Modelling Economic Crises In Hua He Framework

2021 ◽  
Author(s):  
Nora Felfoeldi-Szuecs ◽  
Peter Juhasz ◽  
Gabor Kuerthy ◽  
Janos Szaz ◽  
Agnes Vidovics-Dancs
Keyword(s):  
Adverse Effects ◽  
Cash Flow ◽  
Cash Transfers ◽  
Economic Environment ◽  
Economic Crises ◽  
Liquidity Management ◽  
Bankruptcy Risk ◽  
Policy Makers ◽  
Credit Lines ◽  
Default Rate

In our paper we model firms’ liquidity using the Hua He methodology. We investigate how cooperation of firms improve the possibilites of liquidity management. During a crisis, various effects identified in the literature hurt firms’ liquidity position and lead to increased bankruptcy risk. We may counterbalance these adverse effects by providing immediate cash transfers and granting periodic cash flow transfers or additional credit lines. Cooperating with peers pays off. The importance of liquidity transfer between agents is higher during a crisis than in normal economic environment. It contributes to a lower default rate the losses are more moderate as well. Several consequences can be drawn for policy makers how ameliorate resilience of agents.

Towards Predicting Financial Failure in Non-Profit Organisations

2016 ◽  
pp. 387-404
Author(s):  
Sharon Cheuk
Keyword(s):  
Adverse Effects ◽  
Financial Distress ◽  
Developing Economies ◽  
Third Sector ◽  
Economic Environment ◽  
Related Factor ◽  
Non Profit ◽  
Investor Confidence ◽  
The Third ◽  
Financial Failure

Non-profit organisation financial failure has been a prevalent problem in developed and developing economies. Such incidences bring adverse effects to the reputation of the non-profit organisation in question and the third sector as a whole, especially if the organisation in question is significantly large in size, leading to possible knock-on effects such as disruption to society, litigation, loss of investor confidence in the economic environment, and a worsening of a country's ranking under the Corruption Perceptions Index. This chapter examines past financial failures amongst non-profits and reviews past literature on attempts to predict non-profit failures before they occur. Finally, it proposes an additional governance-related factor to be taken into consideration when considering potential financial distress amongst non-profit organisations. Suggestions for further research are made accordingly.

scholarly journals Sophia’s choice: Debt, social welfare, and racial finance capitalism

2020 ◽  
pp. 026377582097368
Author(s):  
Erin Torkelson
Keyword(s):  
Lived Experience ◽  
Social Reproduction ◽  
Capital Accumulation ◽  
Cash Transfers ◽  
Cash Transfer ◽  
Western Cape ◽  
Social Scientists ◽  
Developmental Needs ◽  
Policy Makers ◽  
Finance Capitalism

In this article, I examine normative assumptions about cash transfers as public goods and the lived experience of cash transfers as private debts. Policy makers and social scientists often assume cash transfers are apolitical, value-neutral monetary instruments, which improve upon inappropriate, top-down, universalizing development projects. Instead, I show how cash transfers introduce their own universals, by imagining liberal sovereign subjects, who use credit and financial markets to manage their own financial and developmental needs. I argue that this narrative elides the deep historical and geographical production of racial difference through credit and debt in South Africa’s Western Cape farmlands. I call this phenomenon racial finance capitalism. First, I trace how coloured people have been racialized as debtors for the benefit of capital accumulation across generations. Then, I explore how the contemporary spatial and temporal realities of cash transfer distribution continue to racialize grantees as debtors and dispossess them of their social entitlements. Finally, I demonstrate how grantees draw upon transgenerational experiences of debt to challenge the continued social reproduction of themselves as debtors. Some South African social grantees demand recognition that they are, and have been, net creditors to the nation.

Assessing Reserve Adequacy - Further Considerations

Policy Papers ◽  
2013 ◽  
Vol 2013 (89) ◽  
Author(s):  
Keyword(s):  
Policy Framework ◽  
Policy Makers ◽  
Credit Lines ◽  
Crisis Prevention ◽  
Transitory Shocks ◽  
Good Policy ◽  
Market Pressures

Reserves remain a critical liquidity buffer for most countries. They are generally associated with lower crisis risks (crisis prevention) as well as space for authorities to respond to shocks (crisis mitigation). While other instruments, such as official credit lines and bilateral swap lines, are also external buffers, for most countries they principally act as a complement to their official reserves. For countries with sound fundamentals and a good policy framework, reserves provide policy makers with considerable space to respond to transitory shocks. However, this space diminishes as fundamentals deteriorate and the existence of adequate reserves does not, by itself, eliminate the risk of market pressures.

