Are you anxious about losing staff to NonProfits of privilege that can pay more? New staff walk away and dedicated staff lose morale when there is no paycheck.
If you need to turnaround your nonprofit, this module has priority.
Abundant Cash is the 4th of Four Decisions that every NonProfit leader must master. The other ‘Four Decisions’ are Right People, Sustainable Strategy, and Flawless Execution.
When things are bleak, we run the 17 sources of 90 days of cash tool. This allows you to make payroll while there is serious planning about a quick win in the 2nd 90 days.
Choose an agency in your nonprofit sector and use this tool to compare your 990 history with theirs. What is their Labor Efficiency Ratio? What % of total payroll is spent on leadership? Fascinating for decision-making.
Program your assumptions for revenue and expense in each of the next 5 years. Watch the formulas drive balance sheet and cash flow projections and keep making adjustments.
Reduce the impact of paying bills on government contracts that don’t plan to pay this year.
Using the 4 requirements for capital reserve, game out normal, economy, and disaster scenarios to see if you can survive the stress.
Each program fills in 5 years of historical data and then creates 5 NonProfit budget income statement scenarios – optimistic, pessimistic, and target for Year 1, and then 1 scenario each for Years 2 and 3
When programs start to allocate leadership and other costs across a variety of programs and contracts, this tool gives the CEO an easy way to understand and make decisions with the finance team.
All nonprofits should aim for Flawless Execution in 3 Processes. Many nonprofits emphasize Accounting or Finance or both. This tool suggests procedures to include.
Nonprofits have narrow margins and limited equity and debt funding. This tool starts conversation about the sources of launch capital for new programs
Crabtree suggest that the reserve fund satisfies 4 different cash needs and this tool starts a discussion of the total required cash on hand.
There are only 50 ways to commit fraud (according to Joseph Wells). This tool helps leaders close the 5 most dangerous potential frauds for their agency.
This is another tool to perfect Flawless Execution in Finance and Accounting. The tool helps you to create a calendar of required events and when the CEO or board should check.
At different stages of your agency life cycle, your quest for types and amounts of cash will change.
Sometimes this tool advises you to turn away from a grant, contracts or gifts that you can obtain.
Work backward with this tool to see what you need to do this year to provide the launch capital that you need next year
Many nonprofits start with great hope for gifts and grants. This tool asks about 10 sources for nonprofit start up and 25 other options for B Corp or Public Benefit Corporations
Perfect for Program Directors with limited financial training as they fill in teachers, rate, and schedule and match that to revenue, OTPS1, and contribution margin. The NonProfit budget generates itself!
From Ronald Tompkins’ book of the same name, this tool reviews common areas that create stability in the Accounting and Finance function.
In strategic planning, this tool positions various options on a chart that plots how much cash will be required and how much impact the project will return
Greg Crabtree – Necessary reading!
John Zietlow – Financial Policies
Timothy Jury – Cash Flow
Joseph Wells – Fraud and Internal Controls
Dennis Young Financing NonProfits
Kenneth Marks Financing Growth
Alex Nicholls Social Finance
Ron Tompkins speaks at an OpCon panel on NonProfit accounting
Cash and NonProfit Budget Tools