 Welcome everybody to another episode of the non-profit show We're really excited to have you here today and we're really excited to have our guest Andy finale McGonagall Because we're going to be talking about all things accounting if you have joined us this week part of this week all of this week We've had a really exciting time with a non-profit power week where we have spent every day with your part-time controller talking about a lot of different things and We don't do this very often. We only do it a couple times of the year Where we take an entire week and we address a certain topic or you know Direction and really dive deep into certain things and so we wanted to kind of finish up with and ask an answer Because we just feel like it's such an important part of what we do and so again if we haven't met I'm Julia Patrick CEO of the American non-profit Academy Jared Ransom the non-profit nerd and CEO of the Raven group is off today and she'll be back with us next week Non-profit power week is is always so interesting and so amazing But we are amazed by the amount of support we get for our sponsors to actually do this Fundraising Academy at National University Bloomerang your part-time controller non-profit thought leader American non-profit Academy non-profit tech talk Non-profit nerd and staffing boutique are the folks that support us It's really important Andy and you you probably know this because you and I've chatted about this But our sponsors don't dictate our editorial direction They have no voice in that and so it's really something they step up and they trust us To talk about what it is we're going to we want to talk about and so our gratitude goes out to them If you have missed or you want to review any of the almost 900 episodes Yes, hair and fire moment 900 episodes You can get to us through our app on any of our streaming broadcast platforms and also in podcast Form wherever you like to consume your content. We are there with you day in and day out In fact, this episode will be uploaded and we'll talk about this a little bit later to the yptc.com Website as well so you can get to the information that we discuss every day with ease and we will meet you where you are Okay, Andy Finnelli McGonagall. Hey coming to us from the East Coast, which is fun We were chatting about that in the green room chatter vertical specializations director Okay, what does that mean? So Good question. It's an interesting title, right? So, you know throughout the week you've highlighted several of my colleagues all with different specializations, so We have you know over I think we're over 1400 clients now In about 30 different areas of specialization in the nonprofit sector so With that pool of talent and over 600 staff members working across all of those different Specializations, we decided it was time to start gathering that talent and formalizing different groups different teams To support everyone else who might not have familiarity with that sector. So My job is to go out and find that talent internally form teams You know who who's who within ypc? And put them, you know form teams put them together and start developing resources and it also helps us Talking externally at conferences and you know having a presence in these key areas So Andy if you were let's say somebody who works in the arts and cultural space You wouldn't necessarily then be doing like uh animal welfare, right? You'd be Are you saying that you kind of pull your talent more to What that nonprofit sector specialty is or as a support function? So for example, you know somebody might Join ypc and they're coming from you know my background was health care and education You know if I was assigned a an arts and culture client I wouldn't I would have a learning curve What do you do you call justine and her team? You know my colleague justine who is heading up the arts and culture specialization. So It's that's really the model. It's not that we're gonna assign everyone clients within their specialty It's just that this team exists as a resource in case you weren't exposed to it previously I love it. Well, we love justine because she's one of our epic guests because she showed up She was epic Full witches costume on halloween Including green makeup. I'm we can't we can't get beyond that. We have enjoyed that The pressure is on because she has said I know And we're like, oh my gosh, and she had like cobwebs and she was amazing I had a meeting with her that morning and I said wow. She's the problem on the nonprofit show She's great. Well, everybody from yptc has been great and it's been a lot of fun The very first person that I met from yptc Was one of your founders eric fraynt and he really changed the trajectory of what we do at the american nonprofit academy and the nonprofit show In some wonderful ways and so it's been an amazing part of our life and our growth to be To be aligned with you. So well, we welcome you here, but more importantly, we need to get You answering some of these questions and they are not going to be super easy So let's start off with the first one Does remote accounting make things more or less Safe, we're all worried about security. We talk about this. It's on the news What say you about this? So I think um, not not necessarily. I think it could go either way I've walked certainly walked into some very unsafe Unsecure physical locations, you know as an associate or as a manager walking into a client and You know checks are laying out signed Anybody could grab a check and walk away with it. So let's certainly not safe or secure So kind of in a way, I feel like remote accounting has forced us more into the digital age Where we're utilizing tools such as bill.com and other bill pay functions Where you don't have those checks laying around. That's just one example. Um, and you've got A secure platform That you have, you know, user access defined you have approval flow workflows So you're ensuring that somebody's approving those invoices and it's really hard to circumvent You can't just walk across the hall and say sign this check. I need it right now So from that perspective, um, you know, I feel like it's actually Remote forced us to be a little bit better Um, one thing that's been trickier is the fact that if you're remote you have to look at what that remote setting is Are you in an office or are people working from home? So in an office You can secure the remote setting because you're in a controlled environment But working from home is variable. Where are the people who are doing the accounting? Who is, you know, what is their home