scholarly journals DEVELOPING A COST-PAYMENT COORDINATION MODEL FOR PROJECT COST FLOW FORECASTING / SĄNAUDŲ IR MOKĖJIMO KOORDINAVIMO MODELIO, SKIRTO PROJEKTŲ SĄNAUDŲ SRAUTŲ PROGNOZĖMS, KŪRIMAS

2011 ◽  
Vol 17 (4) ◽  
pp. 494-509 ◽  
Author(s):  
Hong Long Chen ◽  
Wei Tong Chen ◽  
Nai-Chieh Wei
Keyword(s):  
Adverse Effects ◽  
Cash Flow ◽  
Coordination Mechanisms ◽  
Project Cost ◽  
Coordination Model ◽  
General Acceptance ◽  
Operating Cash Flow ◽  
Cash Flow Forecasting ◽  
The Cost ◽  
Over Time

Project operating cash flow forecasting techniques have evolved to enable detailed predictions relating to individual projects. These techniques, principally the cost-schedule integration (CSI) model, extensively use project cost estimates and schedule data. Despite CSI models having gained general acceptance, they have not been without criticism. Such criticism includes the problems of differential schedules between network and cost activities, ignoring the important information of payment conditions composed of payment lags, components, and frequency, and the combined adverse effects of payment irregularity and uniform distribution of cost over time. To resolve and alleviate these problems, this study develops a set of cost-payment coordination mechanisms for creating interaction among cost and payment activities. These mechanisms are then developed into a model. The accuracy of the model is assessed by comparing the historical flows on two case projects. The result shows that the patterns of predicted cost flows created with the model closely match those of the historical flows. Santrauka Su projektų veikla susijusių pinigų srautų prognozavimo metodai atsirado siekiant sudaryti detalias prognozes atskiriems projektams. Šiuose metoduose, o dažniausia sąnaudų ir darbų grafiko integracijos (angl. Cost-schedule integration, CSI) modelyje dažnai naudojamos projektų sąmatos ir duomenys apie darbų grafiką. Nors apskritai sąnaudų ir darbų grafiko integracijos modeliai pripažinti tinkamais, jie buvo kritikuoti, nes kyla problemų dėl skirtingų tinklinių ir su sąnaudomis susijusios veiklos grafikų, taip pat ignoruojama svarbi informacija apie mokėjimo sąlygas, kurias sudaro mokėjimų vėlavimas, komponentai bei dažnis, ir bendrą neigiamą nereguliaraus mokėjimo bei vienodo sąnaudų pasiskirstymo laikui bėgant poveikį. Siekiant šias problemas sumažinti ir išspręsti, šiame tyrime sukuriama sąnaudų ir mokėjimo koordinavimo mechanizmų grupė, sukurianti sąveiką tarp veiklos, susijusios su sąnaudomis ir mokėjimu. Tuomet iš šių mechanizmų sudaromas modelis. Modelio tikslumas įvertinamas lyginant dviejų atvejui tirti pasirinktų projektų srautų istoriją. Rezultatas rodo, kad su modeliu sudarytose sąnaudų srautų prognozėse tendencijos labai artimos realių sąnaudų srautų istorijos tendencijoms.

Liquidity management using Cash Flow at Risk

2008 ◽  
Author(s):  
Biser Stoyanov ◽  
Hans Wilhelm Wieczorrek ◽  
Anatoliy Antonov
Keyword(s):  
At Risk ◽  
Cash Flow ◽  
Liquidity Management

scholarly journals Liquidity Provision and Co-insurance in Bank Syndicates

2021 ◽  
Vol 2021 (060) ◽  
pp. 1-59
Author(s):  
Kevin F. Kiernan ◽  
Vladimir Yankov ◽  
Filip Zikes ◽  
◽  
Keyword(s):  
Banking System ◽  
Assortative Matching ◽  
Corporate Sector ◽  
Liquidity Management ◽  
Liquidity Provision ◽  
Contractual Arrangements ◽  
Credit Lines ◽  
Credit Line ◽  
Liquidity Regulation

We study the capacity of the banking system to provide liquidity to the corporate sector in times of stress and how changes in this capacity affect corporate liquidity management. We show that the contractual arrangements among banks in loan syndicates co-insure liquidity risks of credit line drawdowns and generate a network of interbank exposures. We develop a simple model and simulate the liquidity and insurance capacity of the banking network. We find that the liquidity capacity of large banks has significantly increased following the introduction of liquidity regulation, and that the liquidity co-insurance function in loan syndicates is economically important. We also find that borrowers with higher reliance on credit lines in their liquidity management have become more likely to obtain credit lines from syndicates with higher liquidity. The assortative matching on liquidity characteristics has strengthened the role of banks as liquidity providers to the corporate sector.

scholarly journals Ways to improve minimization of receivables and payments and management by them

