Overview

The integration between Blackbaud Raiser’s Edge NXT and Financial Edge NXT provides an efficient method for transferring gift activity into the accounting system. However, an important internal control is missing from the process.

When a gift batch is posted from Raiser’s Edge, the corresponding journal entry is automatically created in Financial Edge as an open journal batch. While the journal can be reviewed before posting to the General Ledger, Accounting has no structured workflow to review, hold, reject, or return the transaction for correction before it enters the accounting process.

Instead, accounting staff must manually delete journal entries, communicate corrections outside the system, and wait for a corrected batch to be recreated. This reliance on manual workarounds weakens internal controls, reduces efficiency, and creates unnecessary audit risk.

While Development is responsible for the accuracy of donor and gift information maintained in Raiser’s Edge, Finance is ultimately responsible for the accuracy, completeness, and integrity of the organization's financial records. Accounting should have the ability to formally review and approve—or reject—transactions originating from another system before those transactions become part of the organization's accounting workflow.

Why This Matters

Strong internal controls are fundamental to reliable financial reporting. Independent review of accounting transactions is a key element of sound accounting practices and aligns with generally accepted accounting principles (GAAP) and widely recognized internal control frameworks such as COSO.

Modern enterprise financial management systems recognize that moving data between systems is only one part of the accounting lifecycle. Equally important are the controls surrounding review, approval, exception management, and audit documentation before transactions become part of the official accounting records.

Financial Edge already incorporates configurable approval workflows for processes such as Accounts Payable, Purchase Orders, and Journal Entries because accounting review is a critical internal control. Journal entries originating from Raiser’s Edge should be governed by the same principles rather than bypassing them.

Extending these capabilities would align the Raiser’s Edge–Financial Edge integration with the governance expectations found in leading enterprise ERP platforms such as SAP S/4HANA, Oracle NetSuite, and Microsoft Dynamics 365, where configurable approval workflows, exception routing, and complete audit histories are standard components of financial management.

Vision for an Enterprise Workflow

Rather than simply adding the ability to reject a journal entry, Financial Edge should provide a configurable workflow engine that allows organizations to design approval processes that match their governance requirements.

Organizations should be able to configure:

• One-step or multi-step approval workflows.

• Multiple approvers.

• Role-based or user-based approval assignments.

• Sequential or parallel approvals.

• Approval routing based on configurable business rules.

• Organization-defined approval matrices.

• Service-level reminders and escalation rules.

• Workflow dashboards showing the status of every transaction.

• Complete audit history documenting every workflow action.

Workflow Actions

Approvers should be able to:

• Approve the journal entry and route it to the next approver or complete the workflow.

• Place the journal entry on Hold while questions are resolved or supporting documentation is obtained.

• Request Additional Information without removing the journal from the workflow.

• Reject the journal entry and automatically return it to Raiser’s Edge with comments identifying the required corrections before resubmission.

• Delegate or reassign approvals while preserving the audit trail.

Organizations should also have the option to require a final accounting approval before the journal becomes available for posting to the General Ledger.

Exception-Based Workflow

Not every transaction presents the same level of risk. Organizations should be able to configure exception-based routing so higher-risk transactions automatically receive additional review.

Examples include:

• Transactions exceeding configurable dollar thresholds.

• Restricted or endowment fund activity.

• Gifts with complex allocations.

• Transactions affecting prior accounting periods.

• Entries posted to sensitive or newly created General Ledger accounts.

• Manual overrides.

• Transactions that fail configurable validation rules.

• Any organization-defined condition requiring additional approval.

Routine transactions could follow a streamlined approval path, while higher-risk transactions would automatically be routed for additional review based on the organization's internal control policies.

Additional Capabilities

Additional workflow functionality could include:

• Automatic notifications when approvals are required.

• Reminder notifications for overdue approvals.

• Escalation to alternate approvers.

• The ability to attach supporting documentation directly to the workflow.

• Configurable approval matrices based on amount, fund, department, project, campaign, transaction type, or other organizational criteria.

• Configurable workflow rules without requiring custom development.

• Complete reporting on pending, approved, rejected, held, and resubmitted journal entries.

Benefits

This enhancement would:

• Strengthen segregation of duties between Development and Accounting.

• Improve compliance with GAAP-based internal control principles.

• Support organizations in implementing COSO-aligned governance practices.

• Reduce manual deletion and recreation of journal entries.

• Improve communication between Development and Finance through a structured workflow.

• Create a complete, auditable history of approvals, rejections, comments, and workflow actions.

• Reduce the risk of inaccurate financial reporting.

• Improve audit readiness.

• Provide organizations with the flexibility to configure workflows that align with their governance policies.

Business Value

Organizations invest in both Raiser’s Edge NXT and Financial Edge NXT expecting more than seamless data transfer—they expect integrated financial processes that support strong governance, internal controls, and audit readiness.

Today, the integration efficiently transfers accounting data between systems but stops short of providing the governance capabilities finance departments rely on to ensure the accuracy and completeness of financial reporting.

By incorporating configurable approval workflows and exception management, Blackbaud could transform the integration from a transaction interface into a governed financial business process that supports the complete accounting lifecycle—from transaction creation through review, approval, exception handling, and final acceptance into the General Ledger.

This enhancement would strengthen financial oversight, reduce manual effort, improve communication between departments, and provide organizations with the flexibility to configure approval processes that reflect their own governance requirements.

Most importantly, it would position the Raiser’s Edge–Financial Edge integration alongside the expectations of today's enterprise financial management platforms—not simply by moving data between systems, but by ensuring that data is governed through configurable, auditable, and policy-driven workflows before it becomes part of the organization's official accounting records.