Cash Management Techniques and Methods of Short-Term Financing

by Dorothy Rule, Director and Global Head of Liquidity and Investments, Citigroup Global Transaction Services

In case balance sheet items have an efficient management, this can reduce a firm’s NWC. By more collecting receivables in aggressive way, long-term financing method should not be a way that firm may rely on (which may be costly) to fund its operations. Ideally, the current liabilities should cover most of the financing for current assets, and the shareholders equity the rest, from a lenders point of view. (Strischek, 2001)

A business borrows this type of finance for a certain period to enable it pay for goods received. The cycle for trade credit has a minimum of 28 days. However, the lenders may extend the credit period to long durations. This gives a business a humble time to arrange its cash flow and

Using knowledge so far to find out the problem in financial management of any company at home or abroad, give explanation and find out the lesson behind. (Report of 1500-2000 words).

In years where there is a financial deficit M&S uses the following additional funding to help finance the deficit and support growth of the company:

Financial manages will use the cash from banks or rose by selling securities to investors in the financial market to pay for different investment projects. Then as the business runs it will generate cash. Cash will be then either be reinvested or paid back to the shareholders as dividend. In this case, it explains that for shareholders despite the fact that they might have different preferences as mentioned, but mainly they have the same financial goals; they want the financial manager to maximize the current market value of shareholders’ investment in the firm. There is only one single way for managers to maximize the value of the firm, which is to increase firm’s market value and current price of shares.

This project is focusing on financial management in the international business, discussing three sets financial decisions such as:

Financial Management means planning, organizing, directing and controlling the financial activities and optimum utilization of funds of the enterprise (McALISTER L et al, 2016). The Strategic financial decision is most important decision that is made by an organization where the organization needs to make a business. The two important decisions that organizations make to make or maximize their profit are financing and investing. Both of the strategic decision is aimed to earn more profit and Return of investment (ROI).The Strategic financial decision of a company is based on the inflow and out flow of money in an organization. The tools and technique that most of the organizations use to make are as

Hence, working capital management is of particular importance to all businesses, since with limited access to the long-term capital markets, these firms rely more heavily on owner financing, trade credit and short-term bank loans to finance their needed investment in cash, accounts receivable and inventory. An active

This report describes on the first section a research about financial managers, which is covered with the job description, the roles, the skills & Knowledge, work environment and the rewards & job outlook. What is the financial management? “Financial Management means planning, organizing, directing and controlling the financial activities such as procurement and utilization of funds of the enterprise. It means applying general management principles to financial resources of the enterprise” (http://managementstudyguide.com/financial-management.htm, 2/12/2014). On the second section describes the author’s personal analysis of skills, the goals and ways of skill development. The purpose of this

* Obtain short-term funding – the cash flow forecast will illustrate potential problems to the management such that if the business have insufficient funds to meet its immediate debts in order to arrange short-term finance to cover this period of time. This could involve the business negotiating a bank overdraft, which will be much cheaper if pre-arranged with the bank. If this problem occurs then even the owner may wish to loan the business some funds to cover the shortfall.

It is process of collecting, managing and (short-term) investing cash. A key component of ensuring a company's financial stability and solvency

The rapid and unpredictive business changes make the business markets all over the world more competitive and exert competitive pressures on the firms. It is characterized by considerable amount of uncertainty regarding the demand, market price, and availability of raw materials. The markets in which real firms operate are not perfectly competitive. Hence this necessitates the firms to have working capital to meet the demand. Working capital management is important part in industries financial management decision. An optimal working capital management is expected to contribute positively to the creation of industry value. To reach optimal working capital management firm manager should control the tradeoff between profitability and liquidity

The competitive business environment in which companies develop their activity determines them to focus on strategies intended to improve their performance. This is because their performance on the market can be attributed to creating competitive advantage. This objective can be reached with different strategies, some of them based on reducing costs, others based on differentiation of companies' products and services. However, these strategies are affected by working capital of these companies. It is important to analyze how these companies manage their working capital in order to improve their performance.

CHAPTERS IN THIS PART 1 2 3 The Role and Environment of Managerial Finance Financial Statements and Analysis Cash Flow and Financial Planning