Cash flow is essential for every nonprofit. While it is obvious that you need more funds coming in than going out, calculating this reality is not as straightforward. The timing of income and expenses dramatically affect cash flow projections.
You need to understand the effect of various payment terms, grant disbursements, expense reimbursements, and dozens of other factors that make your organization’s bank balance fluctuate from one month to the next. You can use cash flow statements and cash flow projections to get a grasp on financial health now and into the future.
- How do cash flow statements and cash flow projections differ?
- What steps should you follow to create a cash flow projection?
- What elements of cash flow can you control?
- How can your board and supporters help your cash flow situation?
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