Cash Really Is King: Austerity Measures & Cash Management

May 16, 2012

Between economic woes in general and the recent election of Francois Hollande in France (the first Socialist president there since the other Francois—Mitterrand, that is), austerity measures have become the latest financial hot-button issue.  As budget deficits grow and governments look to shrink them, austerity measures are very divisive, representing cuts in both the quality and quantity of services that the government provides. 

The economic crisis of the late 2000s drove some deficits to record levels and resulted in governments making rather extreme attempts to re-stimulate their national economies.  In both Greece and France, election results reflect the populist notion that austerity measures are not the answer; that belief notwithstanding, many argue that they are here to stay, despite the fact that the newly-elected proclaim that growth—not austerity—is the answer.  While it is most likely that neither extreme is the solution, and no economic recovery of this magnitude is easy, it is important to consider some of the practical implications of these economic realities and the subsequent impact on businesses and individuals.

Whether you’re dealing with austerity measures (budget cuts) and/or are looking to grow, the most important thing to be looking at is managing and maximizing your cash flow.  A recent editorial focus by gtnews on Cash Management Best Practices highlights both the scope and the impact of cash management.  From cash forecasting to automation to charitable giving, “cash management” covers an extremely wide and diverse range of topics, but all with the same goal—helping to weather economically uncertain times.

PORTIA’s Cash Management module supports advanced accounting and record keeping of cash activity using five key components (Cash Balance Schemes, Actual Cash, Cash Forecasting, Cash Views, and Short-Term Investment Vehicles) to provide the most complete and accurate view of current and projected cash availability.  As understanding and managing cash flows grows in importance, PORTIA’s Cash Management module can facilitate this understanding, assist you developing more efficient workflows, and help you focus on the importance of cash as it relates to both budget management and growth.

– Nicole Comeau, Product Manager

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