• Andy

    June 1, 2023 at 2:02 pm

    <div>I have dealt with this issue both as a former nonprofit auditor and now as a Treasurer/Bookkeeper. It seems the best approach as alluded to in some of the responses is to put priority on substance over form. When I was involved in audits we did compare the fundraising database total to the relevant total numbers shown as revenue. As long as the two numbers were reasonably close, that indicated some integrity between the two systems. There were of course times when they were not close and that had to be reconciled by the organization.

    I have been recording DAF funds as individual donations rather than foundations when it is clear they represent an individual payment routed through the DAF or equivalent. It is best for the substance to indicate the true type of the donation. In my experience in many audits, there were often differences between the GL and donor database on specific classifications. Rather than spend time to fix such things (when time is always at a premium) it was most efficient to compare totals between systems. So one method is keep showing the funds as intended by their substance and then have a quarterly or periodic total reconciliation to show that both systems agree.