Bri-anna Ramsden 0:05 Hello and welcome everyone. We're so glad to see you join us today. Today we're going to be chatting about a live look at modern finance system built for health nonprofits, specifically in the US. Today, we'll be going over some ways that US nonprofits are simplifying their workflows. I do want to make mention of a few housekeeping items. We're going to keep muted and off camera when we are not speaking, just to make sure you can focus on everyone who's chatting and so my cats don't start taking over the meeting in the background. Please feel free to put any questions in the chat or the Q&A. We do have time at the end to address them, and we have someone here who will be helping answer them in the chat. And we'll be sending a copy of this recording to your email within five business days. And now for a few quick introductions, I'll pass off to Gary to introduce himself.

Gary Servius 0:58 Thank you, Bri. Hello, everyone. Very excited to be here with all of you. So my name is Gary, as Bri mentioned. I am an account executive at Sparkrock. I've been working in this space for over 15 years now, and I'm really excited about today's conversation. And hopefully, I'll get to chat with some of you after the webinar.

Bri-anna Ramsden 1:19 And now for Kinley.

Kinley Graham 1:21 Hi, my name is Kinley Graham. I'm a CPA. I'm the director of pre-sales here at Sparkrock. I've been with Sparkrock for nearly 11 years and the five years before that, I worked for a customer as their chief information officer. So if you have any questions while the presentation is going on, just put them in the chat and I'm happy to answer them for you.

Bri-anna Ramsden 1:41 And Wendy.

Wendy Brown 1:42 Thanks, Bri. Good afternoon, everyone. Thank you for joining us today. I'm going to be your tour guide today as we go through different demo scenarios. I've been working with organizations like yours since 1997 with a focus on reducing manual efforts, paper-based processes, and moving to digital efficient experiences. I look forward to showing you what we have to offer today.

Bri-anna Ramsden 2:14 And I'm Bri, the Marketing Manager at Sparkrock. Been working with nonprofits for 15 years, and I'll be your moderator today. So to get started, I want to start with a poll. What's the most challenging manual process for your team? Is it purchase to pay workflow, employee reimbursable expenses, credit card reconciliation, or financial reporting? If it's all the above, please feel free to put it in the chat and let us know. We'll take a peek at our findings. So looking at the numbers, we see credit card reconciliation takes the lead. We got some reporting, some expenses, purchase to pay a bit lower. Lucky for you, we're going to chat a bit about this today, so I'm going to pass it off to Gary.

Gary Servius 3:35 All right, thank you, Bri. Okay, so before we dive into the frustration and the manual process that you have to deal with every single day, as shown from the poll, I want to first introduce you to the Sparkrock solution. So this way you'll have a good idea of who we are and that will help you to better understand how we solve the challenges that you saw from the poll.

All right, so let me start by saying that Sparkrock is a fairly unique solution, as it is a solution that is specifically designed for a nonprofit. And among other areas or industries, our software particularly resonates with health and human services organizations. So today we are an organization with more than 100,000 users across the US and Canada as well, an organization that managed over $16 billion in finance across our customers, and that has brought real change to the nonprofit world over the last two decades.

And this journey actually started about 23 years ago. And from the very beginning, our vocation and commitment has been to be 100% focused on nonprofit. We do not deal with the for-profit organization. We don't get involved in that commercial aspect. When we started, we wanted to solve one major problem: how to provide better solutions to nonprofit education, health, and human services. And back then it was an underserved market, to say the least, with very unsophisticated products.

We partnered with Microsoft and worked end to end with them really from the very beginning, from day one. Today, our solution is built on top of Microsoft Dynamics 365 Business Central. So as a result, you are benefiting from the entire Microsoft ecosystem — all the security, the stability, the Microsoft infrastructure, the privacy, the features, the functionality, the interconnectivity within the Microsoft environment itself — full integration with Excel, Outlook, Microsoft Teams, Power Apps, and so on. And of course, now the AI technology with Microsoft Copilot is fully embedded in our system.

