The document discusses factors that influence a company's capital structure and efficient cash management. It identifies six key factors that determine a company's capital structure: cash flow position, interest coverage ratio, control, stock market conditions, regulatory framework, and tax rates. It also discusses three objectives of cash management - controlling cash levels, controlling cash inflows, and controlling cash outflows. Specific techniques for meeting these objectives include preparing cash budgets, adopting concentration banking and lockbox systems, and playing float to maximize available funds. Overall, the document emphasizes the importance of planning, controlling, and optimizing a company's sources and uses of cash.
WORKING CAPITAL MANAGEMENT
CASH MANAGEMENT
MOTIVES OF HOLDING CASH
SIGNIFICANCE OF CASH MANAGEMENT
STRATEGIES FOR CASH MANAGEMENT
EOQ model to cash managemnt
FIN 534 Week 9 Working Capital ManagementSlide 1Introduction.docxssuser454af01
FIN 534 Week 9: Working Capital Management
Slide 1
Introduction
Welcome to Financial Management. In this lesson we will discuss working capital management.
Next slide
Slide 2
Topics
The following topics will be covered in this lesson:
Current asset holdings;
Current asset financing policies;
The cash conversion cycle;
The cash budget;
Cash management and the target cash balance;
Cash management techniques;
Inventory management;
Receivables management;
Accruals and accounts payable (Trade Credit);
Short-term marketable securities;
Short-term financing;
Short-term bank loans;
Commercial paper; and
Use of security in short-term financing.
Next slide
Slide 3
Current asset holdings
The level of working capital required by the firm answers two questions:
First, what is the correct amount of both total working capital and for each specific account?
Second, how should working capital be financed?
Gross working capital refers to current assets used in operations. Networking capital is given by current assets minus current liabilities. Net operating working capital or NOWC is given by current operating assets minus current operating liabilities. Usually, NOWC consists of cash required in operations, accounts receivable, and inventories minus accounts payable and accruals.
When deciding upon the amount of working capital the firm focuses on operating current assets which consist of cash plus marketable securities, inventories, and accounts receivable. The level of operating current assets is a policy decision on the part of the firm and impacts profitability. Depending on its level of current operating assets the firm may run a relaxed, moderate or restrictive level of operating current assets. The optimal strategy is the one that management believes will maximize the stock’s intrinsic value.
Next slide
Slide 4
Current asset financing policies
Any investment in operating current assets must be financed and the primary sources of funding are bank loans, accounts payable, accrued liabilities, long-term debt, and common equity. Since current assets rarely dropped to zero, companies usually have some level of permanent current operating assets which the firm needs even at the lowest point of the business cycle.
Additionally, the firm has temporary operating assets which increase as sales increase during a cyclical upswing. The difference between permanent and temporary current operating assets and how they are financed is referred to as the current operating assets financing policy.
The firm has three policies it may use to address this issue:
First, a maturity-matching policy requires that the maturities of assets and liabilities match.
Second, an aggressive policy permits the use of short-term financing for some permanent assets.
And third, a conservative policy uses long-term financing for all permanent operating assets and for some of the temporary current assets.
Ultimately the financing method used depends on the ...
Management of working capital
Cash management
SIGNIFICANCE Cash management
motives to hold cash.
a. Transactions motive
b. Precautionary motive
c. Speculative motive
d. Compensation motive
Minimising funds committed to cash balances
WORKING CAPITAL MANAGEMENT
CASH MANAGEMENT
MOTIVES OF HOLDING CASH
SIGNIFICANCE OF CASH MANAGEMENT
STRATEGIES FOR CASH MANAGEMENT
EOQ model to cash managemnt
FIN 534 Week 9 Working Capital ManagementSlide 1Introduction.docxssuser454af01
FIN 534 Week 9: Working Capital Management
Slide 1
Introduction
Welcome to Financial Management. In this lesson we will discuss working capital management.
