The Cash Flow Solution: The Nonprofit Board Member's Guide to Financial Success [Paperback]

Richard S. Linzer (Author), Anna O. Linzer (Author)

Book Description

Publication Date: November 17, 2006

Many nonprofits rely on conventional methods of making and managing money—from donations to cash reserves, endowments, and capital building campaigns—in hopes of securing financial stability for the future. Yet these acquired funds often remain tantalizingly out of reach for day-to-day operations; the balance sheet may look good, but the actual cash available is often surprisingly low.

In order to achieve their missions, nonprofits need to fundamentally change the way they think about money. Richard and Anna Linzer introduce a groundbreaking approach to nonprofit financial management based on cash flow and the use of credit that gives nonprofits the money they need, when they need it while ensuring the long-term financial well-being of the organization. Their revolutionary and effective financial model is explained in clear and understandable terms for decision makers in both large and small nonprofit organizations.

"The Linzers are revolutionaries in the nonprofit financial world and leaders should take notice!"
--Martha J. Perry, associate executive director, McCune Foundation

"A great book for any board member of a nonprofit organization."
--Michael Schlesinger, attorney, author, lecturer, and commentator in the field of taxation

"Nonprofits now have a choice: Muddle along from crisis to crisis or follow the advice in this excellent, innovative book."
--Irene Y. Namkung, past board president, the Western Arts Alliance, Northwest Folklife, and Oregon Potters' Guild

"It's heresy, but it works. The Cash Flow Solution presents solid steps to financial sanity in the nonprofit boardroom."
--James A. Kolb, West Sound Academy

"From time to time a book makes so much sense you wonder why someone did not write it a long time ago. Richard and Anna Linzer's book "The Cash Flow Solution" is such a book. The principles are as fundamental and rock-solid as they are innovative. Applying their suggestions could help many troubled organizations survive and thrive. More importantly, the Linzers' insight could lead many nonprofits in coming closer to fulfilling their potential to deal with the many needs of our society."

--Mike Pedretti, Artistic Director and President, Movement Theatre International

Editorial Reviews

Review

"The Linzers are revolutionaries in the nonprofit financial world and leaders should take notice!"
—Martha J. Perry, associate executive director, McCune Foundation

"A great book for any board member of a nonprofit organization."
—Michael Schlesinger, attorney, author, lecturer, and commentator in the field of taxation

"Nonprofits now have a choice: Muddle along from crisis to crisis or follow the advice in this excellent, innovative book."
—Irene Y. Namkung, past board president, the Western Arts Alliance, Northwest Folklife, and Oregon Potters' Guild

"It's heresy, but it works. The Cash Flow Solution presents solid steps to financial sanity in the nonprofit boardroom."
—James A. Kolb, West Sound Academy

From the Back Cover

Many nonprofits rely on conventional methods of making and managing money—from donations to cash reserves, endowments, and capital building campaigns—in hopes of securing financial stability for the future. Yet these acquired funds often remain tantalizingly out of reach for day-to-day operations; the balance sheet may look good, but the actual cash available is often surprisingly low.

In order to achieve their missions, nonprofits need to fundamentally change the way they think about money. Richard and Anna Linzer introduce a groundbreaking approach to nonprofit financial management based on cash flow and the use of credit that gives nonprofits the money they need when they need it, while ensuring the long-term financial well-being of the organization. Their revolutionary and effective financial model is explained in clear and understandable terms for decision makers in both large and small nonprofit organizations.