What we bring to the Microsoft environment is really those layers of capability and features made for a not-for-profit organization that do not exist in the Microsoft environment and that do not exist in the vast majority of ERP solutions either. Most solutions out there are really tailored for businesses focused on revenue — sales, margin, and so on. But when you think about nonprofit organizations, you generally have fewer sources of revenue, but bigger chunks of that revenue as you're receiving your grants and donations. And as you're receiving those, you are actually heavily focused on the expenses, the money going out of the organization. It's all about how you spend that money, making sure that every cent is properly accounted for, especially since you must report back to your funders.

So you have to think about requirements around fund accounting, commitments and encumbrances, invoice approval, grant accounting, project accounting, and generating those complex regulatory reports that do not exist for the for-profit organization. In short, what we did is look at the level of sophistication that solutions like Business Central have on the revenue side, and we bring the same level of sophistication to the expense management side. And this is really a game changer for nonprofits.

In order to support you, we have a team of 135 dedicated employees with a level of expertise that you will not find anywhere else. And for the most part, they actually come from nonprofit, health and human services organizations. They were in your position, doing your job — they understand your challenges and they understand how to solve them, thanks to decades of experience assisting organizations just like yours.

Among our customers, we have federally qualified health centers, residential care, community living, public health authorities, and many more. We're talking about increasing your operational efficiency by 30%, reducing your overall IT infrastructure costs, and improving security and donor engagement. This is what I mean when I talk about a game changer.

So now that you understand a little bit more about who we are and how we work, let's go back to this poll. The answers you've provided are very much aligned with what we hear from organizations coming to us when they're looking to replace their ERP solution. So let's see how those challenges are being dealt with in Sparkrock — because showing you how we actually remove the pain and the manual process is even better than just telling you. Let's start with the purchase to pay workflow.

Of course, you need to track and process purchase requests, purchase approvals, invoices, and payments, while still ensuring compliance with donor restrictions, grant-funded programs, and budget limitations. And many of you have to deal with multiple locations. Without an automated process, requests are usually submitted via email or paper copy, leading to approval delays, miscommunication, and so on. Without an automated workflow, matching POs to invoices and ensuring expenses are properly allocated between restricted and unrestricted funds becomes a time-consuming manual process. This increases the risk of errors, duplicate payments, and missed invoices. Let's check in with Wendy and see how this is handled in Sparkrock.

Wendy Brown 14:02 Thanks, Gary. All right, so I'm going to be going into a live demo scenario. We're going to go through that end-to-end purchase to pay process. We're going to start off this scenario as a department manager user, and they're going to make a request to purchase.

Here in my department manager role center, you're going to see I'm able to simply choose the option to create a purchase requisition. We are now looking at our purchase requisition data entry screen. The first field is the auto-assigned number. The system can automatically know which location I'm at and can automatically populate that. You're also able to have different types of purchase requests, and you can drive a different approval workflow based upon the type of purchase request being entered.

When we get down to the line detail, you'll see that I have a couple of options. One of them is item, which I would use in a scenario where you have a warehouse or stockroom and you would consume from your inventory instead of sending a purchase order out to a vendor. In this example, we're going to use Expense Type, which is a feature that Sparkrock has built to better drive the experience when doing your requisition. I've chosen an expense type of program supplies, and by choosing that expense type, a couple of things have happened automatically — it has defaulted to my GL and populated a default vendor. The next thing I'm going to do is choose the account set, which is going to bring together all of the dimensions that are applicable, automatically populating the GL account and all dimensions.

Now, lots of customers require that additional supporting documentation be included, such as three quotes. When it comes to your budget, we offer both proactive and reactive budget checking. With proactive budget checking, I can simply click on check budget and it will inform me I am over budget. You can drill down to the encumbrances or the actuals to get right to the details. With reactive budget checking, you have options when configuring this — whether it's a warning or a hard stop. We can see that the approval request has been sent and the status is now pending approval.

Now we're going to change our roles and look at this from the approver's perspective. This is the approval user's universal inbox — everything that needs their attention. They're able to approve, reject, delegate, add comments, or go right into the record. They have full visibility on any supporting attachments, links, or notes. The approval workflow is based upon a number of factors — dimensions, dollar values, and GLs can all create the pending approvals for the required users.

Now we can see the status has moved to approved. Typically, you would have a purchasing department — this is my purchasing agent, and they have an actionable dashboard showing all approved purchase requisitions. The purchasing agent picks it up, sees all the details including notes and attachments, and their step is to send this off to the vendor. You can also have an automated workflow so that once the item is approved, the whole process of creating the purchase order and sending it to the vendor can be automated.

