To understand cash management, one must understand FLOAT. Float is the most critical component in Cash Management. Learn about cash float in this article.
Float is the most critical component in Cash Management
Float is the time interval between the start and completion of each step in the cash management cycle.
The management of float is the management of cash.
Each cash management system is designed to improve the flow of cash by accelerating the collection of funds and extending the disbursement float.
There are two categories of Float:
Before we dive into cash management, let us fist understand what we mean by cash and what constitutes cash in context of cash management process.
The Cash Management component ensures that the enterprise has sufficient liquidity for payments that are due and to monitor payment flows. Learn how treasury plays an important role in cash management for the enterprise.
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'.
Bank reconciliation process is targeted to validate the bank balance in the general ledger and explain the difference between the bank balance shown in an organization's bank statement. Learn the reasons for existence of differences between the two.
Complete Bank Reconciliation Process
Bank Reconciliation Process is a eight step process starting from uploading the Bank Statement to finally posting the entries in General Ledger. Learn the Eight Steps in Detail!
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!
Many different accounts are used in finance. Understand the representation and nature of clearing account in context of accounting, finance and ERP Systems.
Effectively using cash management with trade finance products brings tangible benefits to both corporates and financial institutions.Learn the various benefits of cash management process.
Disbursement Float is the time taken from payment creation to settlement. Collection float is the sum total of time taken by Payment Float; Mail Float; Processing Float and Availability Float. Learn more!
Have you ever wondered what is actually a Bank Statement and why it is needed. What is the information that is available in a bank statement?
© 2023 TechnoFunc, All Rights Reserved