Sources of Cash
What are the various sources of cash in an organization. Which sources increase the cash available with the enterprise and which sources results in outflow of the cash? Let us explore!
Every successful company has a pool of cash that sustains the day-to-day activities of business.
It grows with receipts from sales and contributions and shrinks with expenditures for inventory, marketing, labor and other expenses.
The uncertainty of cash inflows and outflows creates the challenge of ensuring that sufficient funds are available at all times to support the operating cycle.
Borrowing becomes necessary when cash flow falls short of covering disbursements.
When incoming funds exceed the outflow, cash is used to repay borrowings or purchase short-term investments until the cash is needed to cover future expenses.
Financial officers need timely information to properly control and use their funds throughout the cash flow cycle.
The Basic Cash Management Process provides that timely information.
Related Links
You May Also Like
-
How the inflow and outflow of cash is linked to the operating cycles of the business? Learn the cash management process in an enterprize and it's key components.
-
Although there is no straight forward answer to the question, how to best organize a treasury function, this article provides an generic view of the way large MNCs creates departments or sub-functions within the treasury function.
-
Collection Float is the time spent to collect receivables. Collection float is the sum total of time taken by Invoice Float; Mail Float; Processing Float and Availability Float. Explore more!
-
Account Reconciliation – How? Learn the three key attributes to perfom account reconciliation.
-
Cash Clearing – Accounting Entries
The Cash Clearing process enables you to track amounts that have actually cleared your bank. Learn the steps and accounting entries that gets generated during the cash clearing process.
-
Why enterprises need cash management. What is the purpose of having a well defined cash management process?
-
Suspense and clearing accounts resemble each other in many respects but there exists important fundamental difference between the two. Read more to explore these differences.
-
Introduction to Bank Reconciliation Process
These set of articles provide a brief introduction to Bank Reconciliation Process. This topic not only discusses the meaning of bank reconciliation process but also discusses how this process in handled in new age ERPs and Automated Reconciliation Systems.
-
The Cash Clearing process enables you to track amounts that have actually cleared your bank. Till reconciliation happens the amounts are parked in 'Cash Clearing Account'.
-
The objective of Financial risk management is to protect assets and cash flows from any risk. Treasury function works to accurately assess financial risks by identifying financial exposures including foreign exchange, interest rate, credit, commodity and other enterprise risks. Learn about the various risks that are managed by treasury.
