...An Assessment of Corporate Cash Management Practices Author(s): Lawrence J. Gitman, Edward A. Moses and I. Thomas White Source: Financial Management, Vol. 8, No. 1 (Spring, 1979), pp. 32-41 Published by: Wiley on behalf of the Financial Management Association International Stable URL: http://www.jstor.org/stable/3665408 Accessed: 26-04-2016 11:33 UTC Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at http://about.jstor.org/terms JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org. Financial Management Association International, Wiley are collaborating with JSTOR to digitize, preserve and extend access to Financial Management This content downloaded from 202.79.21.43 on Tue, 26 Apr 2016 11:33:11 UTC All use subject to http://about.jstor.org/terms An Assessment of Corporate Cash Management Practices Lawrence J. Gitman, Edward A. Moses, and I. Thomas White Lawrence J. Gitman and Edward A. Moses are Associate Professors of Finance in the College of Business Administration at the University of Tulsa. I. Thomas White is a mechanical engineer with Mobil Pipeline Company in Dallas, Texas. The cost of preparation, distribution, and other clerical...
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...Procedure Cash Management Cash Management 1. DEFINITIONS............................................................................................................. 3 1.1. Cash Management ............................................................................................................................... 3 1.2. Cash Flow Analysis ............................................................................................................................. 3 2. SCOPE ....................................................................................................................... 3 3. TARGET/PURPOSE .................................................................................................. 3 3.1. Cash Management on plant/location level ........................................................................................3 3.2. Cash Management on group level ..................................................................................................... 3 4. CASH MANAGEMENT PROCESS ............................................................................ 4 4.1. Golden rule for cash and finance management at CO. ................................................................... 4 4.2. Cash Management Instruments ......................................................................................................... 4 4.3. Payment terms .............................................
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...Topic: AN ANALYSIS ON CASH MANAGEMENT AND ITS OPERATING CYCLE AT MARRIOTT HOTEL Submitted by SHRUTHI.H USN:1BF12MBA36 In partial fulfillment of the requirements for the award of the degree of MASTER OF BUSINESS ADMINISTRATION Mrs.Shaheen Shariff (Internal guide) (External guide) To Visvesvaraya Technological University Belgaum Department Of Management Studies BMS College Of Engineering, Bull Temple Road Bangalore-560 019 INTRODUCTION: Cash management is a broad term that refers to the collection, concentration and disbursement of cash. It encompasses a company’s level of liquidity, its management of cash balance, and its short-term investment strategies. In some ways, managing cash flow is the most important job of business managers. A company should aim at maximizing the wealth of its shareholders. In its endeavor to do so, a firm should earn sufficient return from its operation. Earning a steady amount of profit requires successful sales activity. The firm has to invest enough funds in current asset for generating sales. Current asset are needed because sales do not convert into cash instantaneously. There is always an operating cycle involved in the conversion of sales into cash. OBJECTIVES: * To analyze the Cash management and to determine efficiency in cash, inventories, debtors and creditors...
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...Cash Management: Cash is the most volatile and liquid Current Asset of Bank’s Balance Sheet and as such it demands special attention of Efficient Management. Cash Department plays most important role in creating good perception among the customers about the services of a bank. Cash in-charge, ideally a senior level officer with direct experience in cash management shall be responsible in performing good cash management. Good Cash Management constitutes the following roles. Receipt of Cash Before receiving cash from depositors in Pay-in-Slip / Credit Voucher the concerned cash official(s) shall: 1. Verify / check the (a) Title of Account, (b) A/C Number, (c) Amount in Words and Figures, (d) Date, etc. written on Pay in Slip / Credit Vouchers with the records of computer program and shall satisfy on their correctness and genuineness. 2. Carefully check and Count the Currency Notes 3. Write down denomination 4. Affix Cash Received stamp 5. Make entry of particulars of the Cash Received 6. Verify entries / Particulars of Pay-in-Slip / Credit Voucher with those of the Cash Receiving Register 7. Keep Cash in the Drawer of Cash Counter under lock and Key (within Counter limit) during transaction hours. Payment of Cash While Paying Cash against debit instruments namely Cheques, Demand Drafts (DD), Pay Order (PO), Pay Slip (PS), SDR, FDR, etc. and also against other debit instruments issued under scheme deposits of the Branch as well as Cash Debit Vouchers, the following...
