Archive for the ‘capital management’ Category

What is capital management?

Sunday, December 2nd, 2012

capital management, capitalCapital management is basically a strategy of accounting that aims to make a sufficient maintenance of the working capital of the company and also tries to keep the levels equal. It also deals with the current liabilities as well as the current assets of the company in concern. It is a very important strategy that helps the company to meet the obligations of expenses and maintain the sufficient cash flow of the company at the very same time.

It is a very important tool when it comes to the decisions regarding the short term finances of the company. There is a different department for the capital management of a company. It is given high importance and skilled professionals are hired for this job. How the capital of a company is managed plays a very important role in the overall dynamism of the company. Therefore, capital management is very important in modern day businesses.

Cycle Of Cash Conversion Made Clear

Friday, May 18th, 2012

Cycle of cash conversion, Cash ConversionDo you have any idea about the cycle of cash conversion? Well, the very cycle refers to the time duration required by a company in converting its strategies requiring the cash back to cash returns.

This cycle of cash conversion is constituted of 3 principle working capital constituents such as ARO in days (Accounts Receivable Outstanding), APO in days (Accounts Payable Outstanding) & IOD (Inventory in Days). The CCC or cycle of cash conversion is equivalent to time taken to sell the inventory & collect the receivable lower the span taken for paying your payables. Actually CCC is IOD plus ARO minus APO.

Now, it’s to mention that the cycle of cash conversion is an important element while you are running your business. It’s because the cycle represents amount of day the company’s cash stays tied up into business operations. It would also assist to understand how smartly the company is managing and handling the working capital.

PPI refunds explained

Friday, April 20th, 2012

The policies of PPI intend to make coverage of the payments of the credit cards and the monthly loans of the customers. The entire amount could be covered or certain percentage can be covered by the policy. The policy could be implemented when due to some unavoidable circumstance; the customer fails to work or meets with an accident. The original function of the policy of the PPI is to make coverage of the payments of the customers but in most cases the policy gets sold to those customers who are unable to claim against insurance.

The policies of the PPI have been wrongly used in many cases by a number of providers of credit card and loans and some of these names include HSBC, Capital one and Alliance and Leicester. These reputed companies had to pay fines in millions for the misappropriation of the policies of PPI. However, one can be benefited by the policies if implemented correctly.