Cash and cash equivalents
Cash and cash equivalents are the most liquid current assets found on a business's balance sheet. Cash equivalents are short-term commitments "with temporarily idle cash and convertible into a known cash amount". An investment counts to be a cash equivalent when it has a short maturity period of 90 days or less, can be included in the cash and cash equivalents balance from the date of acquisition when it carries an insignificant risk of changes in the asset value. Equity investments are excluded from cash equivalents, unless they are cash equivalents, for instance, if the preferred shares acquired within a short maturity period and with specified recovery date. One of the company's crucial health indicators is its ability to generate cash equivalents. So, a company with high net assets and less cash and cash equivalents can be considered an indication of non-liquidity. For investors and companies cash and cash equivalents are counted to be "low risk and low return" investments and sometimes analysts can estimate company's ability to pay its bills in a short period of time by comparing CCE and current liabilities.
This can happen only if there are receivables that can be converted into cash immediately. However, companies with a big value of cash and cash equivalents are targets for takeovers, since their excess cash helps buyers to finance their acquisition. High cash reserves can indicate that the company is not effective at deploying its CCE resources, whereas for big companies it might be a sign of preparation for substantial purchases; the opportunity cost of saving up CCE is the return on equity that company could earn by investing in a new product or service or expansion of business. Currency Coins Bank overdrafts are considered as financing activities. Where bank borrowings which are repayable on a demand form an integral part of company's cash management, bank overdrafts are considered to be a part of cash and cash equivalents. Cash in saving accounts is for the saving purposes so that they are not used for daily expenses. Cash in checking accounts allow to write checks and use electronic debit to access funds in the account.
Money order is a financial instrument issued by government or financial institutions, used by payee to receive cash on demand. The advantage of money orders over checks is, they are acceptable for payment of personal or small business's debts and can be purchased for a small fee at many locations such as post office and grocery. Petty cash small amount of cash, used for payment of insignificant expenses and the amount of it may vary depending on the organisation. For some entities $50 is adequate amount of cash, whereas for others the minimum sum should be $200. Petty cash funds must be recorded in order to avoid thefts. There is a custodian appointed, responsible for the documentation of petty cash transactions. Treasury bills called "T-bills", are a security issued by the U. S. Department of Treasury, where their purchase lends money to the U. S. government. T- bills are sold in denominations of $1000 up to maximum amount of $5 million and they do not pay any interest rates, but are sold at a discount, their yield being the difference between purchase price and redemption value.
Commercial paper is a bearer document, used by big companies. The minimum amount permitted is ₤100,000 and this form of borrowing is not suitable for certain "entities". Finance companies sell 2/3 of their total commercial paper to the public, but there are some companies which borrow less and sell their commercial paper to "paper dealers" who re-sell the papers to the investors. A "round lot" for paper dealers is ₤250,000. Marketable securities make business look more liquid, since they are included in the calculation of current ratio; these securities are traded on public exchange due to their ready price availability. There are two forms of Marketable Securities: Marketable Equity Securities and Marketable Debt Securities. Money Market funds are similar to checking accounts, but they pay higher interest rates generated on deposited funds. Net asset Value of Money Market funds maintains stable compared to other mutual funds and its share price is constant: $1.00 per share. For businesses, non-profit organizations and many other institutions MMF are effective "vehicle" for cash management.
