Answer two questions that decide everything: is your shortage a matter of timing, money coming but not yet here, or a real gap between what you bring in and what you spend? And is your cash actually yours, or is some of it spoken for and only looks like room to breathe?
After you have a named finding, before you write your plan.
If the shortfall closes once the money you are owed arrives, you have a timing squeeze: the medicine is collecting faster and bridging the gap, not cutting programs. If it remains even after that money comes in, you have a structural deficit: you are spending more than you bring in, and cleaner books will only show it faster. If it mostly closes but a piece remains, treat the part that does not close as a deficit.
A structural deficit routes three ways: to the funding work for more revenue, to mission clarity and strategic direction for whether the work belongs here, and, where the answer may be no, to mergers, partnerships and restructuring.
A negative number is a red flag: it usually means restricted money has been spent on operations. If you see that, stop, make Master Restricted and Unrestricted Funds your first guide, and get a nonprofit accountant, because a spent restriction is a legal question, not only a management one.
A full version of the cash calculation lives in the True Available Cash Calculator in the restricted-funds guide. Feeds the Prioritized Financial Plan.
Your answers stay in your browser on this page and are never sent anywhere. Use Save or print to keep your copy.