FINANCIAL STRATEGIES Unit 2 DISCUSSIONS
250 WORDS PARAGRAPH A UNIT 2
Analyzing Cash Flow and Measurement
Organizations use cash-flow analyses to manage the amount of liquidity they want to maintain.
1) Identify the strategies and approaches organizations use to conduct a cash-flow analysis to
determine cash position and liquidity. 2) Explain why cash flow is important. 3) Support your
discussion with sources and cite them according to cu
ent APA guidelines. 4) Be sure to
critically evaluate the concepts and related literature. 5) Address any pro and con
arguments.
SCORING GUIDELINES
Analyzes course concepts, theories, or materials co
ectly, using examples or supporting
evidence.
Applies relevant professional, personal, or other real-world experiences to extend the dialogue.
Validates position with applicable knowledge.
Learning Components
This activity will help you achieve the following learning components:
• Describe best practices for managing funds in a nonprofit organization.
• Identify internal controls commonly used by nonprofit organizations to manage funds.
250 WORDS PARAGRAPH B UNIT 2
Direct and Indirect Costs
Organizations incur both direct and indirect costs. As your Budgeting and Financial
Management for Nonprofit Organizations text illustrates, direct costs are usually associated with
some type of objective cost (for example, a project, project staff, and supplies).
Indirect costs are normally not associated with these types of objective costs. Instead, indirect
costs contribute to the accomplishment of mission and goals, but are not directly tied to a
particular project or activity.
These different types of costs require different strategies for estimation.
1) Discuss the different approaches that can be used to estimate direct and indirect costs.
2) Support your discussion with sources and cite them according to cu
ent APA guidelines.
3) Be sure to critically evaluate the concepts and related literature.
4) Address any pro and con arguments.
Learning Components
This activity will help you achieve the following learning components:
Analyze best practices for financial accounting in nonprofit organizations.
Describe the types of funds commonly used by nonprofit organizations.
SCORING GUIDELINES
Analyzes course concepts, theories, or materials co
ectly, using examples or supporting
evidence.
Applies relevant professional, personal, or other real-world experiences to extend the dialogue.
Validates position with applicable knowledge.
Unit 2 XXXXXXXXXXCash Position and Cost Analysis
INTRODUCTION
As is the case with most organizations, money is the lifeblood for nonprofit organizations too.
Without sufficient resources, accomplishing the mission and goals of an organization becomes
impossible. This unit will focus on the management of cash and the determination of costs in
nonprofit organizations. Ample cash on hand may seem to be a good problem to have for most
organizations. However, knowing how to manage that cash efficiently and effectively is not
always intuitive or obvious. A major difficulty that nonprofit organizations encounter is the source
of their resources. Many of the resources managed and utilized by nonprofit organizations are
estricted in nature. This factor further limits the flexibility of the organization in managing its
money. Consider this issue as you explore cash management for nonprofit organizations.
This unit will introduce strategies for managing cash flow and liquidity within the restrictions and
limitations that nonprofit organizations face.
Studies
Readings
In your Budgeting and Financial Management for Nonprofit Organizations textbook, read the
following:
Chapter 3, "Liquidity and Managing Cash Flow," pages 51–68.
Chapter 4, "Costs and Cost Analysis," pages 69–87.
Use the Internet to read the following:
Me
ill Lynch XXXXXXXXXXHow to read a financial report [PDF]. Retrieved from http:
e145.stanford.edu/upload/Me
ill_Lynch.pdf
Optional Readings
You may find the following ebooks of interest as you explore the content in this unit. These
eadings are optional and are not required. Use the Capella University Li
ary to access them.
Francois, E. J. P XXXXXXXXXXFinancial sustainability for nonprofit organizations. New York, NY:
Springer Publishing Company.
McLaughlin, T. A XXXXXXXXXXStreetsmart financial basics for nonprofit managers. New York, NY:
John Wiley & Sons.
Learning Components
This activity will help you achieve the following learning components:
Describe common budgeting practices of nonprofit organizations.
Identify the key financial reports that describe the financial operations of a nonprofit
organization.