Short-term government bonds are issued by governments to support government's spending. They are issued in country's domestic currency and in the U. S government bonds include the Saving bond, Treasury bond, Treasury inflation-protected securities and many others. Before investing into government bond investors should take into account political risk and interest rate risk. Cash and cash equivalents are listed on balance sheet as "current assets" and its value changes when different transactions are occurred; these changes are called "cash flows" and they are recorded on accounting ledger. For instance, if a company spends $300 on purchasing goods, this is recorded as $300 increase to its supplies and decrease in the value of CCE; these are few formulas that are used by analysts to calculate transactions related to cash and cash equivalents: Change in CCE = End of Year Cash and Cash equivalents - Beginning of Year Cash and Cash Equivalents. Value of Cash and Cash Equivalents at the end of period = Net Cash Flow + Value of CCE at the period of beginning Current ratio is used to estimate company's liquidity by "deriving the proporti
Finance is a field, concerned with the allocation of assets and liabilities over space and time under conditions of risk or uncertainty. Finance can be defined as the art of money management. Participants in the market aim to price assets based on their risk level, fundamental value, their expected rate of return. Finance can be split into three sub-categories: public finance, corporate finance and personal finance. Matters in personal finance revolve around: Protection against unforeseen personal events, as well as events in the wider economies Transference of family wealth across generations Effects of tax policies management of personal finances Effects of credit on individual financial standing Development of a savings plan or financing for large purchases Planning a secure financial future in an environment of economic instability Pursuing a checking and/or a savings account Personal finance may involve paying for education, financing durable goods such as real estate and cars, buying insurance, e.g. health and property insurance and saving for retirement.
Personal finance may involve paying for a loan, or debt obligations. The six key areas of personal financial planning, as suggested by the Financial Planning Standards Board, are: Financial position: is concerned with understanding the personal resources available by examining net worth and household cash flows. Net worth is a person's balance sheet, calculated by adding up all assets under that person's control, minus all liabilities of the household, at one point in time. Household cash flows total up all from the expected sources of income within a year, minus all expected expenses within the same year. From this analysis, the financial planner can determine to what degree and in what time the personal goals can be accomplished. Adequate protection: the analysis of how to protect a household from unforeseen risks; these risks can be divided into the following: liability, death, disability and long term care. Some of these risks may be self-insurable, while most will require the purchase of an insurance contract.
Determining how much insurance to get, at the most cost effective terms requires knowledge of the market for personal insurance. Business owners, professionals and entertainers require specialized insurance professionals to adequately protect themselves. Since insurance enjoys some tax benefits, utilizing insurance investment products may be a critical piece of the overall investment planning. Tax planning: the income tax is the single largest expense in a household. Managing taxes is not a question of if you will pay taxes, but when and how much. Government gives many incentives in the form of tax deductions and credits, which can be used to reduce the lifetime tax burden. Most modern governments use a progressive tax; as one's income grows, a higher marginal rate of tax must be paid. Understanding how to take advantage of the myriad tax breaks when planning one's personal finances can make a significant impact in which can save you money in the long term. Investment and accumulation goals: planning how to accumulate enough money – for large purchases and life events – is what most people consider to be financial planning.
Major reasons to accumulate assets include purchasing a house or car, starting a business, paying for education expenses, saving for retirement. Achieving these goals requires projecting what they will cost, when you need to withdraw funds that will be necessary to be able to achieve these goals. A major risk to the household in achieving their accumulation goal is the rate of price increases over time, or inflation. Using net present value calculators, the financial planner will suggest a combination of asset earmarking and regular savings to be invested in a variety of investments. In order to overcome the rate of inflation, the investment portfolio has to get a higher rate of return, which will subject the portfolio to a number of risks. Managing these portfolio risks is most accomplished using asset allocation, which seeks to diversify investment risk and opportunity; this asset allocation will prescribe a percentage allocation to be invested in stocks, bonds and alternative investments.
The allocation should take into consideration the personal risk profile of every investor, since risk attitudes vary from person to person. Retirement planning is the process of understanding how much it costs to live at retirement, coming up with a plan to distribute assets to meet any income shortfall. Methods for retirement plans include taking advantage of government allowed structures to manage tax liability including: individual structures, or employer sponsored retirement plans and life insurance products. Estate planning involves planning for the disposition of one's assets after death. There is a tax due to the state or federal government at one's death. Avoiding these taxes means that more of one's assets will be distributed to one's heirs. One can leave one's assets to friends or charitable groups. Corporate finance deals with the sources of funding and the capital structure of corporations, the actions that managers take to increase the value of the firm to the shareholders, the tools and analysis used to allocate financial resources.
