Nonprofit Cash Flow Management
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Transcript of Nonprofit Cash Flow Management
Nonprofit Cash Flow Management
June 28, 2011
Virginia National Bank Treasury Management Team
Steve Krohn – EVP and Managing Director
Ginger Germani – TM Officer
Carrie Gillispie – TM Representative
Brooke Jenkins – Merchant Card Representative
What Can Cash Flow Management Do for You?
Now that you have this information, how do you make it more valuable day to day for your organization?
• Goals• Tools• Obstacles/Barriers
Banking Tools to Save Time, Lower Costs & Increase Efficiency
Banking Tools to Save Time & Increase Efficiency
• Business Online
• Deposit Online
• ACH Transactions
Business Online
Business Online allows you to:
• View account balances and transaction details
• See current day deposit information
• Schedule future and recurring transfers between accounts
• Initiate direct deposit of payroll
Deposit Online – (Carrie)
Deposit Online enables you to:
• Save staff time by eliminating unnecessary trips to deposit checks
• Speed up your access to funds through timely, daily deposits
• Create your own check images and data
Deposit Online
ACH Transactions
ACH Payments are simply electronic transfers to or from one account and another account, even at another bank.
Common uses are:
• A donor makes regular, recurring contributions on a monthly or quarterly basis
• A customer pays service provider, such as utilities or rent
• Employer direct deposits payroll to employees
• Business pays supplier for products
ACH Transactions
ACH Transactions
Reducing Online Banking and Transaction Fraud Risks
Reducing Online Fraud Risk
• Dedicated “banking” computer
• Online authentication tools (i.e. tokens)
• Dual approval to move funds
• System level & User level transaction limits and service entitlements
Reducing Online Fraud Risk
Reducing Transaction Fraud Risks
• Required 48 hour bank notification
• Check Positive Pay
• Positive Pay Payee Verification
• ACH Positive Pay
Transaction Fraud Statistics
Association for Finance Professionals (“AFP”)
2011 Payments Fraud and Control Survey
http://www.afponline.org/pub/res/topics/topics_pay.html
Underwritten by J.P. Morgan and available generally from AFP at no charge once you’re a registered website user.
Transaction Fraud Statistics
Transaction Fraud Statistics
Merchant Processing Technology
Merchant Processing Technology
• Customization Capabilities
• Online Capabilities
• On-Site Event Capabilities
Merchant Processing Technology
Merchant Processing Technology
Merchant Processing Technology
Cash Planning
Cash Planning
• Understanding the FDIC limits
• CDARS
• Know Your Cash Flow
• Layering
• Laddering
FDIC Limits
• The FDIC insures up to $250,000 per entity in any one FDIC insured institution.
• Currently (June 28th, 2011) the FDIC provides unlimited coverage on deposits in non-interest bearing accounts.
• The FDIC no longer offers unlimited coverage on interest bearing accounts, as it did from 2008-2010.
CDARS
• CDARS (Certificate of Deposit Account Registry Service).
• Insures CDs up to $50,000,000.
• Provides higher rate than Treasuries.
• Approved for use by municipalities in 2007.
• One monthly statement, one 1099 for tax reporting.
• Less time spent tracking CDs spread all over town.
Know Your Cash Flow
• Monthly operating cash.
• Forecast funds based on business cycles, campaigns & large expenditures.
• What works this year will not always be the case next year.
• Is your current account structure manageable and is it making your organization the most money?
Layering Funds
• What types of accounts do you use and what benefit are you deriving from them?
• Use of multiple accounts can help you achieve greater interest earnings and is easy.
Layering Funds
Single Account Structure
• Interest Checking $75,000 0.20% = $150 annually, or 0.20%
________________________________________________________
Layered Accounts
• Interest Checking $10,000 0.20%• Phoenix (3 year rate) $15,000 0.45%• Funds Management CD $50,000 1.05% = $600+ annually,
or 0.82% with funds rolling every 30 days to 6 months and with even more on the line as rates increase
Laddering Funds
• Finding comfortable and rewarding maturities.
• Flexibility vs. Profit. What do you need and on what horizon?
• CDARS can be an excellent way to handle endowments.
TM Contact Information
Steve Krohn – EVP and Managing Director TM & Private Banking
• [email protected] or 817-8648 or cell 987-4600
Ginger Germani – TM Officer
• [email protected] or 817-8622 or cell 987-6198
Carrie Gillispie – TM Representative
• [email protected] or 817-8655 or cell 906-9290
Brooke Jenkins – Merchant Card Representative
• [email protected] or 817-8650 or cell 987-6202
Thank you