Issue 4, 2008

Ezerskaya O. M. Cash Management Models: Theoretical Analysis

Interdisciplinary approach means that the company directs its efforts at effective cash management and eager to define the optimal cash balance maximizing the company’s value. As managers and owners have different views on the problem of optimal cash balance, cash management is a mechanism that allows owners to control managers decisions within the bounds of managerial theory of a firm. Most of enterprises no matter with structured or vague cash management policies encounter the problem of cash deficit or excess, that induce scholars to investigate the consequences of this deficit/excess problem. Comparative analysis of cash management models employed in this article makes it possible to conduct empirical study of cash management policies pursued by companies acting in conditions of emerging markets. There are two proposes of this analysis: the first is to define deficit or surplus of cash flow from operating activities and the second is to investigate how the manager’s opportunistic behavior affects on cash flow. Keywords: Cash, Cash Flow, Cash Management, Cash Management System, Free Cash Flow, Financial Management, Financial Analysis of Cash Flow.

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