Consultant: Financial Systems Review for Nonprofit Growth and Compliance

Request for Proposal (RFP)

1. Background

RRG is the central hub for financial oversight and consolidated reporting across RRI’s various activities and international offices.

In 2025, RRI plans to transition CLARIFI, a regranting mechanism, into an independent 501(c)(3) subsidiary, further expanding its multi-entity structure and introducing additional financial and compliance complexities.

RRI seeks to transition to a cloud-based financial system capable of managing multi-entity, multi-currency, and project-based reporting, in addition to enhancing the organization’s internal financial and accounting processes.

In addition to financial systems, RRI has manual processes and databases for grants management, donor management, and HR operations. While the primary focus of this review is on the financial system, the consultant should also consider opportunities to integrate or improve these processes where they intersect with financial operations.

1. Objective

actuals presentation for the Board, and the financial and compliance management requirements for CLARIFI’s transition to a 501(c)(3) structure. The consultant will also review current staff capacity related to the financial management and system transition and provide recommendations for any adjustments or improvements.

1. Scope of Work

The consultant will conduct a comprehensive assessment of RRI’s financial system needs, internal controls, staffing, and readiness for CLARIFI’s 501(c)(3) status. The scope will cover:

1. System Needs Assessment for Multi-Entity, Multi-Currency, and Project Management:

• Define System Requirements: Develop a detailed set of requirements for a cloud-based financial management system that can handle multi-entity, multi-currency, and project-based management, particularly for regranting activities under CLARIFI. A draft of required and desired specifications is available as a starting point, see below.
• Evaluation of Cloud-Based System Options: Research and evaluate a broad range of cloud-based financial management systems. The system must meet the core specifications outlined in Accounting System Requirements Overview (below) and be assessed for scalability, security, ease of implementation, and their ability to support consolidated reporting and regranting mechanisms.
• Detailed Recommendations for Top Three Systems: Provide a comprehensive comparison of the top three systems that best meet RRI’s needs. For each system, include implementation considerations, cost estimates, potential challenges, and specific features that support budget vs. actuals reporting.
• Operational Integration and Process Improvement:
• Assess processes for grants management, donor tracking, and HR focusing on where they overlap with financial operations.
• Provide recommendations for integration opportunities or system enhancements that would streamline workflows and reduce manual work when upgrading financial systems that may have broader capabilities and integrations.
• Budget vs. Actuals Reporting Enhancement:
• Evaluation of Budgeting and Forecasting Capabilities: Assess RRI’s current budgeting and forecasting practices and identify areas where a new system can improve the timeliness and accuracy of budget vs. actuals presentations to the Board.
• System Integration for Improved Reporting: Ensure that the recommended systems have strong budgeting tools that allow real-time tracking, comparison of budgeted vs. actual spending, and clear presentation formats for Board review.

1. Assessment of Financial Management Capabilities:

• Evaluate Financial Processes for New Entity Management: Assess current financial processes and identify adjustments needed to support consolidated reporting and financial management for CLARIFI as a 501(c)(3). Ensure the system can accommodate separate entity financials while providing a consolidated view for RRI.
• Compliance Review for Multientity Operations:
• Review of Compliance Readiness for CLARIFI: Examine RRI’s compliance framework to ensure it meets regulatory requirements for a regranting mechanism within a multientity structure. Ensure that the proposed systems can handle donor-specific compliance reporting and provide controls for financial and operational oversight.

1. Staffing Capacity for System Transition and Multi-entity Management:

• Assess Current Finance Team Roles: Evaluate the Finance team’s capacity to manage the system transition and provide ongoing support for multi-entity financial reporting and compliance.
• Recommendations for Staffing Adjustments: Based on the selected systems, recommend necessary staffing changes or new roles needed to support effective financial management across RRI, the Canadian subsidiary, and CLARIFI. Identify specific skillsets required for the team to maximize the functionality of the new system.

Accounting System Requirements Overview

The system should integrate key financial, project management, and reporting functions while supporting multi-company handling and global access. Below are a few of the key specifications that have been drafted by the RRI team to use as an initial guide:

• Worldwide Access: Accessible globally, with efficient operation across regions.
• Payroll Integration: Preferred integration with Paychex.
• Core Functionalities: Multi-company management, project and fund type tracking, timesheet management, approval workflows, general ledger, and accounts payable/receivable.
• Reporting & Automation: Custom reporting, automated allocations, project financial reporting, and dashboard customization.
• Project Management & Grants Accounting: Supports project-specific tracking, nonprofit grants accounting, contract management, and subcontractor management.
• Payments & Banking: Supports ACH transfers, cash flow tracking, and deferred revenue.
• Cloud-Based Solution: Web-based with hosting and updates managed by the provider.
• Security & Compliance: Role-based security and compliance with nonprofit accounting standards.

1. Deliverables

• Process Overview for Audit Committee:
• Submit a concise overview by early January 2025, summarizing the assessment process. This draft be presented to the Audit Committee for review and feedback. The preference is for brief, summarized data in the form of a slide deck of 4-5 slides total.
• Draft Report by Jan 31:
• Key findings from the assessment of financial systems and operational processes.
• Recommendations for financial systems and integration opportunities.
• Final Report:
• Deliver a comprehensive final report by February 21, 2025, including:
• Evaluation of multiple financial systems with detailed recommendations for the top three systems.
• Integration opportunities and process improvement recommendations for overlapping operational areas.
• An index of considerations for CLARIFI’s transition to 501(c)(3).
• Provide a brief roadmap outlining actionable steps for transitioning to the recommended financial system, including key milestones, timelines, and resource requirements.
• Presentation to Audit Committee:
• Present the final report and recommendations to the Audit Committee via teleconference around February 21, 2025 (specific date to be confirmed).

1. Consultant Qualifications

The selected consultant should possess:

• Experience with nonprofit financial systems, particularly in multi-entity, regranting, and compliance-heavy environments.
• Strong knowledge of cloud-based, project-oriented financial systems that support budget vs. actuals reporting and multi-entity financial management.
• Expertise in compliance and risk management frameworks for complex nonprofit organizations, with experience preparing organizations for new 501(c)(3) subsidiary structures.
• Proven ability to conduct staffing assessments for finance teams undergoing system transitions.

1. Proposal Submission

Submit proposals by December 3, 2024 via this website.

1. Proposal Submission Deadline: December 3, 2024
2. Consultant Selection: December 13, 2024
3. Contract Start Date: December 16, 2024
4. Process Overview Slides Due: January 6, 2025
5. Draft Report Due: January 31, 2025
6. Final Report Due: February 21, 2025
7. Presentation to Audit Committee: Around February 21, 2025 (date to be confirmed).
8. Evaluation Criteria

Proposals will be evaluated based on the following criteria:

1. Approach and Methodology (30%)
2. Cost (30%)
3. Experience and Qualifications (25%)
4. References and Past Performance (15%)