Outlook Towards Maintenance of Liquid Assets to Ensure

How to maintenance of liquid assets to ensure frm has adequate coin? Asking the above-referenced question without statistics makes it impossible for bothone to give you a proper answer. largely speaking, you must limit expenses and ensure that some of your assets are in the represent of in brief term assets. The higher your short term assets and the less your short term debt, the better your ability to pay the debt (short term liquidity dimension / liquidity ratio help you determine this). There is no hone number or ratio for every firm. Each industry/ commercial enterprise is unique.Strive to control debt (some debt is very good since it helps a task grow) and to maintain generous assets in the form of cash and cash equivalents Companies (Acceptance of Deposits) Rules, 1975 Maintenance of liquid assets (1) all comp whatever shall, before the 30th sidereal mean solar day of April of each year, deposit or invest, as the case may be, a sum which shall not be less than 23fif teen per cent of the tot up of its deposits maturing during the year ending on the 31st day of March next following in any one or more of the following methods, namely a) in a current or other deposit account with any scheduled bank, free rout out of lien (b) in unencumbered securities of the Central Government or of any State Government (c) in unencumbered securities mentioned in articles (a) to (d) and (ee) of section 20 of the Indian Trusts Act, 1882 (2 of 1882) 24(d) in unencumbered bonds issued by the Housing Development pay Corporation Limited, Bombay, a company incorporated at a lower place the Companies Act, 1956 (1 of 1956), and notified under clause (f) of section 20 of the Indian Trusts Act, 1882 (2 of 1882) 5Provided that with relation to the deposits maturing during the year ending on the 31st day of March, 1979, the sum required to be deposited or invested under this sub-rule shall be deposited or invested before the 2630th day of September, 1978. Explanation. F or the purpose of this sub-rule, the securities referred to in clause (b) or clause (c) shall be reckoned at their market value. 2) The amount deposited or invested, as the case may be, under sub-rule (1), shall not be utilize for any purpose other than for the repayment of deposits maturing during the year referred to in that sub-rule, provided that the amount remaining deposited or invested, as the case may be, shall not at any time fall below 23fifteen per cent of the amount of deposits maturing until the 31st day of March of that year. Maintainence of Liquidity in Business One of the principal aims of a conductor is the maintenance of liquid assets.Maintenance of liquid assets connotes that the firm al personal manners has comme il faut cash in hand to pay for 1. Recurring Expenses 2. To make out of the blue(predicate) large purchases 3. To meet emergencies at all times The best way to maintain a cash flow is to prevent overdue accounts and avoid a blockage in the inflow o f income. The ideal way to do this would be avoiding doing business with customers who have proven bad credit histories however, on the other hand rigid customer policies limiting the firms business with companies having exactly irreproachable credit records would deplete the firms pool of potential customers.With the Management flavor at expanding the business it becomes necessary to do business with most pile who want to do business with you. The reality of a growing business is that the biggest and best clients also want sufficient billing period and because ask for two months time for making payments. Here is where the Manager is caught surrounded by two horns. While the firm does not want to lose clients or destroy any potential or established business relationships by laying down harsh payment terms, it is also necessary for the Manager to take some control of accounts receivable to avoid causing pandemonium with the cash flow.Expansion of business requires extension of credit and when a firm extends credit, it is in effect loaning customers money, which in turn affects liquidity as any company wants to be reasonably sure that the money will be paid back. The primary step towards maintenance of liquid assets therefore commences with arrest of customer credit worthiness. Certain steps can be taken to check whether the customer is good enough on his payments- 1. enclose each companys credit history before extending credit. 2. encounter how long the company has been in business. 3. Obtain Credit Reports as they generate historical payment data bankruptcy records any