Next slide
Slide 2
Topics
The following topics will be covered in this lesson:
Current asset holdings;
Current asset financing policies;
The cash conversion cycle;
The cash budget;
Cash management and the target cash balance;
Cash management techniques;
Inventory management;
Receivables management;
Accruals and accounts payable (Trade Credit);
Short-term marketable securities;
Short-term financing;
Short-term bank loans;
Commercial paper; and
Use of security in short-term financing.
Next slide
Slide 3
Current asset holdings
The level of working capital required by the firm answers two questions:
First, what is the correct amount of both total working capital and for each specific account?
Second, how should working capital be financed?
Gross working capital refers to current assets used in operations. Networking capital is given by current assets minus current liabilities. Net operating working capital or NOWC is given by current operating assets minus current operating liabilities. Usually, NOWC consists of cash required in operations, accounts receivable, and inventories minus accounts payable and accruals.
When deciding upon the amount of working capital the firm focuses on operating current assets which consist of cash plus marketable securities, inventories, and accounts receivable. The level of operating current assets is a policy decision on the part of the firm and impacts profitability. Depending on its level of current operating assets the firm may run a relaxed, moderate or restrictive level of operating current assets. The optimal strategy is the one that management believes will maximize the stock’s intrinsic value.
Next slide
Slide 4
Current asset financing policies
Any investment in operating current assets must be financed and the primary sources of funding are bank loans, accounts payable, accrued liabilities, long-term debt, and common equity. Since current assets rarely dropped to zero, companies usually have some level of permanent current operating assets which the firm needs even at the lowest point of the business cycle.
Additionally, the firm has temporary operating assets which increase as sales increase during a cyclical upswing. The difference between permanent and temporary current operating assets and how they are financed is referred to as the current operating assets financing policy.
The firm has three policies it may use to address this issue:
First, a maturity-matching policy requires that the maturities of assets and liabilities match.
Second, an aggressive policy permits the use of short-term financing for some permanent assets.
And third, a conservative policy uses long-term financing for all permanent operating assets and for some of the temporary current assets.
Ultimately the financing method used depends on the ...
Management of working capital
Cash management
SIGNIFICANCE Cash management
motives to hold cash.
a. Transactions motive
b. Precautionary motive
c. Speculative motive
d. Compensation motive
Minimising funds committed to cash balances
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
Financial Assets: Debit vs Equity Securities.pptxWrito-Finance
financial assets represent claim for future benefit or cash. Financial assets are formed by establishing contracts between participants. These financial assets are used for collection of huge amounts of money for business purposes.
Two major Types: Debt Securities and Equity Securities.
Debt Securities are Also known as fixed-income securities or instruments. The type of assets is formed by establishing contracts between investor and issuer of the asset.
• The first type of Debit securities is BONDS. Bonds are issued by corporations and government (both local and national government).
• The second important type of Debit security is NOTES. Apart from similarities associated with notes and bonds, notes have shorter term maturity.
• The 3rd important type of Debit security is TRESURY BILLS. These securities have short-term ranging from three months, six months, and one year. Issuer of such securities are governments.
• Above discussed debit securities are mostly issued by governments and corporations. CERTIFICATE OF DEPOSITS CDs are issued by Banks and Financial Institutions. Risk factor associated with CDs gets reduced when issued by reputable institutions or Banks.
Following are the risk attached with debt securities: Credit risk, interest rate risk and currency risk
There are no fixed maturity dates in such securities, and asset’s value is determined by company’s performance. There are two major types of equity securities: common stock and preferred stock.
Common Stock: These are simple equity securities and bear no complexities which the preferred stock bears. Holders of such securities or instrument have the voting rights when it comes to select the company’s board of director or the business decisions to be made.
Preferred Stock: Preferred stocks are sometime referred to as hybrid securities, because it contains elements of both debit security and equity security. Preferred stock confers ownership rights to security holder that is why it is equity instrument
<a href="https://www.writofinance.com/equity-securities-features-types-risk/" >Equity securities </a> as a whole is used for capital funding for companies. Companies have multiple expenses to cover. Potential growth of company is required in competitive market. So, these securities are used for capital generation, and then uses it for company’s growth.
