Is Business Central Bad for Your Nonprofit?

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In our post-pandemic economy, working from home is no longer a fringe benefit. For many it’s a new work life. Technology and specifically cloud computing has made working anywhere, any time, and off any device an essential part of our environment.

Nonprofit organizations have also embraced this remote work concept. The question is, does Microsoft’s ERP software and cloud platform work for nonprofits?

It’s true Microsoft offers nonprofits reduced pricing as incentive for moving to the Microsoft Dynamics 365 Business Central (Business Central) solution. Folks at the software giant know the importance of serving our great industry, and of keeping good customers. But if you’re thinking of moving to Business Central from one of your on-premises solutions, beware the old saying, “you get what you pay for.”

To be fair, let’s take a deeper look. . .


Before turning away from your Microsoft Business Central option, it’s important to acknowledge all the features and power you get out of the box.

If your needs can be met with Microsoft’s cloud platform and Business Central, you know you’ll be in great company. Over 220,000 businesses and organizations use Business Central every day. That’s about 3 million people around the world who have found a good home here. And Microsoft is the gold standard of ERP software solutions … and office solutions … and cloud computing. There is a growing community of Microsoft AppSource  apps and information to rely on for modern technology at your fingertips.

And here’s what you get with the Microsoft cloud platform:

Data Management

  • Continuous auto backups of your data, and these backups are replicated in multiple sites and geographies so no matter the concern, from hurricane to earthquake, your data is safe.
  • Access to those backups when you need. Getting your data on demand might not be possible with some other platforms. If you need to pull your data down from the Microsoft cloud you can do so in a matter of minutes and from you administration portal, so your IT folks don’t even have to be involved. With Business Central, your data is not held hostage if you later decide to move to another product.

Data Security

  • Microsoft has whole teams of people looking after their server farms. They test frequently and work diligently to make sure that precious information you’ve spent years building, stays safe.
  • Microsoft says your data is safe. You have access to it whether from individual pages or entire databases when you need.

Up Time

  • This leads us to Microsoft’s guaranteed “up time.” With the massive network of servers and server farms, Microsoft confidently claims to have a 99% plus uptime. When they say you can operate anywhere at any time, they truly mean business.

Modern User Interface

  • There’s also a commitment to keeping end-users at the forefront of modern technology as both Microsoft and its Industry Solution Vendors (ISVs) update their ERP software monthly. This service is offered as part of your annual subscription fee. It often happens over a weekend or at night and you do not have to do a thing but login from wherever you are and start working in constantly updated – and enhanced - software surroundings.

Solid Partner Community

It would be remiss to be silent about the Microsoft partner network.  Some companies say that you have access directly to them, and that they don’t mess with partner programs.  However, Microsoft, in all its magnitude understands it cannot be all things to all people.  Microsoft supports a vast and growing community of partners with the education, training, and skills necessary for your support. Wherever you are you’ll be in good company with a Microsoft partner nearby.


If you’re operating a for-profit business, nothing.  But if you run a nonprofit there may be some issues. Here are a few features that don’t come “out of the box” from Microsoft.

A nonprofit oriented User Experience

Business Central is a great ERP product that focuses on for-profit businesses – manufacturing, distribution, professional services etc.  But for the third largest workforce in the US, a first look at Business Central can feel a bit disappointing.

The Account Schedules (Business Central’s built-in reporting tool) have balance sheets, but not statements of financial position.  The samples and screen shots tend to focus on “sales revenues” and neglect “procurement and expense reporting.”

The result of a first glance at Business Central is that you’re experiencing a dialect of business language that neglects the transparency and accountability language skills of nonprofits everywhere.

Fund accounting

Some people think you can put a small feature into the General Ledger and call it a day.  True fund accounting, however, needs to be a part of every purchase, project, program, event, encumbrance, and budget you have.  True fund accounting takes into consideration that nonprofits like yours are basically in the business of spending other people’s money wisely, recording and reporting how that money is spent and the impact it has, to get funds for more projects and worthy causes.

This cycle of business is what makes nonprofits our social safety net and world nurturers. Good accounting software must address this need to record, report and trace transactions with automation tools to keep you out of spreadsheet chaos and into transparent operational efficiency.

Advanced Allocations

Many of the funds a nonprofit receives have financial obligations attached.  Some funds may be unrestricted but just as many have restrictions by and for multiple stakeholders.

To make things more complex, you may need to use money from multiple funds for a single project but must be able to report on them to the various stakeholders involved.  You might use a percentage calculation or a square footage basis, but it must be clear what method you’re using in every transaction you make.

And then funds often have different start and end dates. It’s enough to make your head spin. Some software is available to manage these allocations automatically, but not Business Central out of the box.

What about productivity and operational efficiencies?

Nonprofits have to connect many constituents into the accounting process. Staff, management, auditors, remote employees and volunteers are all part of the software deployment.

Connecting non-accounting personnel for entering time, expenses, requisitions and purchases, combined with a paperless approval system are must-haves for the modern nonprofit workforce.


In a word, yes.  Remember ISVs?  Some exist who focus on the nonprofit industry. They work hard to build and continuously update complete solutions that you can find in the Microsoft AppSource.

In AppSource you can explore multiple ISV offers, from small applets to complete industry solutions.

Tangicloud’s Fundamentals offers complete ERP and fund accounting functionalities, covering all the “fundamentals” necessary to effectively run your nonprofit.

In sum, nonprofit accounting with Business Central is not really a problem but be sure to check beyond base product to the ISV that will take you to the cloud. Please contact Tangicloud today for more information.

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