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...easy as one two three. An interested owner that deals with selling of pharmaceutical products need determination to operate business, the guts to get it going, the power to motivate his employees and the financial commitment to make it happen. You should also be competitive, a positive thinker and a goal minded person in order for you to make the business successful. One of the ways to be successful in business is to manage the cash properly and wisely. Cash management is a marketing term for certain services offered primarily to larger business customers. It may be used to describe all bank accounts (such as checking accounts) provided to businesses of a certain size, but it is more often used to describe specific services such as cash concentration, zero balance accounting, andautomated clearing house facilities. Sometimes, private banking customers are given cash management services. Cash management is a broad area having to do with the collection, concentration, and disbursement of cash including measuring the level of liquidity, managing the cash balance, and short-term investments. If at...
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...Cash Management Modeling, Excel Assignment 3 Cash Management Modeling, Excel Assignment 3 Cash flow forecasts are a powerful management tool to help identify future deficits or surpluses in liquidity. The cash flow forecast shows the total expected outflows and inflows during a given period; i.e. a year. It is vitally important that this budget is prepared so the organization is aware of shortages and surpluses during the year. These can help the business spot cash problems and cash opportunities. A known cash shortage can be planned for and resolved proactively verses reactively. It would be wrong to assume that if the organization is in surplus that it does not have a problem. Idle cash means the opportunity to earn interest or profitable investment is lost (Investopedia, 2012). Lakewood Laser Skincare For Lakewood Laser Skincare and all business cash budgets really do matter. The business owner who does not pay attention might have a rude surprise when they run out of cash or applies to the bank for renewal of loans. One of the many advantages of utilizing Excel financials or an accounting software program is that updating is calculated automatically by simply completing a new data input. This helps business owners quickly get a handle on the financial strength and capabilities of their business. Creating and Calculating Cash Balances Sheets The first step in creating a multiproduct, multi-period, spreadsheet-based budget is setting up a clear and understandable Data...
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...Management of Float of Cash Management Acknowledgement The Success of any research study depeneds upon various factors. This project is the outcome of the efforts of several people, apart from the team members, and it is important that their help be acknowledgement here. First of all we want to present our sincere gratitude and deep appreciations to Prof. Nandita Mishra for helping us and carefully guiding us during the course of the project. Without motivation, a person is literally unable to make his best effort. We are highly grateful to him for his guidance as he played an important role in preparing us for industrial culture and making us aware of actual scenario and work culture in organization. Our acknowledgements would remain incomplete if we fail to express our sincere gratitude and love to our friends, colleagues who’ve helped us at several instances to collect valuable matter regarding the project, and most important to our family members for being there for us. Without their support and encouragement, this work would not have been possible. Ekta Varshney(072) Fatima Zeenat(073) Mohd. Muzaffar Alam(107) Certificate This is to certify that the project entitled “Management of float of cash management”, which is being submitted by Ekta Varshney, Fatima Zeenat, Mohd. Muzaffar Alam, students of PGDM, IMS-Ghaziabad is a record of candidates own work carried by her under my...
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...Cash management is a need common to both large and small businesses alike. In its simplest terms, cash management is the assurance that today's receivables plus today's account balances exceed today's payables. Failure to practice this business management process guarantees bankruptcy. Every large organization has a cash management group, sometimes called the treasury. This group's function includes management of such items as investments and borrowing in addition to the organization's daily cash flow. In small to medium businesses (SMBs), usually the chief financial officer (CFO), president, or owner performs the task of cash management. Regardless of a company's size, the important thing is that cash management is practiced on a regular basis—at least weekly—and with sufficient attention to details. In difficult times, when liquidity is "tight" (at a minimum), it should be performed daily. Crucial to organizations' successful cash management are the deals they make with their financial institutions for short-term placements and for borrowing funds. Unlike in other countries, in the United States, a bank account that is credited with deposits does not begin to earn deposit interest until three business days have passed. Furthermore, an American business account specifically may not be overdrawn, which necessitates cash management to be the most important activity of a business's financial management. For all companies—and in particular, public traded companies—major...
