CAI-NJ May 2019 (w)

ances can cause your cash balance to become misleading. For example, while the balance in operating cash as compared to accounts payable may appear positive, significant inter- fund balances due from operating to other funds can cause operating cash flow to actually be negative. Aside from cash flow purposes, the IRS requires capital reserve funds be FINANCIAL STATEMENTS... from page 20.

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“There are other factors that can have a negative impact on an association’s cash balance.”

separated from other funds, and not comingled with operating cash. There are other factors that can have a negative impact on an association’s cash balance. Two common fac- tors include extensive unanticipated/ unbudgeted operating expenses and higher delinquencies in a particular month. Being aware of these factors will better allow boards and property managers to plan accordingly so that general operating services continue uninterrupted and that reserves are

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