Proper Cash Management
Proper Cash Management
It is an important task of financial
manager. He has to assess the various cash needs at different times and then make
arrangements for arranging cash. Cash may be required to make payments to creditors,
purchasing raw material, meet wage bills, and meet day to day expenses. The sources of
cash may be Cash sales, Collection of debts, Short-term arrangement with the banks. The
cash management should be such that neither there is shortage of it and nor it is idle. Any
shortage of cash will damage the creditworthiness of the enterprise. The idle cash with
the business mean that it is nit properly used. Through Cash Flow Statement one is able
to find out various sources and applications of cash.
It is an important task of financial
manager. He has to assess the various cash needs at different times and then make
arrangements for arranging cash. Cash may be required to make payments to creditors,
purchasing raw material, meet wage bills, and meet day to day expenses. The sources of
cash may be Cash sales, Collection of debts, Short-term arrangement with the banks. The
cash management should be such that neither there is shortage of it and nor it is idle. Any
shortage of cash will damage the creditworthiness of the enterprise. The idle cash with
the business mean that it is nit properly used. Through Cash Flow Statement one is able
to find out various sources and applications of cash.
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