Managing liquidity--a college or university's ability to access cash quickly or to easily convert assets to cash--is an increasingly crucial component of enterprise risk management. Liquidity risks lurk around nearly every corner--in the endowment portfolio, the debt portfolio, and in working-capital management. It also influences students' abilities to pay tuition, the federal government's ability to reimburse research and medical center costs in a timely manner, states' abilities to support their universities, and donors' abilities to live up to agreed-upon pledge schedules. Given its importance to financial stability, managing liquidity is a topic deserving of increased and sustained attention from board members. In fact, within each institution, operating budgets, capital budgets, and balance sheets should be linked together through a singular focus on liquidity. Such a focus on liquidity or cash flow has often been absent in the past. Today, however, the pendulum seems to be swinging back almost 180 degrees, as many institutions are seeking to reduce their risk and increase their liquidity positions, sometimes dramatically. For example, some boards have instructed their institutions' treasurers to maintain high operating cash balances; others have called for investing working capital only in U.S. Treasury bills. However they approach it, boards must increasingly pay attention to how their institutions plan and predict cash flow. While a focus on liquidity is crucial, it's also important to note that one must not lose sight of strategic objectives. Cash hoarding or focusing singularly on minimizing risks incurs opportunity costs. It can lead to a critical kind of "shortfall" risk: the failure to meet institutional goals. Thus, while there are costs attending too little liquidity, there are also costs attending too much liquidity. A key role of boards is working explicitly with administrators to find the right balance.