"The Linzers are revolutionaries in the nonprofit financial world and leaders should take notice!"
—Martha J. Perry, associate executive director, McCune Foundation

"A great book for any board member of a nonprofit organization."
—Michael Schlesinger, attorney, author, lecturer, and commentator in the field of taxation

"Nonprofits now have a choice: Muddle along from crisis to crisis or follow the advice in this excellent, innovative book."
—Irene Y. Namkung, past board president, the Western Arts Alliance, Northwest Folklife, and Oregon Potters' Guild

"It's heresy, but it works. The Cash Flow Solution presents solid steps to financial sanity in the nonprofit boardroom."
—James A. Kolb, West Sound Academy

See all Editorial Reviews

Product Details

• Paperback: 160 pages
• Publisher: Jossey-Bass; 1 edition (November 17, 2006)
• Language: English
• ISBN-10: 0787978337
• ISBN-13: 978-0787978334
• Product Dimensions: 6.1 x 0.4 x 9 inches
• Shipping Weight: 4.8 ounces (View shipping rates and policies)
• Average Customer Review: 4.5 out of 5 stars  See all reviews (2 customer reviews)
• Amazon Best Sellers Rank: #1,584,568 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

3 of 3 people found the following review helpful:

5.0 out of 5 stars Every nonprofit manger and board member must read this book, May 6, 2007

By 

Michael Pedretti (Falls Township, PA, USA) - See all my reviews
(REAL NAME)   

This review is from: The Cash Flow Solution: The Nonprofit Board Member's Guide to Financial Success (Paperback)

From time to time a book makes so much sense you wonder why someone did not write it a long time ago. Richard and Anna Linzer's book "The Cash Flow Solution" is such a book. The principles are as fundamental and rock-solid as they are innovative. The Linzers' understanding of the assumptions that get in the way of effective money management by nonprofit managers and board members is grounded in fact and experience. Applying their suggestions could mean the survival of many troubled organizations. More importantly, the Linzers' insight into the use and abuse of endowments could lead to substantial improvements of nonprofits to come immediately closer to meeting their potential to deal with the needs of our society.

First the Linzers' demonstrate the inappropriateness and dangers of traditional financial reports where fund balances are based on the difference of assets and liabilities. They show conclusively that this way of thinking not only makes no sense for a nonprofit organization, but in fact can lead to destructive choices. Then they make an irrefutable case for the value of cash flow reports and projections. They put it succinctly, "the fiscal cycle for a nonprofit organization is only about cash flow." While assets can make or break a for-profit organization, "The Cash Flow Solution" demonstrates that, in a time of need, assets are often worthless for a nonprofit organization. Not only do they make the case for the functionalism of the cash flow solution, they also provide simple, easy to comprehend, step-by-step methods to transpose less than meaningful asset/liability fund accounting to a cash flow system.

The Linzers make a strong and reasoned case for using a line-of-credit as a relatively cheap source of cash for seasonal and/or temporary needs. Then they provide a detailed fail-proof means of obtaining a line of credit from banks, most of whom are unnaturally afraid to provide loans to nonprofits.

The most important and the most innovative insight in the book is the need for nonprofits to kick the habit of endowment and capital campaigns. The authors assert that these funds are the scourge of nonprofits, giving organizations a false sense of security, leading to mistakes in fiscal decision making, doing nothing to assure the future of the organizations they are meant to protect. In addition, by taking large chunks of funds away from services, the Linzers point out that massive capital contribution campaigns by large institutions crowd out donations to smaller organizations that also play important roles in the community. The crippling or loss of these small organizations is part of the price we pay for endowment and capital campaigns. If the world will listen, the Linzers' message could do more to make nonprofits better meet their mission in our society than any single act.

Every director of a nonprofit in America must read this book and it should be required for their board members, as well. In addition, "The Cash Flow Solution" should appear on the syllabus of every college nonprofit management program in the country.

2 of 2 people found the following review helpful:

4.0 out of 5 stars worthwhile, September 4, 2008

By 

anonymous - See all my reviews

This review is from: The Cash Flow Solution: The Nonprofit Board Member's Guide to Financial Success (Paperback)

The authors challenge the dreams of many non-profits -- cash reserves and endowment -- and focus on the nonprofit as being a truly cash flow entity. They describe the operations of nonprofits versus the business sector and provide some good insights helpful for board members.