can help. I mean, again, right now we're still in the pandemic. And so a lot of our clients, a lot of nonprofits in general are still having virtual events. And so, you know, you're, if you're accountant, if you need that remote accountant to log in during the time of that virtual event, that makes that possible. So, you know, again, right now, while we're in the pandemic, I think they can work with you as long as you're having remote, or yeah, virtual events. But I think even in, even where people are having in-person events, that remote accountant can help you with the set up so that the information comes in, it's good information, and then they can help you with the reporting after the event is over. Yeah, it's that reporting. And then I would imagine too, like what you were talking about the squirrely nature of paying vendors or paying last minute things. And I think that's where a lot of issues can arise because when you're in an event and you're trying to get things done, a lot of times it's very easy just to say, okay, yeah, do it or you agree to things that aren't necessarily going to be the most mindful. That's really, really interesting. Wow. Well, it's hard to believe that our time has just flown by like that. Jared, what are you thinking now? I mean, with... I think Teresa is my new best friend. I know, especially when it comes to nerding out. I just love it. I love it when someone really knows what they're passionate about, owns it. And again, we had said the bar is high Teresa because this week has really just been a slam dunk. And you right along with the rest of your teammates are just fantastic. So for me, knowing that you're part-time controller truly is this dedicated accounting firm working exclusively with nonprofits. I just like, it's amazing. It is so important because I've seen it all too often, Teresa. And I know Ellie talked about it as well, who is equally awesome, is many times we do find someone that has financial background and we say, great, you're our person. But as you said, and everyone said this week, nonprofits have their own little nuances. And I've even said, when you know one nonprofit, you know one nonprofit. Right. That's exactly right. Yeah. Thank you so much. We could keep talking forever. And it's just been a true pleasure having you here this entire week has been amazing. So again, today we've been chatting with Teresa Henderson, manager with your part-time controller. I'm so grateful for you to share with us about these new realities as many of us are continuing to look at options in particular when it comes to remote accounting. So thanks again for sharing your time and expertise. Thanks for having us. Thank you for having me. It's been a lot of fun. Hey, I've been joined by the nonprofit nerd herself, Jared Ransom. I like to call her my nonprofit nerd, your nonprofit nerd, the nonprofit nerd. Again, I'm Julia Patrick, CEO of the American Nonprofit Academy. Again, our thanks and profound gratitude to all of our sponsors who are with us day in and day out. We also want to remind you that YPTC has a really interesting new podcast called Mission Business. And it's just fabulous. It gives you an opportunity. You don't have to be one of their clients. That's the cool thing. It's a free communication that you can get into and see what they're talking about. We were chatting with Jennifer early on when we first started two years ago. She was one of our very first guests. And there were times because of the changing nature of legislation that she would literally have her cell phone and she'd be like, okay, yep, that just passed. You can now file for the PPP loans and all this. And so that's kind of what Mission Business is all about, keeping current and giving you new ideas. So check them out. Again, nonprofit power week. What an incredible journey we've been on with YPTC. Really interesting episodes. We've talked about fraud. We've talked about bankers in your boat. Very interesting and something we don't talk enough about in our sector. Financial best practices for our boards. Of course, we've had Teresa on today. And now tomorrow we're going to have Ask and Answer, all things accounting. So that'll be really a lot of fun. So join us for that. Wow. Okay, Jared, you ready to go out there and make some money? I am. Yes. Now I know what to do with this money. I'm going to call you a part-time controller. Thank you. I love it. Well, you know, we like to end every episode with this mantra. And I think we really, really mean it now more than ever with this resurgence of the pandemic. And that is to stay well so you can do well. Thank you, everybody. We'll see you back here tomorrow.