Best Practices: Cloud Computing for Associations

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Best Practices: Cloud Computing for

Associations

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What You Should Expect from this Session

A solid understanding of cloud computing and Software as a Service

Best practices for how cloud computing is being used by association

finance

What to do to get ready for 2011 (including how to negotiate, avoid

pitfalls and get the best deals)

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About LarsonAllen

LarsonAllen

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_{Top 15 National CPA firm}

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_{1,800 people and growing}

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_{Serve clients in a wide variety of industries with a}

significant association client base

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_{Provide a full array of financial services}

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_{3,500+ not-for-profit clients}

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_{Began using Cloud Computing in 2001 – Early Adopter}

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_{Significant number of clients using Cloud Computing}

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_{Cloud solutions are preferred option for handling client}

outsourced accounting services

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About Intacct

The Cloud Financial Management Company

Fastest growing of any financial

management and accounting vendor

− 4,000+ customers

Preferred provider of financial

applications for the AICPA

Best awards and recognition

Most experience and innovation

Exceptional service and operations

− 99.99% availability for the year

Record client satisfaction

− 9 out of 10 clients recommend Intacct

Fastest time to value, highest ROI

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Some of the associations working with Intacct and

LarsonAllen

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Agenda

Cloud Computing Defined

Why Cloud Computing for

Association Finance?

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The Cloud Impacts All of Us Both as

Consumers and in Business

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And Now Also for Your Business Applications

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Software as a Service – Run your Business

Applications in the Cloud

Cloud computing is a broad term

encompassing everything from B2C

services to infrastructure

Software as a Service is a subset of

cloud computing focused on

enterprise business applications

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_{Mature, high function applications}

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_{Flexible to configure and integrate}

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_{World class operations and}

maintenance

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_{Support and service level agreements}

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_{Vastly better economics}

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Key Cloud Computing Drivers

1. More cost effective / Higher ROI than

other alternatives

2. Anytime / anywhere access 3. Have limited IT resources

4. Faster time to deployment / faster time to value / less risk

5. Easier and less expensive to

customize / more flexible / more open 6. Positive experiences with other

cloud-based products

7. Better security & operations than you can otherwise afford

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Top Concerns about Cloud Computing

(64% of these respondents now have strategy to prefer Cloud)

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Security, Infrastructure & Operations

Cloud Vendors Have Superior Operating Capabilities

Far better than nearly all not for

profits can afford to deploy

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_{IBM Fortune 100 class data center}

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_{Encryption & hardened systems}

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24x7x365 operations on three

continents

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_{SunGard disaster recovery center}

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_{Redundant hardware and}

networking

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_{Continuous backups}

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Automatic upgrades

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_{SAS 70 type II audited}

Possible because costs are spread

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Agenda

Cloud Computing Defined

Why Cloud Computing for

Association Finance?

Tips for Negotiating and

Getting the Best Deals

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State of Current Financial Solutions

Effectiveness Gap

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The Impact of Cloud Computing on Financials

Closing the Effectiveness Gap

Source: Saugatuck Technology, Cloud Financials Come of Age, 2008

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Traditional Options

NFP Software Suites • Expensive to implement,

operate, administer, upgrade • Requires expensive IT resources • Often requires 3rd_{party add on}

reporting tools

• No real time business visibility • No easy way to create and

distribute reports to internal and external stakeholders

Quickbooks • Inflexible General Ledger • Over-reliance on Excel for

financial and management reports

• Weak internal controls with minimal or no audit trail for transactions

• No workflow capabilities • Limited ability to scale users

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Why Not Cloud for Finance?

Many Associations already use cloud

applications for important elements of their

business…..

Payroll

Membership

Fundraising

Bill payment

Banking

Events

Moving to cloud for Financials is a logical next

step…. And it is happening quickly

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Accounting and Compliance Challenges for

Association Finance

Accounting Challenges •Revenue Recognition •Allocations, Programs •Internal Controls

•Cash Flow Mgmt/Budgeting •Custom and ad-hoc reporting •Integration w/AMS systems

Finance Deliverables •Internal reporting •External & Board reporting •Budgeting/forecasting •Stewardship of funds •Timely closing-the-books •Audit & compliance

Manually Intensive Processes

IT not a core competency

Accounting regulations

A-133 Compliance

Heavy Dependency on MS Excel

Manual / Offline Reporting

Weak Internal Controls/Fraud

Wasted time and money

Volunteers / Part time workers

Automated member billing and collections

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Cloud Financials Delivers Real Business

Advantages to Association Finance

Achieve anytime, anywhere accessibility

Access to real-time information is becoming

“expected”

Improved internal controls/work flows that result

in gained efficiencies

Enable proper stewardship of funds

Focus is on members – NOT running an IT

department!

