Each company uses a fixed and working capital.Last of its functional purpose is divided into funds treatment and current production.To fund the treatment include the following elements:
- commodity products stored in the warehouse;
- shipped commodity products (goods in transit);
- funds that are in settlements with consumers of commercial products.
Often funds treatment, are in the form of cash, take many forms:
- financial instruments (in this case, they may be in the accounts in the bank or other credit institutions, letter of credit or securities);
- funds held directly at the ticket office or in settlements with counterparties.
To maximize the operational cash management is determined by the time of their treatment and the optimal size of the volume produced cash flow analysis and forecasting.
Funds treatment in the form of goods in transit are divided into groups:
- goods for which the terms of payment have not yet occurred;
- products for which the payment period has expire
- goods, which are deposited with the acquirer.
funds treatment, presented in the form of receivables consists of debt:
- providers who have expired terms of payment;
- all reporting entities;
- tax authorities (when there was an overpayment of taxes, mandatory payments are made to the budget in the form of advance payment);
- Receivable on disputed debts and claims.
Any receivables inevitably diverts funds from circulation, so reducing the efficiency of their use, which may lead the company to the difficult financial situation.It is directly linked to the level adopted by the billing system, the range of products and the state of saturation of the market similar products.The specific weight of its assets in the whole structure treatment often quite large, and therefore requires a hard, permanent control.Management of debt involves control of the organization in charge of financial services, the speed of turnover of such funds in the respective calculations.
treatment as funds - are funds invested in stocks of finished marketable products;already shipped but not paid for;funds in settlements with debtors, they are closely related to the process of circulation of commodities.These funds do not participate in the formation of the cost of goods, and are direct its bearers.All movements of working capital is a continuous single process.At the end of the production cycle, after the production of marketable products, as well as its implementation of all of the value of these assets shall be compensated in the form of revenues from sales of products (services, works).
Funds appeals are in constant motion, so allow the circuit means.This constant is a change of forms of value: because the money form becomes a commodity, then the industrial and commodity and money again.
stage of monetary funds circulation becomes a form of inventory, then the production stage reserves are converted into finished products, after sales (stage commodity) products it acquires the form of money.All advances in the form of inventory will be returned, as part of savings that exceeds the cost of sales is the profit of the enterprise.
effective use of the treatment depends on the rate of turnover.The main indicators include the duration of the turnover, turnover ratio and downloads.