Cash pool and Cashflow: Difference between pages

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''Cash and liquidity management''
''Accounting - cash management - financial reporting.''


A cash pool is a structure involving several related bank accounts whose balances have been aggregated for the purposes of optimising interest paid or received and improving liquidity management.  
(CF).  


A cash pool can be physical or notional.  
The movement of cash in or out of a business, a project or a financial instrument in a particular period under review.




A physical cash pool is a concentration account used for the purposes of managing liquidity. Surplus funds are physically concentrated into the account in order to maximise interest. Deficit accounts are covered by transfers from the cash pool in order to minimise overdraft interest.
The cashflow for a given period may differ from the profit or loss for the same period because of:


#Items in cashflow which are not part of profit or loss.  For example capital expenditure or the collection of trade debtors arising and recognised in prior periods; and
#Items in profit or loss which are not cashflows, such as depreciation, amortisation, or making accruals.


A notional cash pool is a structure involving several related accounts whose balances have been aggregated for the purposes of optimising interest paid or received.  In other words a bank looks only at the total balance of the accounts in the notional pool when calculating interest, but there is no physical movement of funds.
 
Cashflow is sometimes written ''cash flow''.




== See also ==
== See also ==
* [[Aggregation]]
* [[Accounting]]
* [[Accrual]]
* [[Amortisation]]
* [[Cash]]
* [[Cash conversion cycle]]
* [[Cash flow statement]]
* [[Cash management]]
* [[CertICM]]
* [[CertICM]]
* [[Concentration account]]
* [[Depreciation]]
* [[Consolidation]]
* [[Financial reporting]]
* [[Liquidity]]
* [[Free cash flow]]
* [[Master account]]
* [[Incremental cash flows]]
* [[Notional pooling]]
* [[Profit]]
* [[Legal implications of cash pooling structures]]
 


===Treasurer articles===
[http://www.treasurers.org/node/9923 The pros of pooling, ''Sarah Boyce'']


[http://www.treasurers.org/node/8824 Take the plunge, ''Brendan McGraw'']
==Other resource==
[http://www.treasurers.org/node/9020 Students: Cash in, The Treasurer, May 2013]


[[Category:Cash_management]]
[[Category:Cash_management]]
[[Category:Liquidity_management]]

Latest revision as of 13:41, 18 July 2022

Accounting - cash management - financial reporting.

(CF).

The movement of cash in or out of a business, a project or a financial instrument in a particular period under review.


The cashflow for a given period may differ from the profit or loss for the same period because of:

  1. Items in cashflow which are not part of profit or loss. For example capital expenditure or the collection of trade debtors arising and recognised in prior periods; and
  2. Items in profit or loss which are not cashflows, such as depreciation, amortisation, or making accruals.


Cashflow is sometimes written cash flow.


See also


Other resource

Students: Cash in, The Treasurer, May 2013

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