Best Practice: Recording Donations

If your organization receives donations, you should record them using Customer Receipts with Bypassing AR.

Why this matters

• Donations are not invoices and do not represent collectible AR.

• Creating Sales Invoices and then paying them off with Customer Receipts can:

  • Temporarily overstate AR

  • Distort financial reports if receipts are not processed promptly

  • Add unnecessary steps and slow down donation processing

Recommended Approach

• Use Customer Receipts directly to record donation income

• Post receipts straight to the appropriate donation revenue account

• This keeps:

  • AR accurate

  • Donation recording simple and timely

  • Financial reporting clean and reliable

Donation Tracking

To support reporting and compliance, you can add custom fields to Customer Receipts, such as:

• Donation type (General, Missions, Building Fund, etc.)

• Campaign or fund

• Donor intent/restriction

• Event or appeal reference

• Tax-receipt flag

This approach provides clear audit trails, accurate financials, and a faster workflow—especially important for nonprofits and churches.

Article Best-Practice-Recording-Donations  ·  Last updated February 03, 2026 · GoldFinch ERP Help Center