1. New Company Set-Up Restriction. When setting up a new company, you are asked what type of company you would like to establish: S-Corporation, Corporation, Sole Proprietorship or Partnership. There is no choice for nonprofit organizations (NPOs), but they are corporations (just incorporated under the nonprofit incorporation laws of a state).

Since Peachtree is software for businesses, it is assumed that you will have ownership: capital stock and retained earnings. NPOs will find some challenges in this area when using Peachtree. You are locked into using the "Retained Earnings" account, rather that "Net Assets" or "Fund Balance". The retained earnings account is considered the default "rounding account" and it collects the difference between revenues and expenses for the accounting period.

2. Fund Accounting or Net Asset Accounting (SFAS No. 117). NPOs should first decide whether they want to emulate fund accounting or net asset accounting. Fund accounting collects revenues and expenses for unrestricted and restricted purposes and facilitates grant reporting. However, auditors are required to report on whether the NPO followed Generally Accepted Accounting Principles (GAAP) which is Net Asset reporting (established by the Financial Accounting Standards Board in Statement No. 117 in 1993). This decision involves more than just what to call the equity accounts. Retained earnings, Fund Balance, and Net Assets are not the same. Enlist the help of an accountant familiar with nonprofit accounting.

3. Cash vs. Accrual Accounting. One question asked in the set-up routine is whether your company uses cash basis or accrual basis accounting. This decision can't be changed, so it is best to choose accrual accounting (generally accepted accounting principles GAAP) even if you just record transactions on a cash basis. This option will allow you to do adjusting journal entries for receivables and payables at the end of accounting periods to be in conformance with GAAP (necessary for an unqualified audit opinion).

4. Chart of Accounts. Peachtree supports account numbers that are less than, or equal to, 15 places. A description is used, as well as, what classification the account is. Peachtree allows numbers and letters to be used as account numbers. The numbers are sorted before letters and capital letters are sorted before lower case letters.

5. Customization of Financial Statements. With Peachtree, the user can copy over the basic format of pre-designed financial statements, such as service organizations. Modification to these statements can be done so that the user can build his/her own financial statements. The "Income Statement" of an NPO is called a "Statement of Activities". Voluntary Health and Welfare Organizations are required to prepare a Statement of Functional Expenses. This is a report that shows functional expenses (program's expenses and supporting expenses, such as general and administrative and fundraising) as columns of numbers and "natural expenses" (e.g., salaries, supplies, interest, depreciation) as rows or line-items.

Peachtree does allow revenues and expenses to be classified as to type, program, and funding source through use of fields in the account name in the chart of accounts. The user can then create reports that will sort information using a filtering command. A spreadsheet or database application may work with greater efficiency.

6. Internal Control Feature. Peachtree has a function that allows for the creation of passwords to protect your data. Initial set-up requires two passwords, one for the area you want to protect, and a second one to allow you to make changes in the passwords. You have 1 - 49 choices in areas of A/R, A/P, P/R, G/L and Inventory. (Passwords are case-sensitive). Peachtree allows default information to be set to prevent mistakes, lessen the effects of forgetfulness, and facilitate standardization.

7. Support. Peachtree has a help feature and a support feature in the software (Click on "Help" from the pull down menu). There are several sites on the Internet to which the user can refer. References are available in the form of manuals, books, tutorials as well as training courses. One reference is "The Essentials of Peachtree Complete Accounting". A second is Peachtree Software’s Solutions Newsletter. When on the homepage of Peachtree (www.peachtree.com), the user can click on a highlighted item, which is a section for frequently asked questions pertaining to their software.

8. Budgeting. There is a budget feature in Peachtree. By going to the chart of accounts number, clicking on the budget tab, the user may designate the budget amount and allocate amounts to different months.

9. DDE Peachtree Feature. From the pull down menu labeled "Edit", there is a copy link command. This command creates DDE link data. The link can be pasted into other software that supports it. The relevance of a feature such as this is that information can be transferred to other applications without a lot of effort. To paste information into the document of application such as Microsoft Word or Excel, go to the "Copy Link" command in the "Edit" menu, designate the file, field, and file keys. Select "ok", open Word and use their "paste link" command.

10. Price Comparison - Business vs. Nonprofit Software. Low-end software for commercial businesses such as Peachtree and Quickbooks range from $100-$300. Not- for-Profit fund accounting/net asset software ranges from $1,000 - $5,000 per module.