Leadership and The Workplace

Nonprofit Spark

Renee McGivern

Nonprofit Spark – Primer on managing your non-profit’s cash flow – 09/03/12

It’s the Labor Day holiday in the U.S.and so I’m taking a break from my work by repeating one of my favorite shows. Believe it or not, it’s about managing cash flow. The thing I love about this show is that my guest, who is a CPA specializing in nonprofit accounting, shares from his direct experience as a board member of a youth service organization.

Most leaders of active non-profits produce a monthly balance sheet and income statement. However, many don’t produce a cash flow projection which tells executives and board members if they’ll have enough cash in the bank to cover the bills every month. On this week’s show, my guest and I discuss why managing cash flow and using a projection is so helpful. For instance, you won’t panic when you see a deficit on your next income statement. You’ll anticipate when you’ll need to borrow cash, and you’ll know how much your line of credit needs to be at the bank. And you won’t operate under the illusion that you’re rich when most of the money in your bank account is not for general operating expenses.

Jon Hoffmeister is a CPA and partner with CliftonLarsonAllen, our Nonprofit Spark sponsor. He has more than 20 years experience assisting nonprofits, colleges and universities, and closely-held businesses. Jon has been serving on the board of a community youth service agency for more than 10 years, and has been treasurer and finance committee chair much of that time. His financial leadership of the agency earned him statewide recognition for outstanding dedication in helping youth, and for his appreciation for the challenges facing non-profit managers.

On this show, Jon uses his practical experience with this agency to highlight his key points about managing cash flow. Even the most financially-phobic non-profit leaders will understand this show!

A great companion Nonprofit Spark episode to this one is Understanding a Balance Sheet from February of 2011. No kidding, I still see downloads of this show and the balance sheet we discuss several times a week, it’s that helpful!