Cash Management Tips for Your Budget Season

As fiscal year-end approaches, Non-Profits, Educational Institutions and Governmental entities are used to having collaborative meetings to tackle the challenges that this time of year normally presents. However, COVID-19 has caused significant changes in normal operations. One of the biggest challenges facing leaders is cash management and this should continue to be in the forefront as you contend with these unprecedented times. The following are some ideas and planning tools that Non-Profits, Educational Institutions and Governmental entities can use to improve cash flows.

Cash Management Planning for Year-End
  • Review Payables on a Daily Basis – Determining what payments are due and when they are due can help plan for shortfalls. Reviewing the payables due in conjunction with cash balances can also help determine if requests for deferral of payments need to be made. This is also a time to look at budgets and any possible areas where costs can be cut. Zero-based budgeting is an exercise typically done every three to five years. Consideration should be given to looking at this for the upcoming fiscal year. Regarding cost cutting, maintenance and nonessential expenditures planned over the next three months should be reviewed for any deferral opportunities.
  • Contact Vendors Regarding Payment Terms – Given the lingering economic implications regarding COVID-19, remember to notify vendors in advance if you know you may be behind on a payment. This is helpful if you believe you will need to request a waiver of interest and penalties or an extension to pay.
  • Submit Invoices and Reimbursement Requests Timely – It is always important that invoices and requests for reimbursements be submitted timely in order to accurately forecast cash outflows. However, the current times necessitate the need to even more closely monitor cash balances. This monitoring could include entities mandating that invoices and reimbursement requests are submitted timely and also consider an earlier than normal cutoff date for these transactions to be processed in FY 2021. Also, be proactive in negotiating payment terms with your grantors to decrease the lag time on reimbursements.
  • Review Actual and Projected Receipts on a Daily Basis - The review of actual receipts can help with the calculation of cash yet to be received. A combination of discussions with your major revenue providers and data analytics is key to projecting cash receipts. Now is the time to communicate with your top revenue source providers and explain what you are doing to manage costs, stay on mission and help your employees. It’s also an opportunity to ask for their feedback and inquire about their ability to meet their funding commitments. For Higher Education institutions, most monies for students would have been received for the spring semester; however, bills for the upcoming summer and fall semesters have either been already sent or will be sent soon, so it is important to reconcile monies received to monies owed. Of course, any adjustments for online classes should be factored in, offering an opportunity for increased collaboration with the education and student housing staff regarding changes that may be taking place within their areas. Any credits owed to students for room and board charges that are being adjusted due to COVID19 should be factored in to the analysis of receipts.
  • Complete a Daily Cash Reconciliation – Once current and expected payables, current and expected receipts, credits owed and cash balances have been analyzed, there should be a daily exercise to project the cash balance. Doing this on a daily basis is another way to make sure cash is managed properly.
  • Identify Other Sources of Liquidity – Consider obtaining or increasing your line of credit. Keep your lender informed to avoid surprises.
Staying Connected

As we navigate working from home and begin to plan to return to our offices, a good way for staying in touch continues to be virtual meeting tools, such as ZOOM. Collaboration is critical for successful cash management, and virtual meetings are a way to accomplish this as we navigate these times of increased isolation.

What’s Next?

Whether you are a Non-Profit, Educational or Governmental Entity, COVID-19 is presenting unique challenges. For questions or more information on the cash management tips offered in this article, contact us at or reach out to your contact below.


Mark Nicolas
Managing Partner, Non-profit, Education & Government

Randy Sherrod
DHG Risk Advisory


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