Financial controls are actually a subset of internal controls and typically refer to segregation of duties. The right financial controls ensure that the person entering invoices to be paid, for example, is not also able to mark the checks for payment or cut the checks without someone else’s involvement in the process. It is important that such processes are in place throughout a diocese, however, this becomes challenging in smaller parishes where there is only a part-time bookkeeper using a manual or moderately automated system. The financial controls need to be documented and monitored, especially if using a manual method. A computerized application through which these “duties” can be limited and the controls enforced with the system security, therefore, is an ideal solution. Dioceses might examine the economies of scale created by centralizing processes and – if possible – provide access for smaller parishes to computerized solutions that they may not be able to afford on their own.

Faced with the ultimate responsibility of the entire diocese, such a financial control system needs to possess certain attributes to ensure fiscal needs are met. Requirements for an enterprise-wide solution include:

• Effective and efficient processes – System should eliminate duplicate entry; automate manual processes; provide economies of scale; provide services from within the diocese finance department to all areas of the diocese (e.g., payroll). Investment is best in an application that can be rolled out and phased in over time to provide a costeffective solution with economies of scale. A vertically focused solution embedded within a leading mid-market application platform adds tremendous value, because it is
designed to be scalable to serve diverse needs while providing a set of industry-specific functionality (e.g. chart of accounts structure and adherence to key financial reporting standards).

• Reliable financial statements and accounting records – Software should provide a strong audit trail and reporting tools that enable easy ad-hoc as well as management-style report generation.

• Safeguard assets – A solution should provide the tools to manage investments and revolving loan funds as well as physical (fixed) assets; offer an audit trail and the ability to enforce financial controls.

• Adherence to management policy and procedures – System should, again, provide an audit trail and financial controls, as well as automated workflow and business rules to help prove that mandated procedures are being followed.

Check back next week as we discuss some of the benefits for Dioceses.

Access the “Achieving Financial Transparency for Dioceses” FREE whitepaper.

We’re excited to announce the expansion of our Serenic Navigator Online (NOL) product suite, which is now available in three offerings:

• Serenic NOL Basic
• Serenic NOL BE (Business Essentials)
• Serenic NOL AM (Advanced Management)

Serenic NOL is a Software as a Service (SaaS) version of our award-winning Navigator financial management system. The cloud-based subscription model leverages Internet streaming functionality with access to Serenic’s financial management software for the term of the subscription. The Serenic NOL product features are designed to meet specific needs of nonprofit and public sector organizations, which are increasingly connecting to the Internet to automate and simplify business processes “in the cloud.”

“Serenic Navigator Online offers NGOs and nonprofits financial management functionality coupled with the advantages of a decentralized software deployment model,” according to our CEO and President Randy Keith. “Organizations with multiple offices, remote workers and distributed workforces especially benefit from using a cloud-based solution. If their situation changes for any reason, NOL clients can easily and cost-effectively transition to the on-premise version of the Serenic Navigator financial management suite.”

NGOs and nonprofit organizations can download the Serenic Navigator Online Success Kit or informative white paper for more information.

Over the past few years especially, reports of financial scandals within the Catholic Church have flooded the media and prompted
new recommendations from church governing bodies. A widely publicized 2006 survey by researchers at Villanova University found
that 85 percent of Roman Catholic dioceses that responded had discovered embezzlement of church money in the last five years, with
11 percent reporting that more than $500,000 had been stolen.

The USCCB Accounting Practices Committee (APC) concluded that “the vast majority of the aforementioned frauds appear to be occurring at the parish level. At the APC meeting in January 2007, this topic was thoroughly studied and several recommendations were made to enhance the financial governance in the 19,000+ parishes.”  The group’s Accounting Report recommended the use of
the Financial Accounting Standards Board (FASB) standard financial presentation.

Previously in 1995, the United States Conference of Catholic Bishops (USCCB) created the Diocesan Internal Controls, making the Bishop
effectively responsible for the entire diocese. The forward stated that “all administrators are to perform their duties with the diligence of a good householder. The bishop can delegate the authority but not the responsibility. He has the duty to ensure that no abuses exist in the administration of church goods within the diocese.”

The Villanova study suggested that whether an organization is a Fortune 500 company or a diocese, the objectives of the internal control structure remain the same (2):
1. Provide reliable financial statements and accounting records
2. Safeguard the entity’s assets
3. Promote operational efficiency and effectiveness
4. Promote adherence to the mission of the Church or organization

Check back next week as we discuss the requirements of a financial management system.