setup? So really shifting and ensuring that that home setup is secure document storage is secure Um, you know, are people leaving files laying around for their family to look at confidential information? So It's just different considerations You know, it's it's interesting too because think about, you know, especially in the pandemic Folks that have a quote-unquote family computer and then all of a sudden, you know, you're on working and then when you're done Your kids are on or your spouse I mean, I I can see where that can make things a little dicey and easier to penetrate Um, something that really needs to be more secure. Absolutely. So yeah, people are looking at a remote solution They need to look at how is this organization handling that aspect? How are they, you know, what is their security? Do you find that your nonprofit clients are even asking you about that? I mean, do they understand To that extent because it's something that is a new discussion in the last I think yeah, it's really new and you know, we Shifting quickly during the pandemic and nobody had time to think about it So, you know, some of our larger clients ask they used to ask before what what's your office security setup? You know, what how can you ensure? um but You know, I think a lot of our clients are are Maybe just getting to that point where they're going to start thinking about it But we don't hear a lot about it. It's something people should ask it's it's fascinating because you just um And we're going to talk more about this but Remote accounting is such a a new concept in the practice and the implementation of it It it's probably filling our brains with a lot of other Questions and concerns and security. We're we're kind of it's it's there, but maybe it's not as high um, really interesting answer. Well, let's go into the next question because this one is um, kind of a It's it's a tricky question And it goes it goes like this innovation in accounting is a trend You know In that part you could say we've been doing accounting In the same way for a long long time and now it's changed up Is this only going to be something that next gen accountants? Are doing or do we have to like and I hate to say it Do we have to wait out that older generation of accountants before we can start really adapting to this digital phase? I mean, we shouldn't have to I feel like accounting You know, you said accounting's been this pretty much the same for a long time. It actually goes back to double entry The double entry accounting system goes back to like the 1400s with the venetian merchants So, I mean not right there. That was innovation, right? They took a big step from stone tablets and and handwritten tallies that maybe weren't consistent So that was innovation in the 1400s and maybe it was a slower growth curve But now technology we're having a faster growth curve and we we all have to keep up with that curve and I feel like you know people talked about that earlier in the week as well is that We have to follow technology or we're not keeping up as an industry as a profession I think the real Difference is and here's another thing that hasn't changed is that The innovation is the second step to the actual transactional work So the transactional accounting is what hasn't changed but the innovation The ability to be transformational and you think about a cfo level role That's that's where you're you're taking that information and what are you doing with it? That's where you have the opportunity To do many many different things. You can forecast you can you can utilize those tools like AI and power bi and and present it in a much more user friendly way It's it's really I love that you talked about this because At the core of it. We still are trying to achieve the same things navigate You know the flow of money and investment In management of of that financial part of our world How we do it is different And and and how we navigate through that It's really an interesting piece of the pie to me because when I talk to nonprofits You can tell the folks that are like I can get that information super fast And then others who like dread going to the accounting and finance department Asking for information knowing that it might take weeks to get it and to me when I hear that And especially I would say andy around Donor inquiries or grant applications award applications things of that nature Shoot what a difference. I mean you can tell the ecosystem of that nonprofit Who's who's more current with their technology and who is not? It's shocking. Yeah I mean, it's absolutely shocking. Well, let's uh, we're we're not pushing out the old accountants yet Let's go on to our next question because it's kind of an interesting one And it's one of those things that I'm going to ask you to if you will get out your crystal ball in some ways Is remote accounting less or more? than onsite accounting and when we say Less or more we're talking about a plethora of things. So let's start with costs because that's What you know, that's a good starting point. So, um, yeah, I mean cost you can I think you do with With remote accounting you do have the opportunity to be more Inexpensive and it just depends on how you are structuring Your remote setup, right? You can Send it to sort of a warehouse of accountants where people are just working on bits and pieces and you don't really have an assigned person That's the most cost effective remote accounting Is it the best accounting? And so if you want to think about more or less that's sort of less in another way, it's You know more cost effective, but less personable Yeah, you don't have that relationship. You don't have that connection. So Um, you could then you know change it to sort of a hybrid model or even a remote model where you have an assigned person You're going to have less flexibility with staffing So you're you're still managing it with one staff member assigned to certain clients But then you're building in that personal element. So it's again, sort of a continuum And then I would say probably the next step would be Hybrid You're starting to get into on-site and I think at this point you're really not really seeing a big cost difference and even on-site You're you're still I think hybrid's probably the best solution because you have the flexibility to work multiple clients in a day Whereas on-site you're kind of limited to one thing a day Right. Well, you know, and I'm thinking of I mean Never has it been said that a nonprofit had too much space, right? And so I'm thinking about like office space and just you know, like the technology