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Encompasses the strategies and practices involved in managing an organization's financial assets, cash flow, and risks to optimize liquidity and minimize costs.
Presenting and explaining your own organization’s credit standing to external parties will influence their willingness to do business with you and the terms they will demand.
It refers to any use of resources for future benefit.
Inventories are not part of working capital.
The key role of the treasury function is to advise the board and management on business decisions and technical operations considerations that are fundamental to corporate strategy.
The economic value perfective identifies risk arising from short-term interest rate gaps.
Those who trade assets on the stock market cannot just buy or sell any asset at any time.
Invoicing a customer for products or services you sold creates revenue.
Working capital management also boost company’s earnings.
More companies today are now requiring cash surplus than in the past.
Managing receivables to optimize the investment in working capital.
__is the process of costing a balance sheet and then setting requisite prices for asset creators.
Treasury reports should be in accordance with IFRS.
IFRS stands for __.
A company can sell goods before they have to pay the bill to the vendor is __.
Inter-company payments can often be another source of lost liquidity.
__refers to money put up and owned by the owners.
Software development facilitates treasury function.
An organization with little cash can remain liquid as long as it has the ability to borrow.
Successful management depends on having an insight into the business’s future cash generation.
Profit from past years that have been kept by the company is known as __.
Use Income statement to check liquidity.
Working capital management is less significant to operation cycle of the business.
Manufacturers take advantage of long-term debt by issuing __.
If your business is expanding, business loan is not recommended.
Consolidating bank accounts balances from a number of accounts into one account to offset interest income against expense
__is the amount and type of risk an organization is willing to accept in pursuit of its business objectives.
Forwards and future contracts help investor hedge interest rate risks.
Business can use accounting programs to make cash flow analysis easy.
__ of the government will also affect the capital structure decisions.
A business should generate enough __to finance its future growth.
Identify the factor on which an organization’s financial strategy assesses the optimal financing solution as how to measure and monitor leverage.
Business strategy and financial strategy together form a __ strategy.
__is the safest type of debt capital because the company has years to come up with the principal.
Identify the factor on which an organization’s financial strategy assesses the optimal financing solution as the ease and cost of financing.
Capital financing is balancing act between debt and equity.
Externally raised capital may be debt or __.
Shareholders are determined to maximize long-term free cash flow.
Assets and Liabilities sit on a Balance Sheet.
Capital structure includes short-term liabilities
__also called Zero balancing.
Funding strategies include asset-based financing, leasing and working-capital financing.
One type of liquidity refers to the ability to trade an asset.
In debt ratio, more liabilities mean less equity and therefore indicate a more __position.
Equity consists of a company’s Common and __ stock plus Retained earnings.
__risk focuses on longer-term and ensure that the business can continue business plans in the future.
Optimizing bank charges and float can save considerable amounts of money.
Responsibilities of hedging company-wide interest rate and FX risk sits with the __.
Profit is equal to cash flow.
__are essential tool for identifying trends and overall cash generation over time.
Working capital is the difference between the current assets and current liabilities.
At the strategic level, treasury is about advising on the appropriate choices, trade-offs and compromises involved when financial decisions are taken.
__are loans from the capital market to meet day-to-day working capital requirements.
Companies in developing markets focus too closely on accounting-type measures.
Most companies have had a treasury department.
FX spot trades cannot be used to long-term interest rate swaps.
__ratio provides insight into how risky a company’s borrowing practices.
__risk focuses on short-term needs arising from day- to- day operations.
Assets structure=Fixed Assets +Current Assets
Interest rates affect equity investors and less directly than bond investors.
Cash is King, because NO cash, NO business.
Inventory is a current asset
__ arises when an organization has to commit to a price before actually entering into transactions.
Investing covers which of the following?
Land and buildings or expensive equipment are good security for a provider of acquisition funds.
Diversification is not an answers to interest rate risk.
Liquidity enables an organization to pay its obligations where and when they fall due.
Digital payments have risen sharply because of corona virus.
Cash flow problems can be one of the leading causes of failure for business.
Banks should measure their vulnerability to loss under stressful market conditions.
Current assets include anything that can be easily converted into cash within 24 months.
It is good to manage cash flow using the bank balance.
__ crystallize the asset positions into GBP to retain parity.
Risk of __ arises due to failure to pay fixed interest liabilities.
The use of fixed interest bearing securities along with owner’s equity as sources of finance is known as __.
__is the money that was originally invested in the business in exchange for shares of stock or ownership.
Total debt to total assets is known as __ratio.
If the economy is slow, the central bank may reduce the interest rate to stimulate activity.
__model provides insight into how company will earn on the money its owners have invested.
Shortened the cash flow conversion period is not a good idea.
Cash flow means cash receipts.
Treasurers are financial asset managers in their company.
Corporate finance is concerned with maximizing shareholder value through short-term financial planning.
Business will not lose money when they don’t hedge exposures for currencies.
Borrowing facilities are included in cash-flow forecasts.
Long-term assets are different from non-current assets.
For short-term cash flow shortages, many business owners make use of credit cards or lines of credit.
A sudden change in currency would distort the risk.
The government gives financial support for businesses struggling from the impact of corona virus.
Medium term forecasts often extend to a rolling year.
Every organization deals with treasury issues, but many organizations have the same treasury functions.
Interest rate risk arises when the absolute level of interest rates fluctuate.
Identify the primary sources of capital funding.
Good cash forecast accurately predicts the cash inflows but never the outflows.
There are more than ten ratios involved in tracking down efficient working management.
Risk is the primary source of the firm’s growth.
Banks are seldom evaluated on their liquidity.
Moody’s Standard & Poor’s is a __agency.
Strong balance sheets should reflect lower levels of debt and higher levels of __.
Acid test ratio is a strong indicator whether a firm has sufficient short-term assets to cover its immediate liabilities.
The element of receivables management comes under the umbrella of cash forecasting.
Identify the factor on which an organization’s financial strategy assesses the optimal financing solution as the diversity of sources and the maturity of financing.
Earning perspective involves the impact of changes in interest rates on accrual.
Working capital management requires monitoring of the company’s assets and liabilities.
Organizations with more stable cash flows and longer-term assets will be more comfortable servicing debt and so are unlikely to borrow for proportionately longer periods.
Capital expenditure is an operational item.
Risk can present opportunities or threat to business objectives.
Interest rates and bond prices are inversely related.
Cross-currency transactions can be unpredictable.
Banks are not required to hold capital commensurate with the level of interest rate risk.
Firms with a variety of operations across the globe may encounter data consolidation issues when attempting to analyze liquidity risk at the group level.
__ system covers the providers of funds against risks.
In the company’s treasury department funds move in real time.
Effective treasury requires a thorough understanding of the organization’s business model and its industry.
A __ of a company helps to increase the market price of shares and securities.
Equity financing involves raising money from venture capitalists.
__is the particular combination of debt and equity used by a company to finance its overall operations and growth.
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