The Cash Conversion Cycle

EDITOR'S PERSPECTIVE

Post-Crisis Cash Conversion

Andrew Deichler 29 July

 

Much has been written about how treasury's role has grown since the 2008-09 financial crisis, and with that growth has come greater visibility - and scrutiny. In particular, the cash conversion cycle (CCC), which is used to evaluate a company's ability to convert current resources into actual cash, is under a microscope. In this week's focus, we look at how the CCC has changed over the past five years and whether the cash management quality of corporates has improved in the challenging post-crisis business environment. Gil Gadot of Fundtech leads off this week's focus with a look at liquidity management. Enhancing the availability of liquidity can help improve the availability of cash across the business; therefore, banks need to provide their corporate clients with superior solutions. Also in this focus, Greg Person of Kyriba looks at how treasurers can reduce the cash conversion cycle through effectively managing working capital, Devashis Das of RBS offers some tips on how companies can convert assets into cash, and Stanley Tan of DBS Bank looks at how CFOs and treasurers can cut down on CCC time.

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Managing Cash by Managing the Supply Chain

Stanley Tan, DBS Bank | 28 July

Since the Global Financial Crisis of 2008-09, there has been a renewed emphasis on the quality and sustainability of earnings. Beyond top-line revenue growth, management and investors alike have focused on the quality of free cash flows and internal efficiencies as a source of competitive advantage and value creation. In particular, working capital management and the ability to optimise cash conversion cycle (CCC) times have become increasingly important.

Leveraging an Effective Working Capital Strategy to Reduce the Cash Conversion Cycle

Greg Person , Kyriba | 25 July

As the global economy continues to recover following the 2008 financial crisis, the treasurer’s strategic value to the organisation is evolving toward efficiently managing working capital, to meet the growing liquidity needs of their expanding companies. The question ‘where’s my cash?’ was, of course, a top priority from chief financial officers (CFOs) to treasurers during the crisis. However, treasurers are now asked to not only safeguard cash, but also to become a more strategic business partner, to ensure corporate free cash flow and liquidity goals are realised.

Analysing Liquidity using the Cash Conversion Cycle

Gil Gadot , Fundtech | 24 July

The global financial crisis of 2008-09 triggered a radical reshaping of the corporate treasury landscape. While moving cash around a company as efficiently and effectively as possible is an age-old problem for treasurers, its successful management has become even more challenging in the post-crisis era.

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