The Financial Stability of Nonprofit Organizations

Abstract This thesis evaluates the financial stability of nonprofit organizations and their ability to effectively facilitate the accounting functions of a business. Specifically, it focuses on the companies’ ability to maintain steady cash flow and fulfill all financial obligations while also achieving commitments stated in the company’s mission statement and core values. In addition, this analysis concentrates on the immense lack of knowledge and experience pertaining to financial management within many nonprofits as well as the scarcity of related trainings. As most administrators of nonprofits lack the proper training or background pertaining to financial oversight, there is often an imbalance in retaining steady funds while upholding the mission of the organization. Furthermore, suggestions and possibilities will be discussed and reviewed to examine how local organizations maintain their stability and to determine how other organizations can improve their financial situations. Multiple resource vehicles were utilized to acquire the foundational research for this thesis. A literary review is presented on previous research and studies regarding the subject of financial stability within nonprofits. These studies were obtained by means of scholarly search engines including google scholar and Ebsco. Additionally, a first-hand investigation is included of four local nonprofit organizations within the community. The investigation of the nonprofits involved interviews with the directors or an interview with the person who administrates the finances of the organization. While this thesis does not provide a thorough investigation of all aspects relating to nonprofit organizations, it does include an overview of the financial situations faced by many, as well the key issues and difficulties they may be familiar with. Furthermore, results from the interview process are cross-referenced with a summary of previous research in order to support or refute previous opinions