第二十七章 短期财务与计划

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1. Chapter Outline27.1 Tracing Cash and Net Working Capital 27.2 Defining Cash in Terms of Other Elements 27.3 The Operating Cycle and the Cash Cycle 27.4 Some Aspects of Short-Term Financial Policy 27.5 Cash Budgeting 27.6 The Short-Term Financial Plan 27.7 Summary & Conclusions
2. Executive SummaryWe are solidly in to the third great question of corporate finance.
3. The Balance-Sheet Model of the Firm Current Assets Fixed Assets 1 Tangible 2 Intangible Shareholders’ Equity Current LiabilitiesLong-Term Debt What long-term investments should the firm engage in?The Capital Budgeting Decision
4. The Balance-Sheet Model of the FirmHow can the firm raise the money for the required investments?The Capital Structure Decision Current Assets Fixed Assets 1 Tangible 2 Intangible Shareholders’ Equity Current LiabilitiesLong-Term Debt
5. The Balance-Sheet Model of the FirmHow much short-term cash flow does a company need to pay its bills? The Net Working Capital Investment DecisionNet Working Capital Current Assets Fixed Assets 1 Tangible 2 Intangible Shareholders’ Equity Current LiabilitiesLong-Term Debt
6. 27.1 Tracing Cash and Net Working CapitalCurrent Assets are cash and other assets that are expected to be converted to cash with the year. Cash Marketable securities Accounts receivable Inventory Current Liabilities are obligations that are expected to require cash payment within the year. Accounts payable Accrued wages Taxes
7. 27.2 Defining Cash in Terms of Other ElementsNet Working Capital+Fixed Assets=Long-Term Debt+EquityNet Working Capital=CashOther Current AssetsCurrent Liabilities+–Cash=Long-Term Debt+Equity–Net Working Capital (excluding cash)Fixed Assets–
8. 27.2 Defining Cash in Terms of Other ElementsAn increase in long-term debt and or equity leads to an increase in cash—as does a decrease in fixed assets or a decrease in the non-cash components of net working capital. The Sources and Uses of Cash Statement follows from this reasoning.Cash=Long-Term Debt+Equity–Net Working Capital (excluding cash)Fixed Assets–
9. 27.3 The Operating Cycle and the Cash CycleTimeAccounts payable periodCash cycleOperating cycleCash received Accounts receivable periodInventory periodFinished goods soldFirm receives invoiceCash paid for materialsOrder PlacedStock ArrivesRaw material purchased
10. 27.3 The Operating Cycle and the Cash CycleIn practice, the inventory period, the accounts receivable period, and the accounts payable period are measured by days in inventory, days in receivables and days in payables. Cash cycle=Operating cycle–Accounts payable period
11. 27.4 Some Aspects of Short-Term Financial PolicyThere are two elements of the policy that a firm adopts for short-term finance. The Size of the Firm’s Investment in Current Assets Usually measured relative to the firm’s level of total operating revenues. Flexible Restrictive Alternative Financing Policies for Current Assets Usually measured as the proportion of short-term debt to long-term debt. Flexible Restrictive
12. The Size of the Investment in Current AssetsA flexible policy short-term finance policy would maintain a high ratio of current assets to sales. Keeping large cash balances and investments in marketable securities. Large investments in inventory. Liberal credit terms. A restrictive short-term finance policy would maintain a low ratio of current assets to sales. Keeping low cash balances, no investment in marketable securities. Making small investments in inventory. Allowing no credit sales (thus no accounts receivable).
13. Carrying Costs and Shortage Costs$Investment in Current Assets ($)Shortage costsCarrying costsTotal costs of holding current assets.CA*Minimum point
14. Appropriate Flexible Policy$Investment in Current Assets ($)Shortage costsCarrying costsTotal costs of holding current assets.CA*Minimum point
15. When a Restrictive Policy is Appropriate$Investment in Current Assets ($)Shortage costsCarrying costsTotal costs of holding current assets.CA*Minimum point
16. Alternative Financing Policies for Current AssetsA flexible short-term finance policy means low proportion of short-term debt relative to long-term financing. A restrictive short-term finance policy means high proportion of short-term debt relative to long-term financing.
17. Alternative Financing Policies for Current AssetsIn an ideal world, short-term assets are always financed with short-term debt and long-term assets are always financed with long-term debt. In this world, net working capital is always zero.
18. Financing Policy for an Idealized EconomyLong-term debt plus common stock$Time0 1 2 3 4 5Current assets = Short-term debtFixed assets: a growing firmGrain elevator operators buy crops after harvest, store them, and sell them during the year. Inventory is financed with short-term debt. Net working capital is always zero.
19. 27.5 Cash BudgetingA cash budget is a primary tool of short-tun financial planning. The idea is simple: Record the estimates of cash receipts and disbursements. Cash Receipts Arise from sales, but we need to estimate when we actually collect. Cash Outflow Payments of Accounts Payable Wages, Taxes, and other Expenses Capital Expenditures Long-Term Financial Planning
20. 27.5 Cash BudgetingThe cash balance tells the manager what borrowing is required or what lending will be possible in the short run.
21. 27.6 The Short-Term Financial PlanThe most common way to finance a temporary cash deficit to arrange a short-term loan. Unsecured Loans Line of credit down at the bank Secured Loans Accounts receivable financing can e either assigned or factored. Inventory loans use inventory as collateral. Other Sources Banker’s acceptances Commercial paper.
22. 27.7 Summary & ConclusionsThis chapter introduces the management of short-term finance. We examine the short-term uses and sources of cash as they appear on the firm’s financial statements. We see how current assets and current liabilities arise in the short-term operating activities and the cash cycle of the firm. From an accounting perspective, short-term finance involves net working capital.
23. 27.7 Summary & ConclusionsManaging short-term cash flows involves the minimization of costs. The two major costs are: Carrying costs—the interest and related costs incurred by overinvesting in short-term assets such as cash Shortage costs—the cost of running out of short-term assets. The objective of managing short-term finance and short-term financial planning is to find the optimal tradeoff between these two costs.
24. 27.7 Summary & ConclusionsIn an ideal economy, the firm could perfectly predict its short-term uses and sources of ash and net working capital could be kept at zero. In the real world, net working capital provides a buffer that lets the firm meet its ongoing obligations. The financial manager seeks the optimal level of each of the current assets.
25. 27.7 Summary & ConclusionsThe financial manager can use the cash budget to identify short-term financial needs. The cash budget tells the manager what borrowing is required or what lending will be possible in the short run.