The key to obtaining structure requires reporting of funds which are invested. In a company such as True Value, many companies must actively find ways to reduce the lost of cash throughout its infrastructure, especially when the company is established within a competitive market. With many companies at the brink of bankruptcy, cash management is a way to control accounts and manage accounts more effectively. Cash management is a major beneficiary of taking a proactive preventative measure to increase ones profit and to eliminate unnecessary spending habits and non value added services when conducting everyday business. Therefore, a brief overview and definition of the different types of cash management and short term management will be given to compare and contrast techniques, which will be given to management and the employees a more in depth explanation to equip themselves with the various terms used during current management techniques.
Cash management techniques are provided in many ways. In management and short-term financing, financial managers use different cash management techniques to minimize loans from outside sources and to ensure that sufficient cash is on hand to meet obligations. Good cash management improves a company's profitability by shortening the collection time line (thus increasing available cash), reducing operational costs, and slowing disbursements of cash.
There are three parts which complete the management process, one being consolidating cash in a reasonable amount of time. Cash management is a flow of fund through an entity (Block & Hirt, 2005, 55). Examples of cash management are investments, disbursements, and activation of cash. The use of cash management gives a company the ability to budget accurately ahead of time, allowing the flow of cash to be evaluated for effectiveness and efficiency creating an increase in funds. Investments are the amount invested for future benefits such as... [continues]
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(2008, 10). Cash Management. StudyMode.com. Retrieved 10, 2008, from http://www.studymode.com/essays/Cash-Management-167997.html
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