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The Importance of Operating Reserves

Gelman, Rosenberg & Freedman CPAs is a member of CPAmerica International, an association of CPA and consulting firms that provides industry knowledge including insightful articles, to help member firms serve clients and other individuals and organizations.

“What is an operating reserve, and why does every nonprofit need to address this issue?” In this issue of Accounting and Audit Advisor, Gelman, Roseberg & Freedman’s Amy Boland provides advice on the importance of nonprofit operating reserves as well as how nonprofit boards can determine the most appropriate size of reserves for their organizations.

Included in this article is a comparison between operating reserves and other unrestricted funds, the factors nonprofit boards and executives should consider when making decisions about their operating reserves, and the effects operating reserve levels can have on fundraising capabilities.


"Gelman, Rosenberg & Freedman CPAs (GRF), understand our work. We love working with GRF because they are consummate professionals who believe in really getting to know what we do."

Tharangi Cumaranatunge |  Finance Controller
The American Refugee Committee