Management of cash the twin objective of financial management liquidity and profitability are kept in mind through the cash balances must be adequate to meet the obligation in the right time a large cash reserve Meri wasteful these fund may be better employed it may not only cash discount but also fail to have better purchased term from the supplier of raw material stores and Other goods at the present stage of the art of financial management the best that can be done is to compare cash balance of a company to its own historical records and use of computer in the industries useful base for comparison are the percentage of cash to Paytm cash to current assets and cash to current liabilities cash for the purpose of the calculation of these ratio cover not only cash in hand or bank but, also short term investment in government securities easily convertible into cash the more the percentage for the company understudy vary from those of the industry the greater should be the attention paid to the cash management it is difficult to judge weather is not a company is sleeping too much cash on hand many financial executive on the side of Executive liquidity as an insurance against unpredictable change in cash but if unforeseen events do not occur it makes the analogies to say that we pay too much for the fire insurance because we do not have fire the problem of cash management can be classified under the following four head controlling level of cash controlling inflow of cash, controlling outflow of cash and optimal investment of surplus cash
