BDO non profit chart
Nonprofits are confronting a host of challenges, including the threat of spending cuts from the federal government that could severely tighten their budgets and ability to serve their communities.
A recent survey from BDO USA found that many nonprofits are not taking steps to improve their operating reserves and liquidity at a time when the federal government is looking to rein in discretionary spending. While only 11 percent of the nonprofits surveyed by BDO named liquidity as a concern, 53 percent of them maintain less than six months of liquid restricted net assets.
Laurie De Armond, a partner and national co-leader of BDO’s Nonprofit & Education Practice, says there often is a balance in the nonprofit arena between having enough reserves to maintain stability and viability for the future, and be responsive to changes or disruptions within the industry.
Read the Accounting Today story here.