texascpa
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- Aug 26, 2011
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For cash flow purposes they are going to borrow the money but the AD has the money to pay for these upgrades.
Without looking at the books I am sure the school puts a lot of money into CDs and mutual funds and other investments. So while they have the money to pay without borrowing all transactions involving this amount of money involve banks and borrowing.
This project though is pretty much fundraised money.
Good to know. Though, they probably have it in rate swaps, commercial paper, and long-term bonds, not CDs and mutual funds.