Access the “Achieving Financial Transparency for Dioceses” FREE whitepaper.

Serenic recently sponsored a nonprofit accounting special report in The NonProfit Times titled, “Accounting Software – Audits and lawsuits and floods, oh my!”  We were pleased to sponsor the article and also provide some good insight into the importance of robust fund accounting software in today’s financial world.  As many know, accounting software is essential to the daily operations  of any nonprofit where audit trails, reporting and transparency are a must have.

In the report you’ll see our own David Abel, VP of client services, state the following:  “Clients often perceive adding document imaging to the procurement process as being cumbersome and electronic approvals as creating bottlenecks.  However, an automated system, implemented properly, will provide benefits that substantially outweigh the added steps. Without these tools, it is easier to lose the audit trail and avoid the approval chain since manual processes can be easily circumvented.”

Also included are wise tips from our CFO, Paul Johnston, “Ignoring due dates can be a total disaster, or thinking that you’re prepared but not checking and reviewing, having working papers that are poorly constructed, can cause problems and drive up your audit cost.”

And as Paul also points out, motivating your staff to use the tools correctly is vital.  “If you’ve got a dismissive attitude toward the audit or toward your backup plan you will have problems. If you have a good attitude you’re going to save money and time and the process will go more smoothly,” said Johnston.

Be sure to check out the full article which reminds us all, “Accurate financials are the cornerstone of a well run nonprofit.”

For all organizations in the nonprofit sector, financial transparency is synonymous with survival. Dependence on donors necessitates an ongoing demonstration of where money is spent and how funded activities and programs fulfill defined mission statements. While Catholic dioceses are not required by law to be transparent and accountable, there is a definite shift towards the production of financial reports that provide a complete picture of the financial health of the entire diocese from the bishop’s and archbishop’s office down to the parishioner donor level.

Recent events have emphasized the importance of financial transparency. From embezzled funds to extortion, indictments have been handed down within the Catholic Church and a strong case has been built for not only increased scrutiny, but for better safeguarding of a diocese’s assets.

Like any nonprofit group that constantly works to do more with less money and resources, it can be a daunting challenge for dioceses to provide a more holistic financial view of multiple, complex layers of the organizations in their areas of service. From schools and parishes to cemeteries, there exists a strong need for the chancery office to help each operating center succeed without adding a huge burden to its own management responsibilities.

Challenges at the organizational level include Catholic schools facing increased operational costs and a market in which many families cannot afford the expense of private schools. Nonprofits, in general, today are faced with declining donations in an uncertain economy.

Check back next week as we discuss the increased need for financial controls.

Access the “Achieving Financial Transparency for Dioceses” FREE whitepaper.

I’ve been working with Medair for the last couple of months on the requirements gathering, planning, and remote training sessions so we can implement Serenic AwardVision (nonprofit grants management) and Serenic Fixed Assets.  Both are replacing manual processes and providing the NGO with streamlined reporting.

Medair was previously tracking grants in Microsoft Excel or Word documents and entering them as funds into Serenic Navigator.  This process has been a bit challenging for the finance department and the grant writers with respect to reporting and tracking the status of the grants, etc.  In addition to the challenges with reporting, Medair was manually processing the admin booking (indirect costs) and revenue recognition each quarter.  During our onsite visit in Switzerland, we wrapped up setup items and procedures and provided training to the project team, finance staff, grant writers and International Operations.  The team is very enthused to now have the ability to maintain the grants and reporting all in one system, with visibility into the status of expenses, recognized revenue, indirect cost and the many other data tracking methods available.

We also met with the finance staff and logistics department on management of the assets.  This is a manual tracking process (asset master record information, depreciation and disposals) that has been rather cumbersome for the team, especially with getting field office asset changes back to HQ or logistics.  Along with the Medair staff, we set forth the requirements to implement the Serenic Fixed Assets granule in February.

During my onsite visit, I was able tour the beautiful city of Lausanne, the second largest city on Lake Geneva and the location of the headquarters of the International Olympic Committee.  I experienced hot wine, real French crepes, authentic Swiss fondue and, of course, Swiss chocolates!  I probably gained about 5 lbs from over-indulging in the cheese and chocolates J.  Geert from Medair showed me some museums and the beautiful Lausanne Cathedral (originally built in the 12^th century), on his day off…how sweet!  The Medair finance department also invited me to experience a traditional Swiss dinner with raclette cheese, smoked meat and potatoes.   Thomas made a killer tiramisu (I know, this is Italian instead of French, but it was too good to leave out)!  The hospitality of the Medair team was incredible!

