Business Questions Essay

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New Philanthropy Foundation (NPF) Steve Dawes founded the New Philanthropy* Foundation (NPF) in 2005. It was set up with a very generous donation from a retired businessman. It is an online non-profit organization financing educational opportunities for children in developing countries. Steve has been looking at his financial statements with concern. NPF’s cash reserves are being used up quickly and in the current poor economic climate, NPF’s main source of finance – online donations – is falling. In 2010, NPF has no debt but also no fixed assets. NPF’s outgoings are Internet usage fee, maintenance fee for servers and computers as well as a web designer’s fee for regularly updating the NPF web site. NPF has volunteers from all over the world running the organization. An online community of social networking web sites connects them with Steve as the chief web site administrator. All funds to finance educational projects are transferred electronically and only e-mail communication is allowed. According to its vision statement, NPF aims to become the first paperless charity. Steve has been asked by a very popular rock band to sponsor a reunion concert, which will be broadcast only over the Internet. The opportunity would generate substantial public relations possibilities, but some volunteers on the NPF forums are not convinced. They argue that the money spent sponsoring the concert should be used to provide further educational opportunities for children. They also believe that many people watching the concert may be frustrated if global Internet broadband connections become too slow or fail. Steve is preparing a cash-flow forecast for the next six months (all figures refer to 2010) based on the following figures: Forecast | Donations (millions

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