Do You Have the Cash to Meet Your Obligations?

New standards related to financial statements for Not-for-Profit Organizations now require that you disclose your ability to meet your cash obligations.  With these changes, your financial statements must include disclosures revealing whether or not you have the cash to cover your general expenses. What does this mean?  Your liquidity will be known by your donors, grantors, government agencies, and any others who read your financial statements.  Do you know how you stand with the liquidity of your organization?
The disclosures that typically accompany your financial statements may indicate the following:
  • Your internal (board-designated) restrictions may keep you from using some of your cash for general expenses.
  • Your external (donor-imposed) restrictions may keep you from using some of your cash for general expenses.
A few questions to ask yourself:
  • Are you prepared for the possible challenges, both real and perceived, regarding your organization’s ability to meet your financial obligations? 
  • Do you have a cash flow projection? 
  • How about a cash reserve or emergency fund? 
  • Would you like to discuss these matters with a professional accountant?
Crosslin Accounting and Business Solutions (ABS) provides the expertise and experience in accounting and finance leadership, which allows management to excel in what they do best.  Would you like to explore how you may manage your cash and liquidity?  Contact Mark Myers, Director of ABS, to discuss these and other accounting and business solution issues (615-320-5500