Nonprofit businesses are a major economic force in New Mexico, employing one in 20 paid workers and generating an estimated $1.2 billion in wages in 2003, according to the UNM Bureau of Business and Economic Research. But Leslie Oakes, chair of the accounting department at the Anderson School of Business, says that many nonprofits fail due to poor bookkeeping.
To help prevent these issues, Anderson faculty members Oakes, Craig White and Janice Moen have founded NonProfit Back Office Resources, a nonprofit accounting agency that aims to assist New Mexico nonprofits with proper bookkeeping.
“One of the things when you start looking at nonprofits is you recognize how many problems they have,” Oakes said.
She said NonProfit Back Office Resources aims to help nonprofits without charging them the high rates of other accounting agencies.
“Maybe we could save nonprofits,” Oakes said. “It’s really important for the state because in New Mexico about 50 percent of our economy is government and nonprofit, so if nonprofits don’t do well here, it means people lose their jobs, it means there’s no services.”
Oakes said the state’s nonprofits don’t receive the dollars of grants in correlation with the population due to a lack of skills in New Mexico’s nonprofits. Oakes said she and her partners saw this as an opportunity to help nonprofits receive accounting services at a discounted price.
“(Nonprofits) don’t have good bookkeeping, so they don’t have good accounting,” Oakes said.
Oakes said that there was a federal law passed recently that stated if a nonprofit doesn’t file with the IRS for three years that the nonprofit’s 501C3 tax status is lost.
“If you don’t file for three years, you lose that status,” Oakes said. “ So that means you can’t get most grants, you can’t work for the state and if I donate to that organization I can’t deduct it from my tax forms, and a lot of money that nonprofits use is donated from people who need that tax break.”
Oakes said NonProfit Back Office Resources has helped about 23 nonprofits thus far, one being a halfway house for criminals waiting for sentencing. The agency has also helped churches and other community organizations.
Moen, CEO of NonProfit Back Office Resources and a former student of Oakes, said that the main challenges they’ve faced with the organization is finding funding.
“We don’t have any private donors yet, but we did do grant applications for the foundation.” Moen said. “We’re hoping to find some private donors who are interested in what we’re doing.”
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Moen said it took three years for the organization to receive private funding, two of the funders being the McCune Charitable Foundation and Kellogg.
NonProfit Back Office Resources hopes to employ interns, but Moen said that they have run into some trouble during the process due to a lack of trainers for intern positions and the lack of funding the McCune foundation is able to provide to train these trainers.
“(The McCune foundation) doesn’t have the funds to fund (the training) but they want to help find funding for that project,” Moen said, “If we’re able to find funds for that trainer at Anderson...we will have a model that is unique in the United States.”
Moen said the model allows for Anderson’s accounting students to receive hands-on training prior to graduation to give the students real-world experience with accounting.
“There is nothing like this in the United States,” Moen said. “It will take Anderson to a whole other level.”
Moen said the organization will continue to grow and that her future hopes to the business is that it keeps growing in order to serve more nonprofits around New Mexico.
She said she doesn’t want to lead the organization for its entire existence, but hopes to hire employees that will sustain the business in her absence.
“We’re hoping to make it so that it is sustainable not based on personalities, so hiring people that can keep this organization going a long time in the future, long after I retire.” Moen said.
Fin Martinez is a reporter for the Daily Lobo. He can be reached at news@dailylobo.com or on Twitter @FinMartinez