2020 ◽  
pp. 26-29
Author(s):  
Olha BONDARENKO ◽  
Iryna MASIUK
Keyword(s):  
Financial Performance ◽  
Cash Flow ◽  
Current Account ◽  
Balance Sheet ◽  
Large Percentage ◽  
Economic Environment ◽  
Accounts Receivable ◽  
Optimal Ratio ◽  
Accounts Payable ◽  
Negative Effect

Introduction. To date, every entity has faced accounts receivable and payable. There are times when debt becomes overdue. An entity cannot repay its debt because debtors do not repay their debt. In fact, receivables and payables are closely linked, which in turn has a negative effect on the balance sheet and financial performance of any counterparty. This article discusses cases of arrears and ways of overcoming (reducing) accounts receivable and payables. The purpose of the paper is to study the factors that influence the increase in accounts receivable and payable within the internal and external activities of the enterprise. Results. In today's economic environment, a large number of Ukrainian enterprises went bankrupt and liquidated because they were unable to pay their debt to creditors. Also this situation arose due to a certain amount of cash, which was in circulation and in time did not enter the current account of the enterprise for payment of accounts payable. On the balance sheet receivables and payables account for a large percentage of both their and others' debt. We'll look at how and under what conditions debt can be reduced. Conclusion. It is advisable to balance receivables and payables in order to control the debt at the enterprise. The constant cash flow should not stop. The debt of the debtors goes to pay off the debt to the creditors. The optimal ratio is when the accounts payable exceeds accounts receivable by 10-20%.

scholarly journals Exploration of Cash Flow Management for Enterprise’s Business Performance

2021 ◽  
pp. 97-105
Author(s):  
Emmanuel Makoji Egwu ◽  
Fausat Ibidunni Orugun ◽  
Abosede Adelakun
Keyword(s):  
Cash Flow ◽  
Management Strategy ◽  
Business Performance ◽  
Management Strategies ◽  
Flow Management ◽  
Policy Makers ◽  
Cash Flow Management ◽  
Financial Obligations ◽  
Improved Performance ◽  
Descriptive Method

The study explored cash flow management for enterprise’s business performance. The study specifically investigated SMEs’ fulfilment of financial obligations through cash flow management, and determines the influence of cash flow management strategy on their performance in FCT Abuja. Survey research design was used. Data were gathered and analysed using the descriptive method and regression analysis. Findings showed that cash flow management influences the fulfilment of financial obligations, and that cash flow management strategies influence the performance of enterprises in Abuja. The study concluded that cash flow is critical to the success of enterprises. The study recommended that owners and managers of enterprises in Abuja should improve on their cash flow management, and that policy makers should incorporate strategy in management of cash flow framework to enhance improved performance.

Internal Capital Markets in Times of Crisis: The Benefit of Group Affiliation*

2019 ◽  
Vol 24 (4) ◽  
pp. 773-811 ◽  
Author(s):  
Raffaele Santioni ◽  
Fabio Schiantarelli ◽  
Philip E Strahan
Keyword(s):  
Cash Flow ◽  
Capital Markets ◽  
Capital Market ◽  
Cash Transfers ◽  
Internal Capital Markets ◽  
Group Affiliation ◽  
Internal Capital Market ◽  
Investment Opportunities ◽  
Internal Capital ◽  
Better Than

Abstract Firms affiliated with business groups survive the stress of the global financial and euro crises better than unaffiliated firms. Using granular data from Italy, we show that better performance stems partly from access to an internal capital market, as the survival value of group-affiliated firms increases with group-wide cash flow. Internal cash transfers increase when banks’ health deteriorates, with funds moving from cash-rich to cash-poor firms and, some evidence suggests, to firms with favorable investment opportunities. Internal capital markets’ role thus increases when external markets (banks) are distressed.

scholarly journals Cash conversion cycle and corporate performance: evidence from Romania

2018 ◽  
Vol 184 ◽  
pp. 04009
Author(s):  
Ciprian Cristea ◽  
Maria Cristea
Keyword(s):  
Regression Analysis ◽  
Multiple Regression Analysis ◽  
Cash Flow ◽  
Stock Exchange ◽  
Negative Relationship ◽  
Management Effectiveness ◽  
Cross Sectional ◽  
Liquidity Management ◽  
Cash Conversion Cycle ◽  
The Relationship

Cash conversion cycle is considered one of the most important measures of management effectiveness, especially the cash flow and liquidity management. This study examines the relationship between cash conversion cycle and corporate profitability for the non-financial companies, from several industries, listed on the Bucharest Stock Exchange for a period of fifteen years from 2002 to 2016. The findings from a cross sectional multiple regression analysis pointed out a negative relationship between cash conversion cycle and the performance of firms. Based on the results from this paper it has been concluded that managers can improve the profitability of their firms by decreasing the number of days in cash conversion cycle.

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