Of course, I had to add some excitement to the visit by setting a bowl of potato chips on fire, during apero (sort of like a happy hour/gathering).  Luckily, the Medair staff was well equipped with fire safety training to stomp it out. I was grateful nothing was damaged and nobody was hurt.  The Medair staff got a good laugh and snapped pictures during the fiasco (which I am not posting)!

All in all, it was a great visit and we made some major progress with the project.

Quiana Willard, Senior Application Consultant

We’re excited to announce Rye Barcott as the keynote speaker for our next accounting software user conference.  Rye brings varying experiences from working with nonprofits, serving as a Marine, and authoring a new book.  We look forward to him sharing his story and hope his mission to spark change from within will inspire our nonprofit and NGO accounting software users.

It Happened on the Way to War, a Marine’s Path to Peace, recently authored by Rye, tells how his NGO, Carolina for Kibera (CFK), was started with the help of two local people.  Kibera is a slum in Nairobi, Kenya, where Rey spent part of a summer living in ten-by-ten-foot shacks, learning Swahili, and listening to stories of survival amidst poverty.  Friendships in the slum turned into the creation of their inspiring NGO.

Rye served in the U.S. Marine Corps for five years in Iraq, Bosnia, and the Horn of Africa, and then earned a master’s degrees in business and public administration from Harvard University.  He was recently named to the World Economic Forum’s Class of Young Global Leaders, along with other notable young leaders like Leonardo DiCaprio, and Mark Zuckerberg.

According to Rye, “Talent is universal; opportunity is not.”

We’re really looking forward to this opportunity to meet Rye and to hear more about his experiences!

(Follow Rye on Twitter)

The Government of the Republic of Malawi

The Malawi Government moved to a decentralized model through 40 Local Assemblies across the country created to enhance service delivery for education, health, agriculture and other areas.  The central government office needed to help its local authorities become more accountable and overcome the challenges of a financial management system based on manual operations that lacked standardization and created multiple problems with budget execution and implementation.  The Malawi Government implemented Serenic Navigator Advanced Management Edition – certified for Microsoft Dynamics NAV for 300 trained users across the country. The features that helped them benefit include:

• Configured system to meet government requirements.
• Streamlined financial reporting, accuracy in revenue collection and reconciliation and expenditure control.
• Organizational improvements such as improved efficiencies avoided process delays and decreased costs.
• Revenue and property billing was automated and collection efficiency improved.

Please join us in welcoming James Romero back to Serenic.  James is returning to lead our Channel Sales operation for North America.  He was previously instrumental in launching the business development function here at Serenic, has managed two small businesses, and most recently, provided solution sales training for field personnel at Microsoft.  While consulting for Microsoft, he travelled to over 35 countries including Russia, the UK, Africa, the Middle East, Asia and Latin America.

James loves the great outdoors here in Colorado (hiking, snowboarding, skiing and biking).  When not working or spending time with family, he coaches youth baseball, loves reading and playing music, and watching the Denver Broncos and Colorado Rockies.

We look forward to working with James again and the leadership he will bring for our Serenic Navigator partners.

For many people, the holidays can be the most difficult time of the year. We find donating is a great way to give back to our community and share the joy of the holidays with those in need!  We would like to highlight two great charities that members of the Serenic team have donated to this holiday season.

Gifts of Joy Drive for MHCD:

Every year the Mental Health Center of Denver (MHCD) conducts a Gifts of Joy drive to make the holiday season brighter for the children, adolescents and adults they serve.  We were excited to participate in the toy drive this year.  MHCD is a local nonprofit that serves the Denver community and individuals struggling with mental health and substance abuse challenges. For many of the children, the only toy they will receive will be one from the Gifts of Joy drive.

We were happy to pack up several items that the children said they would like.  These are all toys we can relate to!

• toy cars and action figures
• barbie dolls and baby dolls
• numerous stuffed animals
• nail polish and make-up kits
• puzzles, games and books

For adults and at-risk youth living on the streets, we also donated gift cards to a local grocery store, King Soopers.

Coats for Colorado:

Prior to the toy drive, Nancy organized an in-office coat drive for Coats for Colorado, which is sponsored by Dependable Cleaners and Denver News Channel 7 (KMGH-TV). This past cold snap has reminded us that Colorado winters can be freezing, leaving many people, young and old, that are in need of winter coats.  This charity drive has been helping people of Colorado for over 29 years.