We'll create the purchase order and send it off to the vendor. The original requester is typically who's going to receive those goods. They are able to receive it with an option to do either a full receipt or a partial receipt. I'm going to go ahead and post this receipt.

Now the accounts payable department will pick this up. It's very quick to have a saved search to look at all purchase orders that have been received but not invoiced. From here, I'm going to create a purchase invoice for this vendor and receive it against the purchase order receipt. You can also leverage the power of OCR and AI to bring that over. Here we can see all the detail from the original request, including the attachments, has all flowed through — all of the coding is maintained and we have all the details right here.

So let's go ahead and post this invoice. Here we can see the purchase invoice with all the detail, and this can now be paid. It is also updating the vendor record and all the details regarding their balance. The vendor details store information such as their payment method, and also whether they are a 1099 vendor, in which case their transactions will be stored for creating those vendor 1099 forms. In the payment journal, because this is an EFT, we're going to create the journals for that and generate the EFT file — that is the file we would send to the bank. Then we do our vendor remittances to inform the vendor that payment has been made, and our last step is to post this transaction.

In real world, you're likely going to use the Suggest Vendor Payments feature, which allows you to gather everything that needs to be paid and filter by different payment methods. If you are printing checks, positive pay exports are automatically created for you as well. Before I leave purchasing, I did want to circle back on vendor 1099 reporting. We can do a vendor overview showing the NEC form box and all vendor 1099 transactions for a specific vendor, with the ability to drill down to the specific details including supporting documentation. That is your end-to-end purchase request to pay process.

Gary Servius 27:53 All right, purchase to pay — check. Thank you, Wendy.

Okay, so the next two items are topics where the feeling of frustration is very common. We're going to group employee expense claims and credit card together. Many organizations have employees submitting their expenses via email or paper, often without consistent formatting — sometimes a template that gets converted to PDF and emailed to a manager, or dropped into an online folder with receipts. In all cases, these require the finance team to manually review receipts, categorize expenses, and ensure they align with organization policy. This process is time consuming, particularly with a large volume of submissions, and increases the likelihood of errors, missed receipts, and misclassified expenses.

When it comes to credit card reconciliation, that is probably the most time-consuming task that your accounts payable team has to deal with. Matching credit card transactions, ensuring all charges are properly categorized and coded in the system takes a lot of time and effort when done manually, especially with a high volume of transactions and multiple corporate cards. And your accounts payable team is likely spending a lot of time sending reminders and chasing people around the office to get those receipts.

So how is this handled in Sparkrock? Imagine a solution where employees can submit their expenses and receipts directly in the system, from their phone or any device — not a totally separate solution, but one where everything is connected. You're able to have approval workflows that can be as simple or as complex as you want. You can enforce company policies, have real-time budget checking, and no longer deal with manual reconciliation. Let's see what Wendy has to show us.

Wendy Brown 30:41 Thanks, Gary. Before we jump right into the employee expense experience, I'm going to show a little bit of the setup of the purchase cards and how we manage that. When we look at the purchasing cards, we can see all the people in your organization who have a purchasing card, the card number, and what type of card it is. When the credit card statement comes from the bank, we import that statement into our purchase card journal.

Here we can see all of the transactions that have come in, with details regarding the merchant and the charge. We even get an alert if there are any duplicates, and it allows you to click through and see why a record is being identified as a duplicate. This is going to automatically create the invoice for my credit card company, and we can see each of the purchasing card totals at the line detail level. When we look at the GL entries, we can see this has gone to our purchasing card clearing account, which will then be cleared when employees code their transactions and send them back through to finance.

Here's what it looks like from the employee's perspective, in MySpark Rock — the end user self-serve finance and HR portal. In the expense claims section, we can see all of the purchasing card transactions from this month's credit card that are attributed to me. It's my job as the credit card holder to review these, attach receipts if required, and code them. The first step is the expense type — for example, this was breakfast. I'm able to upload the receipt, and based upon the expense type, my GL has automatically defaulted. The account set I'm allowed to attach this to is limited based on my filters and what I'm allowed to see.

