Quote:
Originally Posted by The Lucas
With the major electronics changes coming next year to all the different competitions, I am glad FIRST has more stored assets than normal. Hopefully everything works out flawlessly, but we all know this is rarely the case (remember Murphy's Law). FIRST may need to incur considerable costs fixing the problems, so it is nice to know they have the resources.
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Good thought! Even though in my post I did not defend the $8M cash reserves but instead the cost of entering the program, I thought I would do some research of my own.
Take a look at some of these articles (most of them are a quick read):
http://www.compasspoint.org/askgenie/details.php?id=65
http://www.nonprofitissues.com/publi.../point/67.html
http://www.nonprofitsassistancefund....Reserves06.pdf
and especially
http://www.proctorconsulting.org/cashreserves.html
So, it appears this standard procedure for many non-profits - after all, they need to have some cash flow to survive - and it seems as though the basic understanding is that FIRST is operating with as much cash-on-hand as they believe that they need in an emergency.
What's an emergency? Well, this year's tornado scare was a pretty big emergency. Imagine FIRST and FIRST's event management folks trying to reserve a new venue and get all considerations complete in just a few weeks (if it would have come to that). Imagine if something major went wrong with the Kit and a drastic, expensive change needed to be made last minute. Imagine if they needed to cancel a season of FRC for some drastic and terrible reason and refund all teams' money. Imagine if FIRST was sued.
So... I guess I'll be the first one to go out on a limb and say... hey FIRST Finance and Development folks, thanks for thinking ahead (and thinking of us).