The Key to Long Term Financial Health: Liquid Unrestricted Net Assets (LUNA)
Written by Hilda Polanco for the New York Nonprofit Press. Published on May 25, 2012. Hosted at the Wallace Foundation, and included as part of their StrongNonprofit Toolkit. Accompanied by the “Calculate Your LUNA” Excel tool.
“Everyone knows that these have been difficult times for nonprofits. Our own research… and countless other surveys by intermediaries and industry associations find that nonprofits have been struggling with cutbacks in government funding, reduced corporate and foundation grantmaking, and weakened individual giving.
“These fiscal pressures have led, in many cases, to annual operating deficits and emergency use of endowment funds or other financial reserves – if nonprofits had any to begin with. While there is widespread agreement about the general problem, many individual nonprofits still need strategies and solutions for conducting a realistic assessment of their own financial situations and to implement budgetary and financial management strategies appropriate for the still very perilous times ahead.”