We also support out-of-pocket reimbursable expenses. The difference is that out-of-pocket expenses will go through the AP process and cut me a check or EFT or ACH, while P-cards clear against the purchasing card clearing account. You're also able to reinforce policies — for example, on a breakfast expense there may be a maximum allowable of $16, so if I enter $20 it will move it to $16. The expense type drives the default GL, and the account set automatically populates all of the dimensions, making it simple for non-financial users to record their expenses.

When ready to submit, you click make claim. You're able to have full transparency on your budget, seeing where you are and whether you're overspending, as well as seeing who your approvers are. On the administrative side, the expense claim appears in the approver's request-to-approve inbox. They're able to see all of the details and attachments at the line level, as well as any policy warnings. Once approved, this gets created into a purchase document that clears against the purchase card clearing account.

A very useful tool for managing these transactions is what we call the Purchase Card Register, which allows you to simply see any unassigned expenses so you know who you need to follow up with. That was a quick view at the expenses and purchasing card process.

Gary Servius 40:13 Thank you, Wendy. All right, so finally, the last item we would like to explore today is financial reporting and financial analysis.

Improving reporting capabilities is always one of the top items for nonprofit organizations. Very often we have finance teams dealing with many different solutions and systems that do not communicate with each other — data from the accounting system, spreadsheets, bank statements, payroll systems. They need to aggregate all this data, reconcile it to ensure information aligns, and prepare financial reports for various stakeholders: the board of directors, leadership, the finance committee, program managers, department heads, and funders. These reports are in many cases formatted and distributed through email or printed copies — really intense, time-consuming, and presenting an important risk of errors.

The lack of real-time data forces your team to rely on information that does not reflect the current financial position of your organization. By the time they get those reports, they're already outdated by several days, sometimes weeks or even months. You are blind when you don't have real-time visibility on your budget, expenses, and commitments, and it makes it very difficult to identify discrepancies or take appropriate action.

For health and human services organizations, you also have regulatory reports that need to be submitted to the Department of Health and Human Services, the Health Resources and Services Administration, the Centers for Medicare and Medicaid Services, the State Department of Health, and so on. Those can translate into hours, days, and sometimes weeks to produce. Let's turn to Wendy and see how reporting and financial analysis works in Sparkrock.

Wendy Brown 42:47 Thanks, Gary. Reporting is one of my favorite topics — I'm a bit of a data geek. What you're going to see is that reporting is really pervasive throughout the application, allowing you to drive insights from any data you're looking at, and it crosses many different types of stakeholders.

I'm going to start with non-financial user reporting. In MySpark Rock, we have what we call financial analysis, which allows administrators to push out different data sets. For example, looking at projects, we can see the budget for each project, our commitments (requisitions and requests), and our actuals, and I can drill down to the transactional level to understand what is impacting performance against that budget. You can similarly filter by grant and see how you're performing against your budget, how much budget is available, and drill down to those actuals including posting dates, descriptions, and all other dimensions.

Now let's look at some of the reporting options in the back office. Starting at the chart of accounts, you have full transparency on your budget — you can see your budgeted amount, your commitments (purchase requests), your encumbrances (purchase orders), and your net change (actual invoices and payments). The analysis tool uses Copilot AI to help you build reports using natural language. For example, if I want summary totals by quarter, I can ask the system in natural language and it will provide that view with the ability to drill down to the transactional level details.

There is also built-in reporting for regular financial statements like your balance sheet, where you can control the date range and even control the dimensions being reported on. All reports can come out as PDF, Excel, XML, or data only, and they can be scheduled to appear in your report inbox.

For more advanced reporting, the financial reports tool allows you to create custom reports such as budget comparisons over several years, with the ability to drill down on actual details and filter by different dimensions. You can also export to Excel to customize formatting, since the Excel tools are part of the Microsoft ecosystem and reduce the barriers between your finance system and your other productivity tools.

Finally, you can incorporate Power BI reports with real-time integration. Power BI can create visually appealing reports with drill-down capabilities, and these can cover commonly requested items such as aged accounts receivable and aged accounts payable. That was a quick look at some of the reporting capabilities within the finance system.

Kinley Graham 51:32 Thanks, Wendy. We wanted to quickly go over a few of the other capabilities that Sparkrock offers. Starting with APIs and integrations — we have standard integration partners for a number of different areas of the system, as well as standard APIs available to all of our customers to facilitate integrations between products. These can connect to lots of other systems and get data into the GL and other parts of the system.

