Overview
A nonprofit providing services to individuals and families impacted by the criminal legal system faced escalating financial challenges that threatened its operational continuity. Carey & Co stepped in to systematically address these issues, restoring financial health and ensuring sustainable management practices for the future.
Challenge
The nonprofit was grappling with systemic financial inefficiencies and severe cash flow problems, exacerbated by high turnover in executive leadership. With the recent departures of the CEO and COO, a newly promoted CEO was thrust into navigating a complex landscape of operational and financial uncertainties. Critical issues included delayed payroll processing, inefficient invoicing practices, and challenges in collecting Medicaid reimbursements and grant funding. As a result, the nonprofit had to rely on advances from reimbursement grants to cover short-term expenses—a temporary solution that further stressed cash flow.
The organization was essentially operating week to week, living off these advances, and unable to track or manage cash flow effectively. These issues were further complicated by compliance gaps and a lack of institutional knowledge, making it difficult for the organization to manage payables and sustain operations effectively. Absent of a clear financial roadmap and the ability to assess cash flow in real-time, leadership struggled to make informed decisions, placing the organization’s financial health in jeopardy.
Solution
During their financial review, Carey & Co uncovered critical financial oversights that hindered the nonprofit’s ability to manage cash flow. One of the most pressing issues was that the organization had not yet applied for forgiveness of their outstanding Paycheck Protection Program (PPP) loans, resulting in accruing interest. They acted quickly to secure $3.6 million in PPP loan forgiveness for the nonprofit, eliminating a major liability and easing financial pressure.
On the Medicaid side, they identified billing inefficiencies, knowledge gaps, and outdated compliance practices that hindered the organization’s ability to collect reimbursements effectively, often resulting in the need to return funds due to noncompliance. After a comprehensive financial analysis, Carey & Co made the data-backed recommendation to discontinue the financially unsustainable Medicaid program.
They also brought in Bill.com and integrated it with the nonprofit’s existing solution, Blackbaud Financial Edge, to allow leadership to better monitor accounts payable in real time, track outstanding invoices, and prioritize vendor payments.
Results
With Carey & Co’s guidance, the nonprofit stabilized its finances and radically improved operational efficiency. By securing $3.6 million in PPP loan forgiveness, the organization significantly reduced its financial burden and minimized mounting interest payments. Additionally, the decision to discontinue the Medicaid program prevented further losses and allowed leadership to redirect resources toward more sustainable operations.
Integrating Bill.com gave the organization real-time visibility into financial operations, streamlining payment processing, improving invoice management, and accelerating grant funding collections. Coupled with stronger internal controls and more informed decision-making, these changes transformed a week-to-week cash flow challenge into a predictable, month-to-month system.
Carey & Co also clarified financial processes and fostered a more strategic financial approach, strengthening internal trust and enhancing reporting. With greater financial stability, the leadership team can plan more effectively, reduce reliance on short-term advances, and ensure long-term sustainability.