Who handles the gift processing?

Jolynn Uyehara

Hi friends. We are a PreK-12 school with a little over 1000 students. Our Advancement department is a small team in comparison to the larger schools here. I am the Database & Stewardship Specialist which basically means I handle anything to do with RENXT and also help in other areas as needed. I have heard from several others that the gift entry is not done in Advancement, but in finance. I wanted to reach out to ask how many of you do the gift entries that are in Advancement vs those in Finance. When I first started 10 years ago with the school, I started in the business office (finance) in accounts receivable and that job did the gift processing. So when I moved to Advancement and tried to leave it in finance, it followed me so I still do the gift entries. While I don't mind doing it, I wanted to reach out to ask if this is normal practice or do most of you process your gifts through the finance dept?

Emmet O'Conlon

@Jolynn Uyehara
Advancement, and in previous places I've worked as well. I believe it's about having proper checks and balances, and that the database work, whose skill set may be aligned with finance, is nonetheless fundraising work.

Sunshine Reinken Watson

@Jolynn Uyehara It is best to have gift entry done in the advancement office to maintain a separation of duties. I would check with your auditors on any potential move.

Another concern is making sure the gifts are properly recorded and coded for fundraising in the donor database. The finance department may not be concerned with the same details that the advancement office takes very seriously.

Laura Vaughan

@Jolynn Uyehara I've seen it in both areas as well, but most frequently with Advancement. I agree with the other respondent that it helps create appropriate segregation of duties. As someone on the Finance side who recently had gift processing added to my team, I can add that there are pros and cons to either way, but I find it challenging to manage the differing goals and reporting requirements of both teams.

Irene Hui

@Jolynn Uyehara In my experience, it has been handled by advancement. Things are looked at differently by each department. I agree with @Sunshine Reinken Watson about having it done in advancement ensures that the gifts are properly recorded and coded in the fundraising database.

Alex Wong

@Jolynn Uyehara
I think it depends on your org and resource available.

for our org, we have 25 chapters including the HQ department, we used to have each chapter “development associate” (you can think of them as “half fundraiser support and half administrative” entry their own gift. Later on finance department wants to standardize and make it a finance department operation for all gift entry (and the actual charging of cc and deposit of checks).

There are pros and cons in both

Dariel Dixon

It's not a matter of who handles it, but how the resources are allocated @Jolynn Uyehara. Obviously it's a full time job and to be honest, I'm not sure it matters as long as all of the pertinent data gets entered into the database. Asking the question here will probably get you a very biased answers, but the key is good communication between both finance and advancement.

But the answer is really about where the budget is for the role. There needs to be an representative for the process in both department.

Dan Snyder

@Sunshine Reinken Watson:

@Jolynn Uyehara It is best to have gift entry done in the advancement office to maintain a separation of duties. I would check with your auditors on any potential move.

Another concern is making sure the gifts are properly recorded and coded for fundraising in the donor database. The finance department may not be concerned with the same details that the advancement office takes very seriously.

+1 for @Sunshine Reinken Watson's answer

Miki Martin

@Jolynn Uyehara my last org was a private, all girls high school where we had a very small Advancement Department. I was the Database Specialist and handled everything to do with RE NXT, including all gift processing and acknowledging. I reconciled monthly with Finance to be sure all the funds and campaign dollars matched. I think @Dan Snyder brings a very valid point. While many of us in Advancement typically process gifts since they're donations it isn't necessarily the only way. I also agree with @Sunshine Reinken Watson.

Naila Asif

@Jolynn Uyehara

Hi, In order to maintain separation of duties it is utmost importance that data entry is done in advancement and deposited in the bank by finance. Advancement is concerned more about the accurate entry in RE in regards to appeals and campaigns. Finance is mostly concerned with the funds that they are mainly monitoring. For auditing purposes as well, it is important that person who is opening the mail (checks, cash and cc donations) should handover the financials to finance department for bank deposit and have a second set of eyes.

Rachel Kauer

@Jolynn Uyehara
Hi Jolynn,

In both of my organizations gift processing was handled by Advancement. Whether it was in a team of 2 or 10, Gift Processing and Accounts Receivable were always distinct roles.

Gift processing touches data entry and stewardship, going beyond entering transactions and requiring an acute understanding of donor intent, Advancement policies and the whole stewardship process. However their scope pretty much ends at the stage where the general ledger bits need to happen, other than reconciling any discrepancies with accounts receivable.

