Sample interview questions: How do you ensure effective cash positioning and funding for daily operations?
Sample answer:
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Cash Flow Forecasting:
- Develop accurate cash flow forecasts to predict daily, weekly, and monthly cash needs.
- Regularly review and update forecasts based on actual cash inflows and outflows.
- Use scenario analysis to assess the impact of different factors on cash flow, such as changes in sales, expenses, or investments.
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Bank Relationship Management:
- Cultivate strong relationships with banks and financial institutions to secure favorable terms and conditions for borrowing and other financial services.
- Negotiate credit lines, revolving loans, and other financing arrangements to ensure sufficient funding for daily operations.
- Monitor bank balances and maintain compliance with loan covenants and restrictions.
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Investment Management:
- Invest surplus cash in short-term, liquid investments to generate returns while maintaining access to funds.
- Diversify investments to minimize risk and maximize returns.
- Continuously monitor investment performance and adjust the portfolio as needed.
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Cash Concentration and Disbursement:
- Implement efficient cash concentration strategies to centralize cash from various operating units and subsidiaries.
- Automate cash disbursements to streamline payments and minimize manual processing.
- Utilize electronic funds transfer (EFT) and other electronic payment methods to expedite payments and reduce costs.
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Risk Management:<... Read full answer