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...FACULTY OF ACCOUNTACY, FINANCE AND BUSINESS BACHELOR OF ORPORATE ADMINISTRATION (HONOURS) BBBD 3014 CORPORATE GOVERNANCE COURSEWORK ONE ACADEMIC YEAR 2015/2016 KUA YUN XIN 13WBR09901 3RCA10 (SEMESTER 3) WORD COUNT: 4200 WORDS TITLE: GENDER DIVERSITY OF BOARD COMPOSITION IN MALAYSIAN BANKING INDUSTRY PLAGIARISM STATEMENT & MARK SHEET Bachelor of Business (Honours) in Corporate Administration YEAR 3 ACADEMIC YEAR 2015/2016 BBBD3014 CORPORATE GOVERNANCE Coursework I PLAGIARISM STATEMENT I, Name: Kua Yun Xin Registration Number : 13WBR09901 Signature: confirm that the submitted work is my own and is in my own words. 3RCA Tutorial Group10 Semester 3 Date: 15 July 2015 MARKING SCHEME | % | | | | Maximum | | Evaluation of frameworks, values and governance practices of listed company or companies in the Malaysian context | 30 | 30 | | Application of knowledge and analytical skills relating to legal compliance, best practices and guidelines for achieving business and governance goals | 10 | 10 | | Synthesis, implementation and development of strategies in achieving world-class governance | 20 | 20 | | Total | 60% | 60 | | Tutor’s Comments: ………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………...
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...Cash Management Article Review October 2, 2012 Section 1: Original Work Statement I, xxxxxxxx, verify that this article review is solely my own work and creation and it has been prepared solely for credit in this class. Section 2: Article Citation Serena, N. and Tuna, C. (August 31, 2009). Big Firms are Quick to Collect, Slow to Pay. Wall Street Journal (page 1). Section 3: Main Issue of Article This article was very important and was exposed to many readers because it made the front page of the Wall Street Journal in 2009. The authors wanted to inform their readers of a cash management development that a number of credit professionals had recognized a long time ago but wanted to expose the issue to more financial professionals and the multitudes that read the Wall Street Journal. Big companies have sped up efforts in collecting money and at the same time have slowed down their payments to suppliers, vendors and money owed back to customers. Big firms are quick to collect and they are slow to pay (Serena). This concept must be understood as these big companies are fine tuning and sneakily finding ways to squeeze as much cash flow as possible out of operations and small businesses in which they use. An important statistic that came out of the article exposes the fact that companies with annual revenue in excess of more than $5 billion are collecting bills on the average of 41 days in 2009 down from 42 days in 2008. The same companies are taking...
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...The three banks that were researched for their money management services were, Citi Bank, Chase, and Banner Bank. These three institutions gave a wide view of the services that they would be able to provide to a potential customer and how it would best serve their business. Citi Bank states that with their, “cash management products, you can collect payments faster, optimize the timing of payments to suppliers, vendors and employees, and stay on top of your accounts and balances more easily.” This is followed by a wealth of information about the different services that are provided under cash management. They have services that include, speed up receivables that are merchant services, remote check deposit, and business lockbox. Merchant services are a faster alternative to allowing customers to purchase your goods or services. Remote check deposit shows you electronic images of deposited checks with easier reconciliation of discrepancies. Business lockbox allows Citi Bank to receive checks on your behalf and deposit them according to your specific instructions. Their cash management services also include control payments, which are, payroll manager, business credit cards, business debt master cards, wire transfers, controlled disbursement, and business online automated clearing house origination. Payroll manager allows you to quickly and efficiently calculate your businesses payroll so you can pay your employees and file payroll taxes. Business credit cards and the business...
