The purpose of this seminar is to give you a practical understanding of methods and tools applied in cash management.
We start with general introduction to "cash management" and explain how good liquidity management can enable companies to achieve optimal profitability from under-utilized funds and increase control over their cash flows.
We then explain how the sources and uses of the firm's cash can be identified and how cash inflows and outflows can be assessed by looking at known assets and liabilities and from budget simulations. We also explain how critical "trouble spots" and the firm's vulnerability to cash flow shortfalls can be quantified.
We then present and explain a number of tools and methods that you can use to change idle funds into working cash. One strategy is to optimize your working capital using "just in time" inventorying and other techniques. Another method is "pooling", which will enable you to minimize interest expense by off-setting ("netting") debit and credit positions while preserve autonomy, control and record-keeping without having to actually move funds. We also explain how notional pooling can be used in conjunction with "target balancing" and "automated investments". Other tools include "controlled-investment accounts", "end-of-day sweep accounts" and "lock-box accounts" that can be set up with the assistance of a big money center bank or regional bank.
Finally, we discuss how a policy for cash management can be formulated and implemented to ensure that adequate control procedures have been put in place and maintained to secure cash collections and cash handling at all levels of the organisation.