Monthly Bookkeeping Checklist for Nonprofits: Stay Organized, Transparent, and Audit-Ready
- rebekaheliasllc
- Oct 26
- 3 min read
Hello its your Bookkeeper Rebekah! Starting a new series on Non Profits to share with all of my followers! For many nonprofit leaders, managing finances can feel overwhelming — between donations, grants, and reporting requirements, it’s easy for things to slip through the cracks. That’s why having a monthly bookkeeping checklist for nonprofits is so valuable.
Consistent bookkeeping keeps your organization compliant, transparent, and financially strong. Whether you’re a small nonprofit, faith-based organization, or grant-funded charity, following a clear monthly process ensures your books are accurate and your mission stays on track.
Step-by-Step Monthly Bookkeeping Checklist for Nonprofits
1. Reconcile All Bank and Credit Card Accounts
At the end of each month, reconcile your:
Checking and savings accounts
Credit cards
Donation platforms (like PayPal, Stripe, or Venmo)
Your nonprofit accounting software should match your bank statements exactly. Regular reconciliation catches duplicate entries, missing deposits, and potential fraud early.
Pro Tip: Use tools like QuickBooks Online for Nonprofits, Aplos, or Wave to automate reconciliation and save time.
2. Record and Categorize Donations
Nonprofits receive income from diverse sources — grants, fundraisers, recurring donors, and events. Each transaction should be:
Accurately recorded in your accounting system
Categorized by fund and restriction type (restricted vs. unrestricted)
Linked to the correct donor in your CRM
Tracking restricted funds correctly ensures fund accounting compliance and builds donor trust.
3. Review Accounts Payable and Receivable
Every month, review all outstanding bills and expected income:
Pay vendors promptly and confirm all invoices are coded correctly.
Follow up on unpaid grants or pledges.
Confirm staff reimbursements have supporting documentation.
Consistent review of nonprofit accounts payable and receivable improves cash flow visibility and accountability.
4. Verify Payroll and Staff Expenses
If your nonprofit has employees, double-check that:
Payroll is posted accurately and on time.
Payroll taxes and benefits are correctly withheld.
Staff reimbursements are categorized by program or department.
Keep records of volunteer stipends and mileage reimbursements to ensure IRS compliance.
5. Review Budget vs. Actual Reports
Generate a monthly nonprofit financial report comparing your actual income and expenses to your approved budget. Share it with your board or finance committee to discuss:
Spending variances
Revenue shortfalls
Opportunities to reallocate funds
This monthly financial review ensures responsible stewardship of donor dollars.
6. Organize and File Supporting Documentation
Maintain organized, digital copies of:
Bank and credit card statements
Donation receipts and acknowledgment letters
Vendor invoices and contracts
Grant award letters and expense reports
A clean filing system simplifies audit preparation and grant reporting — and protects your organization in case of review.
7. Back Up Your Financial Data
Protect your financial information by backing up your accounting files every month. Use secure cloud storage and an external drive for redundancy.
8. Prepare a Monthly Financial Summary
End the month with a short nonprofit financial summary for your leadership team that highlights:
Total income and expenses
Current cash balance
Outstanding liabilities
Key budget variances
Sharing this regularly builds transparency and board confidence in your organization’s financial health.
Why a Monthly Bookkeeping Routine Matters
Bookkeeping for nonprofits isn’t just about numbers — it’s about trust, compliance, and mission impact. When your books are current, you can:
Make informed financial decisions
Report accurately to donors and grantors
Simplify your annual audit
Demonstrate transparency and good governance
A well-maintained nonprofit bookkeeping checklist helps ensure every dollar is accounted for — and every program is funded responsibly.
Simplify Your Nonprofit Accounting
If you’re struggling to keep up with monthly bookkeeping tasks, consider:
Creating a shared Google Sheet or project management checklist- download ours below to get started!
Automating data imports in your accounting software
Partnering with a nonprofit bookkeeping specialist who understands fund accounting and compliance requirements such as Your Bookkeeper Rebekah who is always here to help with your nonprofits!
Final Thought
Consistent bookkeeping is one of the best ways to strengthen your nonprofit’s foundation. By following this monthly bookkeeping checklist, you’ll stay audit-ready, donor-ready, and mission-ready — every month of the year.
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