Cash Flow Management

Situation Overview: A disability rights organization with a $4.5 million budget was engaged in a constant cash flow struggle due to the highly cyclical nature of its donation cycle. During lean periods, it was forced to borrow against its credit line in order to meet payroll and other obligations. After the 2008 market downturn, the organization experienced a major fundraising shortfall and nearly exhausted its entire credit line.

Action steps: Reacting proactively to the downturn, NPFM worked with the leadership and board to reduce the operating budget by over $1 million. The organization began a multi-year capital campaign and continued to utilize NPFM’s proven methods of highly conservative budgeting and accurate financial monitoring processes.

Results: The organization has now surpassed its pre-2008 budget of $4.5 million. It hasn’t borrowed against its credit line for the past eight years – and it has built up cash and investments of $5.5 million. The board and staff rest easier knowing that the long-term financial health of their organization is secure.