Should You Outsource Your Not-for-Profit’s Accounting Functions?
Many not-for-profits operate with lean financial teams, where one person juggles everything from bookkeeping to compliance reporting. If your organization is struggling to keep up, outsourcing some or all of your accounting functions could be the key to freeing up time for mission-focused work. But before making the switch, it’s important to weigh the benefits and considerations.
Is Outsourcing Right for Your Organization?
Outsourcing can be a strategic move for not-for-profits looking to gain specialized financial expertise without adding a full-time employee. If your team is struggling to manage complex accounting tasks, grant reporting, or compliance requirements, outsourcing may be a valuable solution. It can also be beneficial when financial tasks are diverting focus from fundraising and program management, or when frequent staff turnover leads to inconsistencies in financial reporting. Additionally, organizations preparing for an audit or seeking stronger internal controls may find that outsourcing provides the stability and oversight needed to ensure accuracy and compliance.
Key Benefits of Outsourcing
Access to Higher-Level Expertise – Work with professionals who specialize in not-for-profit accounting, ensuring accurate financial reporting and compliance.
Cost-Effective Financial Management – Pay only for the services you need, avoiding expenses like salaries, benefits, and training.
Improved Internal Controls – Reduce the risk of fraud and errors by having an external team oversee financial transactions and reconciliations.
Scalability – Easily adjust services based on your organization’s growth or funding changes.
What Can You Outsource?
Outsourcing doesn’t have to be all or nothing. Many not-for-profits selectively outsource key functions based on their specific needs and budget. These services can include processing payables, receivables, and cash transactions; reconciling accounts at month-end; preparing financial statements, budgets, and forecasts; assisting with grant and tax reporting; and enhancing financial communication with the board. Some organizations also benefit from outsourced CFO services, gaining high-level financial oversight without the full-time salary cost. By outsourcing these functions, organizations can maintain financial accuracy and compliance while focusing their internal resources on advancing their mission.
Addressing Common Concerns
Loss of Accessibility? While you may not have an in-house finance team, a good outsourced partner will ensure consistent communication and scheduled check-ins.
Transition Challenges? The initial learning curve is real, but a structured onboarding process ensures a smooth handover. Working with a trusted provider like CSH, which specializes in not-for-profit accounting, can make this transition seamless.
Cost vs. Value? While outsourcing may not always be cheaper than hiring internally, it provides specialized expertise that can prevent costly financial mistakes and reduce audit risk.
Take the Next Step
Even with outsourced accounting, your leadership team and board remain responsible for financial decision-making. However, working with a firm that understands not-for-profits—like CSH—can help your organization optimize its financial management, enhance compliance, and ensure long-term sustainability.
Curious if outsourcing is right for your organization? Let’s discuss how CSH’s not-for-profit experts can support your mission-driven work.