Concluding remarks
Both are employed in business. Businesses are often established through debit securities, then what is the need for equity securities. Companies have to cover multiple expenses and expansion of business. They can also use equity instruments for repayment of debits. So, there are multiple uses for securities. As an investor, you need tools for analysis. Investment decisions are made by carefully analyzing the market. For better analysis of the stock market, investors often employ financial analysis of companies.
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
BYD SWOT Analysis and In-Depth Insights 2024.pptxmikemetalprod
Indepth analysis of the BYD 2024
BYD (Build Your Dreams) is a Chinese automaker and battery manufacturer that has snowballed over the past two decades to become a significant player in electric vehicles and global clean energy technology.
This SWOT analysis examines BYD's strengths, weaknesses, opportunities, and threats as it competes in the fast-changing automotive and energy storage industries.
Founded in 1995 and headquartered in Shenzhen, BYD started as a battery company before expanding into automobiles in the early 2000s.
Initially manufacturing gasoline-powered vehicles, BYD focused on plug-in hybrid and fully electric vehicles, leveraging its expertise in battery technology.
Today, BYD is the world’s largest electric vehicle manufacturer, delivering over 1.2 million electric cars globally. The company also produces electric buses, trucks, forklifts, and rail transit.
On the energy side, BYD is a major supplier of rechargeable batteries for cell phones, laptops, electric vehicles, and energy storage systems.
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
This assessment plan proposal is to outline a structured approach to evaluati...
Ramkb.docx
1. The determinant of capital structure of a company? OR ‘Determination of capital
structure of a company is influenced by a number of factors’ explain six such factors.
Ans. Capital structure refers to the relative proportion of different sources of long
term finance. Following factors are to be considered before determining capital
structure. a) Cash flow position: The cash available with the company should be enough
to meet the fixed interest liabilities. Interest on debt is to paid irrespective of
profits. A company has to meet working capital requirements, invest in fixed assets and
also pay the interest and principal amount of debt after a particular stipulated period. If
cash position is sound, debt van be raised, and if not sound debt should be
avoided. b) Interest coverage ratio : it is the ratio that expresses the number of times
the Net profit before interest and tax covers the interest liabilities. Higher the
ratio, better is the position of the firm to raise debt. c) Control : Issue of Equity shares
dilutes the control of the existing shareholders , whereas issue of debt does not as the
debenture holders do not participate in the management decisions as they are not the
owners of the fir. Thus if control is to be retained, equity should be avoided. d) Stock
market conditions : If the stock market is bullish, the investors are adventurous
and are ready to invest in risky securities, equity can be issued even at a premium
whereas in the Bearish phase, when the investors become cautious, debt should be
issued as there is a demand for fixed cost security. e) Regulatory framework : Before
determining the capital structure of a company , the guidelines of SEBI and
concerned regulatory authority is to be considered. For e.g companies Act,
Banking regulation Act etc are to considered. f) Tax rate : As interest on debt is
treated as an expense, it is tax deductable. Dividend on equity is the distribution of
profit so is not tax deductable. Thus if the tax rates are high, issue of debt is an
attractive means as it is economical in nature.
‘Efficient’ cash management will aim at maximising the cash inflows and slowing
cash outflows’. Discuss this statement.
Cash management involves the following three basic problems:
1. Controlling Level of Cash : One of the basic obiectives of cash management is to
minimise the level of cash balances with the firm, This obiective is sought to be
achieved by means of the following :
a. Preparing Cash Budget : The cash budget is the most significant tool for
planning and regulating cash usage. It is a prediction of the firm’s future cash
receipts and cash payments over various time intervals. It shows the financial
management the date and quantity of expected cash receipts and payments
throughout time. Based on this information, the finance manager may forecast
the firm’s future cash needs, plan for financing these needs, and exercise control
over the company’s cash and liquidity.
b. Providing for Unpredictable Discrepancies : The cash budget displays the
differences between cash revenues and payments based on routine business
2. activity. It does not account for certain unforeseeable differences in cash inflows
and outflows caused by unforeseen circumstances such as strikes, lock-outs,
recessions, abrupt increases in raw material prices, natural calamities, and so
on. A reasonable cash balance must consequently be maintained to face such
unforeseeable eventualities. Provision for contingencies is made based on past
experiences and some future intuitions.