We have a dedicated fund accounting module built specifically for not-for-profits. We know how important fund balancing is and how tedious it can be, so we've built an entire module that will automatically generate the entries for all of your fund balancing needs.

We also have a project and grant accounting module where you can have multiple budgets, create different dimensions, track the status of projects and grants, build in revenue schedules, and do lots of great tracking.

Our contract management module attaches right into the normal purchasing part of the system. It allows you to track contracts associated with vendors, manage contract limits with hard stops or warnings, report on contracts, and store attachments.

Finally, we have fixed assets and inventory modules. Business Central is a great inventory system, and we've incorporated that into our purchase requisitions so you have the ability to request and purchase from your own inventory and have it delivered to locations. Our fixed asset module allows you to track expenses associated with assets, handle advanced CCA postings, and handle depreciation entries — so when you're doing your government remittances, you can filter on one account and still get all your reports. Please let us know if you want to know any more information about the system.

Bri-anna Ramsden 54:10 While you guys have been talking, a few questions have come in. So we'll start addressing those. Number one, do you have OCR capabilities?

Kinley Graham 54:25 Yes, we do have OCR capabilities. There are a few options out there. We have OCR that flows directly into the system. You can send your AP invoices to an email address and the OCR will recognize them, code them, and put them right into the purchase invoice module. It has the flexibility to attach into other modules as needed — we've had one customer use this to populate deposit lines by emailing in a picture of the deposit slip, which would automatically generate all of the deposit lines. It's pretty powerful and can connect throughout the system.

Bri-anna Ramsden 55:08 Can this replace the typical third-party system for expenses?

Kinley Graham 55:17 Oh yes, definitely. Our expense module works fantastic. It's really powerful and flexible, it works on your phone, you can take pictures of your receipts, and there's not really a need for other expense platforms. It integrates directly into our system and everything is there immediately when you submit it.

Bri-anna Ramsden 55:43 Is there any limit on approval configuration?

Kinley Graham 55:48 In our system it's really powerful. Your approvals are controlled by dimensions and GL accounts. You can bulk edit, have different thresholds, groups, sequential approvals, pick approver, and an over-budget approver. There is no limit on the number of approval steps, approval rules, or approval limits. So go to town — it's great.

Bri-anna Ramsden 56:26 How does the system help with year-end spending?

Kinley Graham 56:30 The system shows everything up to date. With the ability to see approved requests that come in as commitments and then having your encumbrances once you've encumbered the money and sent out your POs, it gives you a true financial picture up to the minute. The Sparkrock solution lets you see not only everything that was spent, but everything that was promised and how much budget room was left, so you can go out and spend that money for the people you support as efficiently as possible right at year-end. It was really nice having that transparency.

Bri-anna Ramsden 57:11 Is this a SaaS solution and where is it hosted?

Kinley Graham 57:16 Yes, this is 100% a SaaS solution. It's built on top of Microsoft Business Central and hosted in Microsoft Business Central Online. This environment is completely closed off and extremely secure — there is no database access for anyone. You get to pick your data residency. If you pick a US data center as your primary location, it data replicates fully within the US and no data leaves the country. You are in control of your data at all times. Sparkrock does not have access to your data or your database backups — you control all that access, you provision the users, and you give us access.

Bri-anna Ramsden 58:00 Do you need a Microsoft license to be able to use Sparkrock?

Kinley Graham 58:05 Our licenses do require Microsoft licenses, but you do not procure those separately. When you purchase a Sparkrock license, it comes with the corresponding Microsoft license based on that user level. If you have any questions about licensing or anything at all, make sure you reach out to any of us on the call.

Bri-anna Ramsden 58:27 And that's all the questions. If you have any more, you can always reach out to us directly.

Gary Servius 58:39 Thank you very much, all of you, for coming. We appreciate seeing you. I hope that was good information. If you have questions that come to you after the fact, please don't hesitate to reach out and we'll be happy to help.

Wendy Brown 59:01 Thank you. Bye.

Bri-anna Ramsden 59:01 Thank you! Have a great day!

Kinley Graham 59:03 Thanks.