Not for the faint of heart: Selecting a fiscal sponsorship accounting application

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Any number of organizations in the serve as (sometimes known as "") to projects or associations.  For example, a 501(c)3 dedicated to , might offer to serve as the fiscal sponsor of a project designed to save the , because their missions are congruent, and it's less trouble than setting up a separate entity.  But they're really in the business of saving the whales, not providing services to other nonprofit organizations.

However, a relatively small number of nonprofit mangement support organizations undertake fiscal sponsorship on a large scale, providing not only a but all sorts of to unincorporated projects.  A well-known example is the .

, one of my clients that also does this is .  As of this writing, has 26 fiscal sponsorship clients, and an entire team of accountants, specialists, and others who dedicate themselves to the needs of these projects.  It's intricate work, and they are very, very good at it.

Unfortunately, it's difficult to find accounting and finance that are up to this sophicated task.  The transactions involve multiple , , , and - on behalf of 26 different projects, each of which having records that must be as if they were completely freestanding organizations.  The security issues are enormous, and added to that are the challenges of an accounting application with , , and .

These days, I spend a lot of time researching applications that will meet fiscal sponsorship accounting needs.  This is not a task for the faint of heart, because the specifications are numerous, the solutions are shockingly expensive, and the potential for spending a lot of time, energy, and money without actually improving capacity is very high.

Here are some of the applications that I have been checking out:

Doctors without Borders Podcast Creates Connection

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I just got a press release this morning (I feel so alternative media), announcing that Doctors without Borders/Médecins Sans Frontiéres has started podcasting (yay!).  The podcast, will feature emergency updates from Doctors without Borders projects all over the world.

I just listened to the first podcast.  It was a little over 10 minutes long and talked about medical needs in Sudan, the ongoing challenges in Colombia and how people with HIV/AIDS in the developing world are being denied access to new "second-line" AIDS medicine.  (My advice to the podcast's producers is to put in some success stories too, or listeners will suffer compassion fatigue after a while and stop listening).

The quote provided in the release by Executive Director, Nicolas de Torrenté, encapsulates, I think, why podcasting and blogs are such important tools in a nonprofit or NGO's communication plan:

The NPTech attention stream: now 75% lighter!

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Would you like to participate in the but feel like it's too overwhelming? Is the whole idea new to you? Before describing the drastic measures I took to lighten a reader's load, here's the basics on what it's all about...

NPTech is a tag used by people to designate an item they find online as being of interest to the community of nonprofit technologists. People use nptech as one of any number of tags to describe an item online and that item is entered into the nptech attention stream, subscribable by RSS or email. Since it's in RSS format, you can do all kinds of things with it - see for example the feed of the tag net2 syndicated automatically in the sidebar of this site. ("Net2 elsewhere" is what it's titled.)

Video of Ethan Zuckerman Segment from Citizen Journalism Session

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At , more video now available online: from the  NetSquared Conference Session: A Voice in the Wilderness to the Wisdom of Crowds: Citizen Journalism, Nonprofit Organizations and Social Change (coverage provided by ). Last week we posted , also from this session. If you go to and type in “netsquared” next to the Search function in the top menu bar, you’ll find this session and the others listed here in the archive:

Nata Village Blog

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Last month Nancy White wrote about a very cool blog fundraising blog, the , that I want to share with you.  The blog documents not only the lives of the people in Nata, but is a tool to raise funds for a for residents living with AIDS, an where youth use the arts to educate others about AIDS, and the .

Readers can donate directly to the village through the blog's PayPal account.

Nata is a village of 5000 people in Botswana.  According to the blog, 50% of the pregnant women in the village are HIV positive and 400 children have been orphaned by AIDS.  Botswana has the second highest HIV infection rate in Africa.

Consolidate or die: Will it come to that, for small nonprofit organizations?

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Even though we hear a lot more about national and international organizations such as the , in the U.S.A., most nonprofits have fewer than ten staff members, and annual operating budgets of less than 500,000.  (It used to be possible to look up the numbers for free on and see this for yourself; now, you need a paid subscription to their service.  Alas.)

An amazing number of nonprofit projects are run by one noble soul, working with great dedication from the coffee table in his or her living room.  This person hardly has an information and communication technology (ICT) - never mind an ICT specialist to maintain it!

The plight of this one-person-plus-coffee-table organization worries me a lot, and over the last few years, my friend and I have often debated  whether this organization will be able to survive and be effective in the .  We both think that , and that the one-person-plus-coffee-table organization is ill-equipped to do the online collaboration, back office administration, fundraising, and service delivery that will be demanded.

We don't exactly agree about whether it would be a good thing for these small nonprofit organizations to die out, but I won't attempt to do justice to John's point of view here.  However, I will admit that I worry a lot.

I really like small nonprofits, and I don't think that answer is wait for harsh reality to force them to choose between shutting down and being .  (In the latter scenario, they would be consolidated into a much larger nonprofit entity with a substantial technology infrastructure.)

Surely there's some way for small nonprofits, especially those of the one-person-plus-coffee-table type, to consolidate their technology infrastructures and back office administrative processes, even while each organization retains its hand-tailored (or even quirky) approach to services and programs?

For example, here in Massachusetts, offers its a very full complement of accounting, business planning, and human resources services.  One of my other clients (who is not yet ready to unveil its plan) is working on new model for delivering remote technology services to small nonprofits in the region.  Naturally, I have taken great joy in bringing folks in these two organizations together to talk about how their plans can dovetail.  The timing may be especially auspicious here in Massachusetts, since .  The folks who are thinking about the shared needs and interests of the nonprofit sector in our area are starting to mobilize.

But this isn't just about Massachusetts.  It's about best practices throughout our profession.

Globally speaking, I'd like to see those noble souls in very small nonprofits focus their efforts on what they do best - which could be , feeding the hungry, organizing youth soccer leagues, ensuring access to health care, or keeping German opera alive in Montana - rather than on tasks such as contract management, accounting, or maintaining a file server.  I'd also like to see employees of one-person-plus-coffee-table organizations enjoy some of the benefits that Red Cross staffers can take for granted - such as membership in a group health plan, access to professional development opportunities, and use of up-to-date information and communication technology. 

Let's make it happen!


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