and and you know more people more technology More yeah more of this that you know, and it you you have to factor that in because those are real costs. You can't just say You know at the end of the day it doesn't matter because We have to provide for whoever is in our physical space. That's true. Absolutely. Yeah those things The other thing I'd love you you brought this up and that is you know, the hybrid Model, could you express a little bit more about what that might look like and I'm curious Does this really follow the budget? Amount of an organization like over a certain amount. Are you seeing that this is where you have to go? Under a certain amount, you know annual revenue. What does that look like to you? um, I don't know that it If every if if you know all those other factors we talked about earlier like document storage proper systems, you know that's all in place It doesn't make a big difference, but um Sorry, I just lost my train of thought No, that's okay. I'm just thinking about like can or should we align this to What our our annual budget is so like if you if you're like an under 10 million dollars, don't worry about hybrid But if you go to 20 million you need to really be in that or or does that even matter? No, I don't think it does I think if the systems are in place that the advantage to hybrid is that okay You don't have to provide all that infrastructure of a full staff working there But you have the ability for those people or person to come, you know To come in as needed for critical meetings Board presentations Okay, so that you have that you develop that relationship you can do some of those critical things in person and Really just add a little bit of more value by that personal relationship You know, it's it's interesting too. I would say A part of me knowing the yptc folks as I've gotten to know them Um It seems to me like if you send if you have the ability to go on site You might find that there's an alignment that gets created that you haven't thought of that, you know, the yptc member or Whomever comes in and it's like, hey, you should talk to you know, my friend Derek Durer because he does Government funding and he might be somebody who if you've never thought about this or you're having problems You could talk to or you know what i'm saying, you know with your data viz team and it I'm wondering if that ever happens that it's just organic You're exactly you mentioned, you know the water cooler conversations and that's exactly what you miss by not being on site Uh, you know, you have great interaction on zoom. You can schedule meetings. You can schedule lunch But you don't have that Organic Oh, you know, you're brainstorming together ideas emerge usually more limited in your time You've got a scheduled one hour zoom session And you're getting your work done and you're getting off the call Right, right because you're moving on it's it's people are lying down Really interesting. Well, let's move on to our our next question because this is one of those things that Again dealing with some new technology and new workflows and understanding How to think in a different way dare I say? Because of this process How long does it take to adopt a remote accounting procedures? Because there's got to be a learning curve For sure, um, and and that really it depends but I think the pandemic was an excellent example Of how you can do it really quickly. We were forced everyone Was forced to pivot and Yes, there was a learning curve, but It became a priority that that learning curve became a priority. We had no other choice Um, normally, yeah, people could be resistant to it. You'd have to retrain. I don't want to use zoom I don't want to use bill.com. I want to do my way and you have to talk to people and hold their hand You have to have training sessions where we were just you know from from what we saw it was just okay This is this is where we're going pandemic. This is what we have to do So I think that taught us that you can do it very quickly you get past some of those human resistance factors that are natural And you can go very quickly You know, it seems to me that this conversation is going to be one of those things where we're like Oh, yeah, that's right. We didn't always do it this way. Are you know, we'll we'll get if I Maybe describe it as a new reality Like this is how we do it. I mean you you started off with Going into the accounting department and the checks are there. They're don't use the printer. I've got checks in it You know, right? I'm dating myself. No, absolutely. That was such an issue Such an issue. Oh my god Such an issue. I mean checks are expensive and then you'd be like And you'd be like, ah, no, I gotta re-rack everything and Yeah, I mean, it's such an interesting thing to even Think back to that. I mean to me that seems like the dark ages But it wasn't that long ago. It wasn't it wasn't and so You know, that's one of the the beautiful things about the nonprofit sector in many ways. Um, I think we can change We just necessarily we don't necessarily change when it comes to Our business part. I think we're great on programming and we're great on Identifying a problem and you know switching in the hubs and let's get going But on the business side, we've been woefully behind In this sector. It's it's been it's really kind of an interesting And sad and sad thing and I think that Jared and I talked about this a lot um Our observations about how other sectors ramped up very quickly to to embrace change in the nonprofit sector has been Kind of behind This next question is so different But it's one of those questions that I get asked a lot about Pardon me Especially with my board training and my board engagement How do we get a remote accounting firm to communicate with our board? It seems to me Andy more and more boards are asking somebody from the accounting finance department to come in During that board meeting and give a presentation and it's not just the audit group. I mean that's something else But you know no money no mission getting down to the brass tax during that meeting. How does this Function occur when we're talking about remote accounting services um Again, this is something that was you know people had to pivot during the pandemic the board meetings themselves were On zoom so the point whoever you were bringing in to present on accounting whether they were normally on site or not They attended via zoom so you could always attend via zoom I think the key before I get started. I think the key is though There should be a knowledgeable representative from the accounting and