Most businesses find recordkeeping challenging, but nonprofits have even more to deal with. In addition to the HR records, financial documents, and customer files that other businesses need to keep track of, there’s also grant paperwork, donor records, board meeting minutes, and other documentation unique to nonprofits. It’s a lot to keep up with, and it can pull attention away from the work you do that matters most.
Nonprofits are required by law to keep detailed records to meet grant reporting, donor transparency, and financial accountability requirements. These records need to be organized, secure, and ready to share at a moment’s notice.
The problem is, managing all this extra paperwork eats up valuable time, adding even more to an already full plate. That’s why many nonprofits are looking for a better way to manage their records, and digitizing them is one of the most practical steps they can take. It makes organizing and retrieving information much easier, freeing up your team to focus on the people you serve.
In this article, we’ll look at the recordkeeping challenges nonprofits face, and how digitization can help your organization stay organized, compliant, and ready for whatever comes next.
Nonprofits Manage a Ton of Documentation
Nonprofits generate a lot of paperwork, much of it tied directly to funding, accountability, and the work they do in the community.
Donation records, grant agreements, board meeting minutes, and financial documents all need to be kept on file, often for years at a time. Each of these records plays an important role in demonstrating transparency and keeping the organization in good standing, but they pile up quickly and can be difficult to keep track of.
Grants often come with requirements to track how funds are used and what outcomes are achieved. Donor records help monitor contributions over time and support accurate reporting. Board meeting minutes document important decisions and preserve your nonprofit’s history. Financial records are needed for audits, tax filings, and maintaining tax-exempt status.
All of these documents matter, but keeping them organized is easier said than done, especially for nonprofits working with limited staff and storage space. Paper files can take over valuable office space and require constant sorting and searching. Digitizing records makes it much easier to keep documentation organized and ready to access without adding more to your team’s workload.
The Challenges of Managing All These Records on Paper
Paper records are difficult to maintain in any circumstance, especially when new documents are constantly coming in. With many different people handling and filing paperwork in an office, it’s easy for things to fall through the cracks.
One person might file a document in a way that makes sense to them, while another might handle a similar record differently, making it harder to keep a consistent system over time.
As nonprofits grow and add new programs or services, even more types of paperwork are created. Often, it’s up to employees to decide where and how these documents should be filed. This can lead to inconsistent filing practices, making it harder to locate documents later, especially if the person who filed them is out of the office or leaves the organization.
Paper files are also easily misplaced. Documents get left out on desks, filed in the wrong folder, or mixed in with other paperwork. Even with the best intentions, mistakes happen, and tracking down a missing document is both frustrating and time consuming.
All of this results in a recordkeeping system that relies heavily on employee memory. Staff often remember where certain documents are stored or how files are organized in ways that aren’t always documented. If a team member leaves or changes roles, their knowledge can go with them, making it even harder to keep paperwork organized and accessible.
Why Digitizing Makes Sense for Nonprofits
Switching from paper digital records is one of the easiest ways nonprofits can lighten the load of recordkeeping. Once your records are digitized, your staff will no longer need to spend their precious hours hunting through file cabinets or paper piles. Everything is stored in a central, searchable system, giving them access to what they need with just a few clicks.
Digitizing records also helps keep filing systems consistent, even as staff come and go. Instead of relying on memory or personal filing preferences, digital records follow clear naming rules and folder structures that anyone on your team can understand. This makes it much easier to add new records as they’re created and ensures important information doesn’t get lost when someone leaves the organization.
Security is another big reason to go paperless. Digital records are easier to protect with password protection, encryption, and secure backups. This helps keep sensitive donor details, grant paperwork, and other important information safe.
Digitizing your records also helps free up space. Paper files can quickly take over closets, offices, and shared work areas. Moving to digital records reduces or even eliminates the need for bulky file cabinets and off-site storage, opening up room for activities that better support your staff and programs.
How Long Should Nonprofits Keep Their Records?
Nonprofits handle many different types of records, and it’s not always clear how long each one needs to be kept. Some documents may only need to be kept for a few years, while others should be stored permanently to protect your organization and meet requirements from funders and regulators.
Donor records, for example, are often kept for at least seven years to align with accounting and tax reporting practices, and to track giving history for stewardship and future fundraising. Grant paperwork should be kept for the length of the grant, plus several additional years in case questions come up during renewals or audits. Financial records, including statements and receipts, are commonly kept for seven years or longer, while tax filings may need to be retained indefinitely to protect your 501c tax-exempt status. Board meeting minutes and key organizational documents like bylaws and incorporation papers are also kept permanently as part of your nonprofit’s official record.
Knowing how long to keep each type of record can be tricky, especially when it comes to deciding when it’s finally safe to let go of old paperwork. It’s tempting to keep everything just in case, but holding on to records longer than needed can take up valuable space and make it harder to stay organized.
Digitizing your records makes it much easier to follow your retention policies without the clutter. With digital files, you can set up reminders to review and securely dispose of records once they’re no longer needed, helping your nonprofit stay organized and compliant without worrying about overflowing file cabinets.
Having a clear retention policy in place helps your nonprofit stay prepared for audits and ready to answer questions from donors, funders, and board members without scrambling to find paperwork.
Digitizing Helps You Focus on Your Mission
Keeping up with paperwork will always be part of running your nonprofit, but it doesn’t have to take over your time or your space. Digitizing your records helps your team stay organized, makes documents easy to find when you need them, and protects sensitive information without adding to an already full workload. It’s a practical way to meet transparency and reporting expectations while minimizing the effort it takes to keep up with them.
At SecureScan, we’ve been helping nonprofits like yours digitize their records for more than 22 years. We work closely with your team to build a scanning plan that fits your needs, whether you’re dealing with years of archived files or a steady flow of new documents coming in each week. Our secure scanning services ensure your records are handled with care and digitized accurately, so you can spend less time managing paperwork and more time focusing on your mission.
If you’re ready to make recordkeeping easier for your nonprofit, we’re here to help. Contact us to learn more or get a free scanning quote from one of our scanning technicians today.