Cash holdings

The cash position is in the economics of when economic agents currently available cash and cash equivalents .

General

Economic subjects are companies , private households , the state and its subdivisions ( public administration , state-owned companies ). Means of payment in the narrower sense are cash ( cash in hand ), book money ( bank balance ) and money substitutes ( checks , bills of exchange ). In a broader sense defined IAS 7 .6 (2017) to the cash inventory as a sum of the cash available ( English cash ) and cash equivalents ( English cash equivalents ). Cash equivalents are very liquid assets , show hardly any fluctuations in value and have terms of a maximum of three months (IAS 7.7). This includes the short-term receivables ( accounts receivable ) minus the short-term liabilities ( accounts payable ) , which together with the cash and cash equivalents make up the financial assets : ${\ displaystyle F_ {k}}$ ${\ displaystyle V_ {k}}$ ${\ displaystyle ZMB}$ ${\ displaystyle G}$

{\ displaystyle G = ZMB + F_ {k}}

- .

{\ displaystyle V_ {k}}

The stocks of ready-to-sell finished goods or securities are not part of the financial assets.

Changes in the cash balance

The terms deposit and withdrawal belong to the means of payment level (it considers flows ) . The stock of cash and cash equivalents is a stock quantity that is increased by the payment flow variable ( ) and decreased by the payment flow variable ( ). The cash balance is the amount of cash determined at a certain point in time : ${\ displaystyle E}$ ${\ displaystyle A}$ ${\ displaystyle ZMB}$ ${\ displaystyle _ {t}}$

{\ displaystyle ZMB_ {t} = E_ {t} -A_ {t}}

.

The balance of payments in and out of a certain period results in a cash surplus (or a cash deficit in the negative case):

{\ displaystyle {\ text {Excess payment}} = E_ {t}> A_ {t}}

,

{\ displaystyle {\ text {Means of payment deficit}} = E_ {t} <A_ {t}}

.

These flow variables change the size of the cash and cash equivalents, which has a direct effect on liquidity and cash flow . Deposits increase both, withdrawals decrease them. A cash surplus is also referred to as a raw cash surplus ; the negative case is called the gross deficit .

Relationship between spend / payout

The terms income and expenditure belong to the level of financial assets (it considers stock sizes ) . Expenditures and payments are always identical if both the cash and cash equivalents change. For example, the business transaction involving the cash payment of a purchase of goods leads to a reduction in cash on hand and thus to a reduction in financial assets.

   Zahlungsmittelbestand  (-)
   + Forderungen          (0)
   - Verbindlichkeiten    (0)
   = Geldvermögen         (-)

Payouts and expenses, on the other hand, are not identical when credit transactions take place. If the purchase of goods is made with a payment term , this supplier credit increases the creditors (liabilities) and leads to a reduction in financial assets. There is then an issue, but the payment is only made when the payment term has expired through the availability of means of payment.

   Zahlungsmittelbestand  (0)
   + Forderungen          (0)
   - Verbindlichkeiten    (+)
   = Geldvermögen         (-)

Expenditure-free payments reduce cash and cash equivalents and liabilities or increase other receivables. When a debtor pays a liability, both his cash and cash equivalents and his liabilities decrease. His net financial assets therefore remain unchanged: payment, but no expenditure. The cash purchase of a government or corporate bond reduces the cash holdings, but increases the other receivables. Here too, the net financial assets remain unchanged (payment, no issue). Unpaid expenses, on the other hand, do not affect the cash balance and only change financial assets. This includes the purchase of goods on payment terms. This increases the buyer's liabilities, but his cash and cash equivalents remain unchanged (issue, but no disbursement) until the liability from the purchase (payment) has been fulfilled.

Income / Deposit Relationship

The opposite also applies to the terms income and payments. They take place at the same time when a transaction changes both the cash balance and the financial assets. For example, a cash sale of goods leads to an income and a deposit because both the cash on hand and the financial assets increase:

   Zahlungsmittelbestand  (+)
   + Forderungen          (0)
   - Verbindlichkeiten    (0)
   = Geldvermögen         (+)

An example in which receipt and payment do not take place at the same time would be e.g. B. a customer loan through prepayment . The early payment by the customer before delivery leads to the payment by increasing the cash balance and the increase in liabilities, the income is only made through the later sales-effective delivery:

   Zahlungsmittelbestand  (+)
   + Forderungen          (0)
   - Verbindlichkeiten    (+)
   = Geldvermögen         (0)

Income without income occurs when the cash balance is increased and is associated with a decrease in receivables or an increase in liabilities. This includes the repayment of a loan by the debtor , whereby the creditor receives means of payment and can write off his credit claim. Non- cash income arises from business transactions that do not affect the cash balance (e.g. the sale of finished products on payment terms ).

Individual evidence

↑ Torsten Wengel, bookkeeping compact , 2007, p. 112
↑ Claus Luttermann / Bernhard Großfeld, Accounting Law , 2005, p. 304
^ Peter Janakiew, Unternehmensführung-Accounting-Controlling , 2009, p. 123
↑ Josef Reimann / Burkhard Fry: [ https://www.topagrar.com/archiv/Wie-haben-mein-Betrieb-finanziell-da-147890.html?action=download How is my company financially?], [Top agrar], 2000, No. 2 p. 46
^ Peter Janakiew, Unternehmensführung-Accounting-Controlling , 2009, p. 124
↑ Frank Kalenberg, Kostenrechnung , 2013, p. 6
^ Carl-Christian Freidank, cost accounting , 2012, p. 12
^ Günter Wöhe : Introduction to general business administration . Munich: Vahlen 1993, pp. 1006-1016
^ Carl-Christian Freidank, Kostenrechnung , 2012, p. 20; Further examples for payments without income, income without payments, expenses without payments and payments without expenses in Günter Wöhe: Introduction to general business administration . Munich: Vahlen 1993, pp. 1006-1011

[1] Torsten Wengel, bookkeeping compact , 2007, p. 112

[2] Claus Luttermann / Bernhard Großfeld, Accounting Law , 2005, p. 304

[3] Peter Janakiew, Unternehmensführung-Accounting-Controlling , 2009, p. 123

[4] Josef Reimann / Burkhard Fry: [ https://www.topagrar.com/archiv/Wie-haben-mein-Betrieb-finanziell-da-147890.html?action=download How is my company financially?], [Top agrar], 2000, No. 2 p. 46

[5] Peter Janakiew, Unternehmensführung-Accounting-Controlling , 2009, p. 124

[6] Frank Kalenberg, Kostenrechnung , 2013, p. 6

[7] Carl-Christian Freidank, cost accounting , 2012, p. 12

[8] Günter Wöhe : Introduction to general business administration . Munich: Vahlen 1993, pp. 1006-1016

[9] Carl-Christian Freidank, Kostenrechnung , 2012, p. 20; Further examples for payments without income, income without payments, expenses without payments and payments without expenses in Günter Wöhe: Introduction to general business administration . Munich: Vahlen 1993, pp. 1006-1011