Nonprofits require specialized technology for operations to run smoothly. They need a CRM to organize donor data, event management solutions for events, and—perhaps most importantly—financial software to organize revenue and expenses.
QuickBooks Online is well-equipped to help nonprofits set up their financial management systems. It’s easier to use than many on-premise, clunky systems that organizations traditionally use to set up their finances. In addition, QuickBooks Online offers secure access for all users, automation of many manual financial processes, push button reports to track grants or restrictions, and many integrations to third-party applications.
The nonprofit edition of QuickBooks Online enables nonprofit professionals to use nonprofit-specific accounting language as they set up the system. For example, this version of the software uses the term “statement of financial position” rather than “balance sheet” for the relevant report.
However, before getting started using this intuitive accounting software, your organization will need to migrate your current data to the QuickBooks cloud.
Step-by-step checklist to migrate to the cloud
1. Gather and organize your data
Before you can move your data between different financial systems, you need to make sure your data is complete and clean. Suppose you have mistakes in your system (e.g., double-entry and typos in gift amounts). In that situation, it will be much easier to catch errors in your current system with all of your legacy information, rather than in your new system after you’ve migrated your data.
Review your current system, reconcile your accounts in the old software system, and ensure all your data is currently correct and up to date. If there are any discrepancies, go ahead and take care of them before the migration occurs. Review information in your system regarding donation amounts, pledges, grants, donation receipts, vendors, bills, and any other transactions.
Then, look over your nonprofit’s financial management policies. These should be updated to be accessible and applicable to any accounting system you use. For example, if your donation acceptance policy is outdated, it might not specify who is responsible for recording in-person donations in your accounting system. This is the type of update you should make before migrating to QuickBooks Online.
2. Review your general ledger architecture
Your general ledger houses all your nonprofit’s transaction information and other financial data. Therefore, be sure to review the architecture of your general ledger before attempting to migrate your data to the new one in the cloud.
Your ledger should be set up and ready to scale as your organization grows. Considering this, review your ledger and your sub-ledgers to be sure they accurately reflect how money moves in and out of your organization. Review and assess your accounts, programs, grants, departments, and tracking dimensions that you’ll use when migrating to QuickBooks Online.
3. Use data mapping to match your old fields to your new system
Data mapping is the process of matching the fields in your current financial system with those in QuickBooks Online. You’ll need to map all your historical data to your new system, ensuring nothing gets lost in the transfer of information.
Use the tracking dimensions that you determined in the previous step to map out your historical transactions to QuickBooks Online. Keep in mind that you might need to update some language around certain aspects of your financial system. For example, you might map your past “income statements” to be saved as “statements of activities.”
4. Input your beginning balances and upload data
After you’ve mapped your data migration plan, it’s time to start moving your information into QuickBooks Online! Begin by inputting your beginning balances, then start uploading the rest of your historical data to this new system. If you’re converting from QuickBooks Desktop, QuickBooks provides instructions that will make it easy to export the company file to QuickBooks Online.
5. Perform final reconciliations
Perform reconciliations to check your transactions and reported finances in your new QuickBooks Online financial system. Check all your cash (and equivalent) and credit card accounts to be sure all transactions match up with your bank records. Also, perform reconciliations on your financial reports, such as your statement of financial position accounts and grant balances.
6. Review your finances
Finally, conduct one final financial review of your whole accounting system. Be sure all your reports are saved, transactions are recorded, and policies are updated to reflect your current and future needs.
If everything appears to be in order, congratulations! You’ve successfully completed your nonprofit financial data migration to the cloud.