finance function present at the board meetings Okay, good answer those detailed questions to you know instead of it's it's great if the treasurer can can present and has the knowledge but I really think there's so much more value to having that extra person present in some way shape or form whether it's in person or on zoom um And so that's really the you know That's how they they should they should communicate by being present And whether that's virtual or in person is is doesn't matter. Um, I I have you know, we do see many many remote operations that that take the stance that They they communicate with the board by handing them a packet And that's great communication. Great. That is that is certainly a form of communication. But That is not the should that's not how they should communicate. It's just a piece of it It's the first step Are you seeing more and more, uh, nonprofits using board portals? Where where, uh, information is being uploaded, you know, as because you brought up that word and just You know pinged my brain about the the board packet, which oh my gosh. Yeah, the board packet was always such a big deal right more of these board portals whereby All the information is uploaded and it's there You just have to be responsible and have a responsible enough team to go through it And I would have the same thing with the board packet I was going to say, I mean, I haven't seen the board portal, but I think it's it's the same thing You can hand some on a stack of papers Or you can put it in a portal and that board has to take the responsibility to read it and do their their due diligence and and You know their fiscal responsibility Yeah, yeah, it's a really important thing and and I feel like And and maybe this is kind of one of my last questions to you But I feel like a lot of board members don't truly recognize The fiduciary responsibility that they have that their name address And information goes on that 990 that is filed with the federal government Absolutely. I mean, it's it's it's something that that I see a lot, you know board members they they want to they want to Participate they want to have their say they want to have that title. They want to tell their friends And they also genuinely want to do good by the organization But they don't realize the fiduciary responsibility piece They really don't a lot of times and it is it is huge and in some cases And especially when it comes to like payroll taxes, they could be personally liable Yeah, I I know a lot in our board training I always call that the christen kiss and cry portion of our trainings because You know, I can look out into a sea of people Or be talking with somebody and You can just see it on their face that they really had no idea and it's quite frightening. It's quite frightening because You know, not understanding or not knowing is is no defense You know, the reality is you you are responsible for that whether you understand it or not And so it is one of those things that We need to make sure we do a better job. I don't care if you're in accounting or finance Any type of leadership That those board members need to know that before they ever come on And I think that's you know Another advantage to having that presence at the board meetings because if they didn't read it You have someone there walking through and talking about it and making sure they didn't read it They at least they at least heard it. Yeah. Well, we've heard you. You have been great. Andy finale McGonagall. It's really been a pleasure To to be able to get your wisdom You know being in the hot seat at the end of the week is always interesting because so many things have been flying by us and and our week with yptc Has been very interesting and and quite varied. We've talked about a lot of different things And so to kind of have somebody come back I'm at the end of the week and frame it up for us has been really great Andy finale McGonagall vertical specialization director coming to us from We're a place where they have fall Which blows my mind because we're in the west. We don't get too much fall here But in the east you're getting fall and so Andy this has been just lovely to have you be A part of this discussion, you know, it's been A lot like I said a lot of information and just our conversation with Andy So many different ways to think about things But one of the great ways that you can help you your organization and yourself is to go to the yptc.com website Whether you're a client of theirs or not. They have a tremendous amount of Free and accessible information from webinars to blog posts All sorts of things great articles about their Team members and the history. They're celebrating 30 years of business in our country And so it's a really cool thing to be able to get back with them to see what they're doing So check out yptc.com Wow, this week we've had an amazing group of women talking about different things again We want to make sure that we give our gratitude to alisha eastwald susan wagner Of course, andy finnelli mcgonagall teresa hinderson harry hatsy kesshall kesshall who I was one of the first people beside eric that I met years ago And so that was fun to reconnect with her I also want to give a thank a shout out of gratitude to The amazing gerilyn dressler who I personally work with Our team works with so that we can get all of this together because this is a heavy lift Probably why we only do this a couple times a year, right andy because this is a big big thing to put all this forward Nonprofit power week again Sponsored by fundraising academy at national university bloomarang your part-time controller american non-profit academy non-profit thought leader staffing boutique non-profit nerd and non-profit tech talk These are our partners in these amazing discussions coming up on 900 episodes In october which blows my mind And they have been on this journey with us. So we want to make sure we say thank you Andy you did really well being in the hot seat my friend. Thank you You know, it's not easy. I before we got started in the in the green room. I'll witness to this I'm like now andy no pressure, but you're speaking for the entire sector here today You did great. I loved what you had to say and I think it really helped a lot of folks And so we say thank you. Thank you for being a part of this. We really do Hey everybody, we like to end every episode of the non-profit show with us mantra and as we end up a very busy week It's even more important to go into the weekend with Our saying and we it goes like this to stay well So you can do well. We'll see you back here