Managing Income with Gnosis & Quickbooks

Gnosis introduces quite a bit of automated flow into your processes and it can be difficult at first to understand how to “keep an eye on things” with the new automation. This article includes the following sections:

• Financial Management Changes (Process Flow and Reporting)
• Efficient, Effective, Auditable Management of Income
• The Benefits of This Process Flow

Financial Management Changes (Process Flow and Reporting)

The most significant financial management changes that occur when implementing a Gnosis system are:

• Online transactions occurring automatically without you directly involved in the process.
• Separating donor management from the accounting system, which was not designed to handle it, into Gnosis which was designed to handle it.
• Relying on Gnosis reporting to keep abreast of what is happening (details below).

Financial Process Flow with Gnosis

This diagram describes the financial system structure with Gnosis in place (click diagram to enlarge).

With this implementation, your accounting system will no longer contain the type of information that you need to understand your donor income flow - this functionality moves to your Donor Management System - Gnosis.  

 

Gnosis Income Reporting

By using Gnosis to track all income, you can report your income using up to 10 different types of categorization and other detail, with virtually endless data output options.

Reporting Income Classifications

1. The Income Account: Mapped to Quickbooks (or any other accounting system).
2. The Income Source: Tracks where the income originated - your website, a third party aggregator, special events by name, or any other source.
3. Campaign: When the income results from a specific campaign or fundraising push.
4. Solicitation Code: Generally used to denote the type of “ask” - for example, Email newsletter, print/mail, local radio, robo-call, etc.
5. Event: If the income is generated from a specific event - for example, event tickets.
6. Solicitation By: The staff person/Gnosis User responsible for the solicitation of the donation.
7. Raised By: The person/other Gnosis record responsible for the solicitation of the donation - for example, gifts solicited by a board or committee member.
8. Tribute Type: Denoted what type of tribute (in honor of, in memory of, etc..) - if any - that donation came in with.
9. Transaction Date: Using a combination of the transaction date and other income class(es), reports for recurring appeals and events are streamlined. This capability allows the elimination of individual accounts/campaigns codes by individual year. For example, instead of using separate codes for Annual Appeal 2017, Annual Appeal 2018, and so on, you can simply use one code, Annual Appeal, with the gift date for necessary reporting.
10. Batch #: Generally used to track individual bank deposits, can also be used to further categorize.

Reporting Data Output Examples

Below are just a few common reporting output examples using a combination of income criteria (examples provided above). Gnosis provides a plethora of standard reports but also offers the capability to craft custom reports. Note the data outputs outlined below are dependent on how income entry is set up and managed. Your Gnosis Support Person will provide the necessary guidance to achieve your desired reporting.

1. Individual donor details by gift date or income class (individual, household, and organization details are available).
2. Quick and easy income totals or donor counts without donor details.
3. Donor giving history, including aggregate amounts and gift counts, most recent gift, and largest gift.
4. Event income breakdown, including tickets, auction, donations, sponsorships, etc.

Efficient, Effective, Auditable Management of Income

Using the above process flow, you can easily achieve significant time savings whilst improving the auditability of your transaction flow.  These are the important ingredients for success:

1. All donor income should be routed through Gnosis as soon as possible.
2. Set up a banking process whereby banking information (banking summary and deposit preparation) is generated either directly from Gnosis or from Quickbooks after posting a batch from Gnosis, and then is used for deposits to ensure that initially recorded income exactly matches deposited amounts. 
• The Gnosis Batch Report is vital in this process.
• Recommended to have one batch per bank deposit.
• Credit card income will be tracked by separate batch, with the cutover matching your statement date/time.
3. Quickbooks integration with Gnosis provides the ability to auto-post from Gnosis to Quickbooks (or for other systems, manually post the totals from each batch report into the accounting system) on a regular basis, completely eliminating the need for double gift entry into two different systems.
4. Monthly, reconcile your system to ensure everything is correct:
   • Gnosis Batch Totals = Bank Deposits = Quickbooks Income
5. File auditable transaction flow documents:
   • Bank Deposits <-> Gnosis Batch Summary Reports
   • Quickbooks <-> Bank Reconciliation
   • Quickbooks <-> Gnosis Batch Totals Reconciliation
6. Your Gnosis Support Person will support you wholly in building and maintaining a successful banking process. 
7. During Gnosis implementation, it is often the case that cleaning up the income history is a viable option, allowing you the capability to review past income in the same looking glass as all future income via Gnosis income reporting. Your Gnosis Support Person will provide guidance in this cleaning process, if necessary.

The Benefits of This Process Flow

1. Excellent Auditability
1. Separation of duties: Database entry and Bookkeeper
2. Clear auditable flow: Incoming Gifts -> Gnosis -> Bank -> GL -> Gnosis Batch Report.
2. Bookkeeping Efficiency
1. Transaction volume in bookkeeping is substantially reduced as all detailed recording is now managed in Gnosis.
2. Gnosis is optimized for speedy donor income management, much of it automated.
3. Gift data becomes immediately available for up to date analysis and does not need to wait for bookkeeping (often part-time) to facilitate the process.
4. Better self-service opportunities for donors to retrieve commitment status, statements, and history on demand.