Better integration

Lower total cost of ownership – only pay for what

you need when you need it

Automation of revenue recognition and

automated billing - with less Excel

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Advantages (continued)

Program managers are demanding faster

access to real-time information

Movement towards a paperless office is

gaining momentum – Cloud solutions can

help make it happen faster

More employees working remotely –

Cloud can facilitate

Continuous upgrades

No large up front cost for purchase

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Real-Time Financial & Operational Reporting

Accurate Reporting & Business Visibility for all Key Stakeholders

Real-Time,

consistent

information in the

Cloud for all

Stakeholders

Officers, board

members and other

Stakeholders can

receive reports,

perform approvals

and have

role-based dashboards

Management by

KPI’s

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Example of Cloud Financials for Associations:

Web-based Workflow and Controls

Ensure compliance, reduce costs and risk

• Safely engage all employees and volunteers in financial processes

• Real-time visibility plus financial control

• Multiple levels of approvals

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Sharing, securely: Cloud

computing lets you securely

share information with your

CPA firm advisors and auditors

in real-time

Cost savings: reduce audit

fees via reduced site visits

Better advice: resulting from

real-time information,

dashboards and analyses

Another alternative: Cloud

financials can enable cost

effective financial

department outsourcing

Collaborate with your CPA firm

Save money and work more efficiently with your CPA firm

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Avoid mistakes and

wasted time with

disconnected systems

Member management

Donor management

Finance / accounting

Event management

Bill payment

Payroll

Fixed assets

Integrate your key systems

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Example – Member Management integrated with

Financials

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Summary - Associations are Realizing Significant

Benefits

Automate key processes and eliminate manual workarounds

by

leveraging workflow, automation and web services

Increase workforce productivity -

by reducing travel time,

automating expense management and procurement

Slash time spent enabling compliance / governance –

through

improved visibility and reporting

Free up time of staff accountant

by making processes more

paperless and efficient

Reduced IT costs - eliminate overhead and capital expense

of

managing and operating software, hardware and networking

Program Managers get better information more quickly –

real-time access to data utilizing dashboards

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You Still Have to do Your Homework:

Needs Analysis & ROI

Understand your organization’s needs

• Quantify the needs (what are your pains & problems) • Analyze those needs

• Evaluate how best to address those needs

Determine the ROI of any changes

• Associations are very much like living organisms; they are constantly evolving and changing

• Requirements of your funding sources evolve and change as well; how quickly are you able to respond

• Calculate your ROI based on:

• Achievement of a specific goal or problem solved • Improved productivity & automation of manual processes • Increased speed of transaction processing

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Agenda

Cloud Computing Defined

Why Cloud Computing for

Association Finance?

Tips for Negotiating and

Getting the Best Deals

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What’s Different in the Cloud

There is More to Evaluate

Product fit

Implementation success

Support quality

+

Operational track record

Infrastructure and security

Ongoing business practices / culture

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Key Insight – Service Level Agreement to

Mitigate Trust and Risk Concerns

Which cloud features provide higher or lower value vs. on-premises?

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Service Level Agreements

Key to creating a successful

ongoing relationship with your

vendor

Sets expectations and guarantees

performance for how your system

is operated

Recognizes both concerns and

advantages of cloud computing

Vital tool to reduce risk and

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Service Level Transparency

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Expect Significant Benefits

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Apples to Apples TCO

On-Premises Software vs. Cloud Computing

Cloud Computing

On-Premises

• Apply Fixes, Patches, Upgrade • Downtime • Performance tuning • Rewrite customizations • Rewrite integrations • Upgrade dependent applications • Subscription fee • Training • Configuration • Ongoing burden on IT • Maintain/upgrade hardware • Maintain/upgrade network • Maintain/upgrade security • Maintain/upgrade database