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...Assignment 1: LASA 2—Cash Management and Budgeting Click below link for Answer http://workbank247.com/q/assignment-1-lasa-2cash-management-and-budgeting/4017 Assignment 1: LASA 2—Cash Management and Budgeting The new owner of Bob’s Boats, Bob, just purchased the business and discovered that the prior owner did not have a plan for managing the current assets of the company. Bob has decided that the place to start is with a cash budget, using the template he used in his prior position. Click here to download the Excel template for this assignment. Bob has requested that you to complete the cash budget given the data that he has already retrieved from the company’s records and from his own analysis. Table-1: Sales Forecast for the next 9 Months | Month | Sales | | January | $ 162,000.00 | | February | $ 168,000.00 | | March | $ 324,000.00 | | April | $ 485,000.00 | | May | $ 648,000.00 | | June | $ 325,000.00 | | July | $ 325,000.00 | | August | $ 80,000.00 | | September | $ 162,000.00 | | Collections on receivables have historically been collected as follows and this pattern is expected to continue: * 12% in the Month of Sale * 60% in the month following the Sale * 28% in the Second Month after the Sale Bob pays for the labor and materials in the month after they are incurred. Bob has also compiled the following information on expenses for the upcoming nine month period: Table-2: Month | Labor and Materials Expense...
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...Cash Management Angelia Wilkerson Argosy University Cash Management Norma’s is in a position to restructure the company’s cash flow. If the new system works, it will make more cash available for possible investments. Electronic advances in technology, such as ACH payments, allows for a reduction in float time. Mail float refers to the time delay of collections due to the amount of time payments spend in the mailing process and clearing float is the time it takes for payment checks to clear through the banking system. (Block, 2014) These automated systems also makes it easier to send payments to creditors within a more narrow time-frame; hence the possibility of a half-day deferment in Norma’s case. Question: Norma’s Cat Food of Shell Knob ships cat food throughout the country. Norma has determined that through the establishment of local collection centers around the country, she can speed up the collection of payments by two and one-half days. Furthermore, the cash management department of her bank has indicated to her that she can defer her payments on her accounts by one-half day without affecting suppliers. The bank has a remote disbursement center in Iowa. a. If the company has $5 million per day in collections and $3 million per day in disbursements, how many dollars will the cash management system free up? Justify your answers. b. If the company can earn 8 percent per annum on freed-up funds, how much will the income be? Justify your answers...
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... Express Local Collection CMS Collection Products CMS Procedure Services Correspondent Bank Client Acquisition Process Host to Host Connectivity CMS Structure Disbursement Customer Benefits Operational Constraint Need for CMS Branch Responsibility What is CMS 2. • In a geographically large country like India having a complex financial clearing system, corporate find it increasingly challenging to process collections CMS is the process of optimizing receivable and payables ensuring predictability in the cash flows of CMS clients.3. & Cash Management thus means getting funds in time, quick transfers, quick realization of local and outstation instruments, easy disbursements, accounts reconciliation, controlled processes and customized MIS.payments across dispersed business locations. • Difficulty in collecting data / MIS on the funds collected Increased borrowing and associated costs Uncertainty in cash flows Delays in cash realizations Complex clearing system Geographical spread of the country4. • Pooling of funds • Funds collected Assured Credit • Availability of cleared funds variable • Depends on type of cheque viz. Local/Outstation(Branch/Non branch) • Customer gets credit after fixed number of days once instruments are picked up, even if bank is not yet in funds5. & deposited in Central Account • Instruments picked up at various locations, sent to appropriate clearing houses, funds collected & Control Benefits • Corporate to maintain...
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...ARTICLE REVIEW ON “A TIRED APPROACH ON CASH MANAGEMENT” SUBMITTED BY: Himanshu Chauhan REGD NO – 1321516 MBA – General Management A TIRED APPROACH TO CASH MANAGEMENT Title: A Tired Approach to Cash Management. Author: Oliver Denecker, Senior Knowledge Expert. Source: McKinsey on Payments. Date: June, 2010. Abstract: Article explains about the effective management of cash in business activities in this financial crisis. The various decisions to be considered by the biggest banks for better investing in cash management helps the banks to accelerate the revenues. The cluster effect strategic decisions are considered for established markets to offer a comprehensive range of basic cash management services to small and medium enterprises and mid – market and public – sector customers. A tired approach for cash management providers help the companies accelerate the collection of receivables and to control the payments to trade creditors and to efficiently manage cash services are briefly explained. Summary: Banks are setting ambitious targets for cash management growth by launching new cash management services in the markets. It requires well planned strategic thinking to know the market landscape. The strategies implemented by biggest banks are via mergers and acquisitions which helps the banks to widen the gaps between first and second – tier players. The competition in the market is much higher which lead to implement effective strategies over number of regional...
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