Finding Best Practices on Cash Management and Cash Strategy

If you are new in the finance industry, you might want to focus first in doing cash management for company. This is basically the way a company works on using, handling, and collecting cash within the company itself and from its business partners.

The task will require your skills in reading and analyzing financial flow in the company as well as its market liquidity and investments in the market. But usually, cash management for company is for huge companies only.

If you are assigned or you eventually land a job such as this in the company, this simply means that you are with a financially viable company.

Cash management for company is usually provided by large banks and finance corporations, although there are some companies who also hire their own finance professional to do the cash management for company.

Here is a list of what they do when they are in the process of cash management for company:

1. Account reconciliation. One of the most difficult financial tasks for large companies or corporation is balancing or reconciling their accounts. For this reason, they usually hire a finance company which is usually a bank or a top man to do the account reconciliation.

This task is usually done with the use of used checkbooks to see where the cash of the company goes. This is the old school way of cash management for company, though. These days, account reconciliation can be done easier with the help of a bank’s software and a system that is called ‘positive pay’.

Positive pay is a system that allows a company to input any checks used in a daily basis so that at the end of the month, it will be easy for the finance person to check which check has been cleared and which has not.

Knowing these things will easily allow the finance personnel to see what the actual balance of the company is. On top of that, the bank will also easily know if there are fraudulent checks being used as these checks will not be in the list of the positive pay system.

2. Advanced web services. Another brilliant way to do cash management for company is through providing advanced web services for its consumers. This is by creating a website for the company’s different services, thereby allowing its consumers and customers to use the facility.

These sites are normally partnered with systems that allow the consumer to create their own accounts within the system, thereby being able to do everything that they need to do in the company online and doing it discretely.

3. Armored car services/cash collection. Another way of cash management for company is by requesting a personalized pick up of the company’s money with the use of secured equipment and tools.

Among these is cash collection by authorized bank agents or through the use of armored car services of the corporation doing the cash management for company, whichever is applicable to the said company.

Cash management plays a vital role for the success of any company. Now, you already know about its concept.

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