Gifts processors and accounts receivable should be working closely together to and it's important to define one ends and the other begins, because accounts receivable needs to be doing the parts that involve the general ledger and the orgs accounting system. Below is a great sample of the way in which the roles, databases and reporting should generally interact.

I have also included my orgs overview of the gift process after the excerpt for reference in case there is anything to it you find helpful.

The table below outlines a few of the distinctions between gift processing and finance:

	Gift Processing	Finance
Roles	Ensures donations are entered in a timely manner into the fundraising database. Oversees the accuracy of individual donor records and is concerned with a positive gifting experience. Generates donor receipts per IRS standards.	Reconciles the information entered by gift processing to balance the organization’s general ledger. Oversees the financial health of the entire organization. Audits the organization’s accounts receivable and payable.
Database	Utilizes the fundraising database to record transactions and donor information. Records transaction-level information.	Utilizes financial accounting software which may include general ledger, payroll, and balance functionalities. May record transaction-level information or balance at the department or fund levels.
Reporting	Follows IRS guidance as well as industry standards, usually defined by CASE (Council for the Advancement and Support of Education) or AHP (Association of Healthcare Professionals).	Follows standard accounting principles, usually defined by GAAP (Generally Accepted Accounting Principles).

Transfer of Data Between Gift Processing and Finance

Gift processing and financial systems have a standardized process for communicating with each other, typically referred to as the general ledger transfer process. Many fundraising databases come with built-in functionality to facilitate this crosstalk between the fundraising and financial systems. This crosstalk may take the place of a periodic batch transfer of data, or may be fully automated, depending upon available technology.

Communication Between Gift Processing and Finance

Many nonprofit organizations struggle with communication between gift processing and finance departments. Often these issues stem from a lack of understanding regarding the roles outlined above or from technical issues. Almost always, however, these issues can be resolved through a facilitated understanding of each department’s overall goals and technical needs.

I have included a copy of our orgs “gift process.” Our Raiser's Edge is integrated with Financial Edge, which of course effects this process. But I swear our reconciliations is so simple! I pretty much hand just accounts receivable a few reports after a batch and at month's end usually the only words we exchange is, “Everything matched up, good to go.”

If you are finding that you are feeling overwhelmed with gift processing and the database management, I highly urge you to encourage your org to go for integration. It took hours at my first org to do manually, but with my second org being integrated, it is effortless.

The Gift Process:

The Gift Processor scans and processes all incoming gifts and associated paperwork and then enters those gifts into Raiser’s Edge in a Batch. It is Trinity Pawling School’s protocol that all gifts are entered in batch, with the exception of certain types of gifts such as stock. After the Gift Processor creates a Batch, that Batch is reviewed by the Advancement Director to confirm allocation of gifts to funds and other details. Once a Batch is approved by the Advancement Director that Batch is committed by the Gift Processor and the data prepares to move from Raiser’s Edge to Financial Edge. The Gift Processor then submits Batch Reports and any checks/cash to the Business Office.

The Business Office then runs a Pre-Posting Report to review the batch to make sure it will post correctly to their GL accounts and then GL-Posts the Batch, which moves the data from Raiser’s Edge to Financial Edge. The Chief Operating Officer then reviews the GL-Posting. The Business Office then returns the GL-Posting Report to the Gift Processor.

The Gift Processor keeps that report in the GL-Posting Report Binder in the Gift Processing Office, scans a copy of the completed batch into the drive and files the original paperwork in the Gift Processing Office Filing Cabinet.

The Gift Processor then generates Acknowledgement Letters which are reviewed and signed by the Advancement Director. The Gift Processor also works closely with the Advancement Manger to communicate the need for custom acknowledgement letters on donors who fit the criteria. These too are reviewed and signed by the Advancement Director. The Gift Processor then scans the signed letters into the drive and mails out the Acknowledgement Letters to the donors.

In the event the Gift Processor is out of the office, their processes are backed up by the Prospect Research Manager.

Dariel Dixon

@Rachel Kauer This is a great resource. It really signifies the difference in perspective of AR and Advancement. I think that moving you and your gift processing duties to the advancement office was a correction that was made by management @Jolynn Uyehara. Is there any conversation about making a change?

Austen Brown

@Jolynn Uyehara - Agree with all that's been said. In my experience, gift entry is done in Advancement. Reconciliation occurs monthly to ensure both Development and Finance systems match.