c. Consideration of Short Costs : The term ‘Short Costs’ refers to the cost
incurred as a consequences of shortage of cash. Such cost may take any of the
following forms :
i. The failure of the firm to discharge its obligations in time may result in legal
action by the creditors against the firm. This will cost in terms of fall in the
firms goodwill, in addition to the financial costs of defending the suit.
ii. The firm may have to borrow funds at high rates of interest and may also
be required to pay penalties to banks for not meeting the obligation in time.
iii. There may also be the loss of cash discount, besides losing opportunity of
purchases at lower prices.
2. Controlling Inflows of Cash: In order to prevent fraudulent diversion of cash
receipts and speeding up collections of cash, an adequate control on cash inflow is
necessary. A properly installed internal check system can, to a great extent, minimise
the possibility of fraudulent diversion of cash.
Speedier collection of cash can be made possible by adoption of the following two
techniques, which have been found quite useful and effective in the USA.
a. Concentration Banking System : It is a system of decentralizing collections
of account receivable. According to this system company’s regional branch
offices are authorised to Collect the payments from the customers and deposit in
the local bank accounts. instructions are given to the regional or local collection
centres to transfer the funds over a certain limit to the company’s head office
bank daily either telegraphically or by telex. Regional offices on the collection
centres maintain an account of cost of remittances paid by them. This system
facilitates fast movement of funds. On the basis of the daily report received from
the head office bank about the collected funds, the treasurer can use them for
disbursement as per requirements. This system is good in case of large firm
having their Spread over a large area. The system of concentration banking,
therefore, helps in quicker collections of cash.
b. Lock Box System : This system is more popular in the USA and is a further
step in speeding up collection of cash. Under this system the company hires a
post office box and instruct its customers to mail their remittances to the box. The
company’s local bank is authorised to pick the remittances directly from the local
box, The bank picks up the mail several times a day and deposits the cheques in
the company’s account. Standing instructions are also given to the local banks to
3. transfer the collected funds to the head office bank when they exceed a certain
limit. This system speeds up collection of cheques and the firm comes to know
about the dishonored cheques and weak credit situation very soon. It also
reduces the chances of fraud in the cash collection pro cess and controls the
cash inflows better. In order to avoid the unnecessary pockets of idle funds, the
company should maintain minimum number of bank accounts.
3. Controlling Outflows of Cash : An effective control over cash outflow is equally
important for conserving cash and reducing financial requirements. Control over cash
outflows signifies slow disbursements. A combination of fast collections and slow
disbursements will, obviously, result in maximum availability of cash funds. In order to
control the outflows of cash efficiently, a firm should keep in view the following
considerations :
a. Centralised system for cash payments should be followed as compared to
decentralised system. All payments should be made from a single control
account, i.e. from the central office of the company. However, local expenses
may be paid by the local office of the company. This will result in delay in
presenting cheques for payment by creditors who are away from the place of
control account.
b. Payment should be made on the due dates neither before nor after. The
company should neither lose cash discount nor its prestige on account of
delayed payments. The company should, therefore, made payments within the
terms offered by the suppliers.
c. ‘Playing Float’ techniques should be used by the company for maximising the
availability of funds. The term float’ means the account tied up in cheques which
have been issued by the company but have not yet been presented for payment
by the creditors. As a result of a time-lag between issue of a cheque and its
actual presentation, the actual bank balance of a firm may be more than the
balance shown by its books. This difference is called ‘payment in float’. The
longer the lost period’ the greater would be the benefit to the firm, If the financial
manager can accurately estimate the time-lag between issue of cheques and
actual presentation for during the intermittent period. In the meanwhile,
necessary cash may be arranged and deposited in the bank before the
presentation of cheques for payment. However, playing float is a risky game and
should be played very cautiously. In case, the cheques issued by the company
are dishonoured, the goodwill of the firm will be at stake and it may have
seriously adverse consequences for the firm.