Cash is a company's most liquid asset and it is very important that it is properly controlled, managed and available for the company to meet its obligations and run its day to day affairs. Controlling cash is one of the most important areas that a manager needs to focus on. Without having adequate access to cash, a company can run into problems and if proper controls are not put in place misappropriation of cash could occur. Controls are built for cash management to ensure that cash is accounted, safeguarded and reported correctly. This ensures that only authorized transactions are taking place.
In this section we will start with helping you understand the definition and concepts pertaining to Cash Management. We will discuss accounting for Cash Transactions including explaining the benefits of understanding the controls and procedures of accounting for cash transactions. We will provide you with practical understanding of implementing basic requirements of an internal control system to ensure effective cash management. Provide you with examples of common techniques employed to control cash and discuss various ratios related to cash and cash management.
We will also discuss the services generally offered by banks and third parties and utilized by larger businesses and corporations including Account Reconcilement Services, Advanced Web Services, Armored Car Services (Cash Collection Services), Automated Clearing House, Balance Reporting Services, Cash Concentration Services, Lockbox, Sweep accounts, Zero Balance Accounting and Wire Transfer. We will also discuss the cash flow and cash flow management techniques.