Although the terms “for-profit” and “nonprofit” call different meanings to mind, Brandon Miller, president and CEO of HW&Co., a CPA and advisory firm with offices in Greater Cleveland and Columbus, quickly dispels that perception.
“Technically, any profits made by nonprofit organizations go back into their mission, and profits from for-profit firms go into the pockets of their owners,” Miller explains. “But, from the financial side, both types need to make money in order to survive. If nonprofits only plan for breaking even, they’re not going to be around for long. They must build a budget of surplus, evaluate the variety of programs and services they offer and focus on the longevity of their organizations.”
Next month, HW&Co. will hold its annual symposium for nonprofits, one way the firm addresses individual needs and offers solutions. Past topics at the conference include ways revenue recognition, contributions and leases change the look of financial statements; understanding tax law changes as they relate to nonprofit reporting requirements; the most effective ways the 990 form can relay an organization’s story; how to effectively plan for a transition and identify the next leader; and the state of giving. This year’s half-day event will be offered both in person and virtually and feature financial, executive and general sessions. The date is Sept. 28 at the Holiday Inn on Rockside.
Serving clients in sectors that include arts and culture, social service, health care, behavioral health and foundations, HW&Co. is dedicated to developing creative solutions tailor-made to help clients achieve their specific goals.
Miller’s affiliation with his company began more than 20 years ago when he landed a tax internship at the firm while earning his BSBA in accounting at John Carroll University. The 204th largest accounting firm in the U.S., HW&Co. serves a diverse client base that includes domestic and international privately held and family-owned for-profit and nonprofit businesses and individuals. Earlier this year, Miller was named to the Cleveland 500, the annual accolade that honors 500 of the most powerful and influential leaders in the city.
Through its affiliation with PrimeGlobal, an association of independent accounting firms, HW&Co. has access to international resources that assist clients with accounting, tax and consulting services around the globe.
“We pride ourselves on really understanding what each organization is about and becoming emotionally invested in it,” Miller says. “As advisors, we understand what the mission is and the successes that can result. That outcome leads to clients who are very happy to work with us.”
Miller adds that COVID-19 has led to new challenges that are imperative to address.
“To understand how the pandemic has affected the nonprofit sector, you must break it down by industry,” he says. “Some, like arts and culture and social service organizations that rely on interaction with people, have been hardest hit. Others, such as telehealth services, have not — which is why different situations call for different strategies.”
“In the nonprofit world, just because you provide a superlative service doesn’t mean you can charge top dollar,” says HW&Co. senior manager Helen Weeber, who also directs the firm’s Nonprofit Advisors Group. “In addition to being ethically above everyone else, nonprofits have confines they need to work in, including being the steward of the dollars they are receiving and attracting top talent.”
Weeber, who serves as an accountant and consultant for nonprofit and health care organizations, specializes in operational, strategic planning and reimbursement consulting for skilled nursing facilities, home-health agencies and community-based service providers.
Another big challenge, she adds, is nurturing the donor relations that are pivotal keys to success.
“Whether the donation is from a corporation, foundation or an individual, a thank you and follow-up detailing what the money will be used for must be issued, and that takes time,” she says.
The fact that most donors want their dollars to fund programming — not overhead — adds to the conundrum.
“If a nonprofit’s books and records are not in good shape, and there’s all sorts of problems with accounting, you know that will be front-page news,” Weeber says. “However no one wants their donation to be used for overhead costs.”
HW&Co. Director of Tax Services and CPA David Reape attests that the past year has been particularly perplexing. One paramount concern occurred when organizations that were suddenly forced to work remotely quickly realized they didn’t have the infrastructure, cyber security and technology needed to thoroughly protect their assets.
Reape, who prepares and reviews tax returns for social service agencies, religious organizations, museums, labor unions and private foundations, understands the issues nonprofits face and strives to make workable recommendations to improve operating efficiency for his clients — including those working with limited resources. He’s also developed and presented tax seminars about nonprofit organizations, S-corporations and SALT (State and Local Tax) issues for the Ohio Society of Certified Public Accountants. Areas of expertise include the impact of tax reform on exempt organizations, IRS views of governance, tax issues for nonprofits and Ohio tax reform.
“Now everyone is suddenly more comfortable online,” Reape says, “so organizations are looking at creating a blended method in which some of their services will be provided virtually as opposed to being provided totally in person.”
That philosophy will be championed by a staff that appreciates the benefits of working remotely from home.
“Just like all of us need to do, it’s time for organizations to take a close look at what they’re trying to accomplish,” Reape says. “That’s a necessary step that must be taken to survive in the new world we’re living in.”
Weeber champions that effort.
“I think there’s something beautiful in the fact that nonprofits want to make the world we live in better than the way we found it,” she says.
Visit hwco.com for more information about HW&Co.’s September symposium.