Although it is in principle different from managerial finance which studies the financial management of all firms, rather than corporations alone, the main concepts in the study of corporate finance are applicable to the financial problems of all kinds of firms. Corporate f
OCLC Online Computer Library Center, Incorporated d/b/a OCLC is an American nonprofit cooperative organization "dedicated to the public purposes of furthering access to the world's information and reducing information costs". It was founded in 1967 as the Ohio College Library Center. OCLC and its member libraries cooperatively produce and maintain WorldCat, the largest online public access catalog in the world. OCLC is funded by the fees that libraries have to pay for its services. OCLC maintains the Dewey Decimal Classification system. OCLC began in 1967, as the Ohio College Library Center, through a collaboration of university presidents, vice presidents, library directors who wanted to create a cooperative computerized network for libraries in the state of Ohio; the group first met on July 5, 1967 on the campus of the Ohio State University to sign the articles of incorporation for the nonprofit organization, hired Frederick G. Kilgour, a former Yale University medical school librarian, to design the shared cataloging system.
Kilgour wished to merge the latest information storage and retrieval system of the time, the computer, with the oldest, the library. The plan was to merge the catalogs of Ohio libraries electronically through a computer network and database to streamline operations, control costs, increase efficiency in library management, bringing libraries together to cooperatively keep track of the world's information in order to best serve researchers and scholars; the first library to do online cataloging through OCLC was the Alden Library at Ohio University on August 26, 1971. This was the first online cataloging by any library worldwide. Membership in OCLC is based on use of services and contribution of data. Between 1967 and 1977, OCLC membership was limited to institutions in Ohio, but in 1978, a new governance structure was established that allowed institutions from other states to join. In 2002, the governance structure was again modified to accommodate participation from outside the United States.
As OCLC expanded services in the United States outside Ohio, it relied on establishing strategic partnerships with "networks", organizations that provided training and marketing services. By 2008, there were 15 independent United States regional service providers. OCLC networks played a key role in OCLC governance, with networks electing delegates to serve on the OCLC Members Council. During 2008, OCLC commissioned two studies to look at distribution channels. In early 2009, OCLC negotiated new contracts with the former networks and opened a centralized support center. OCLC provides bibliographic and full-text information to anyone. OCLC and its member libraries cooperatively produce and maintain WorldCat—the OCLC Online Union Catalog, the largest online public access catalog in the world. WorldCat has holding records from private libraries worldwide; the Open WorldCat program, launched in late 2003, exposed a subset of WorldCat records to Web users via popular Internet search and bookselling sites.
In October 2005, the OCLC technical staff began a wiki project, WikiD, allowing readers to add commentary and structured-field information associated with any WorldCat record. WikiD was phased out; the Online Computer Library Center acquired the trademark and copyrights associated with the Dewey Decimal Classification System when it bought Forest Press in 1988. A browser for books with their Dewey Decimal Classifications was available until July 2013; until August 2009, when it was sold to Backstage Library Works, OCLC owned a preservation microfilm and digitization operation called the OCLC Preservation Service Center, with its principal office in Bethlehem, Pennsylvania. The reference management service QuestionPoint provides libraries with tools to communicate with users; this around-the-clock reference service is provided by a cooperative of participating global libraries. Starting in 1971, OCLC produced catalog cards for members alongside its shared online catalog. OCLC commercially sells software, such as CONTENTdm for managing digital collections.
It offers the bibliographic discovery system WorldCat Discovery, which allows for library patrons to use a single search interface to access an institution's catalog, database subscriptions and more. OCLC has been conducting research for the library community for more than 30 years. In accordance with its mission, OCLC makes its research outcomes known through various publications; these publications, including journal articles, reports and presentations, are available through the organization's website. OCLC Publications – Research articles from various journals including Code4Lib Journal, OCLC Research, Reference & User Services Quarterly, College & Research Libraries News, Art Libraries Journal, National Education Association Newsletter; the most recent publications are displayed first, all archived resources, starting in 1970, are available. Membership Reports – A number of significant reports on topics ranging from virtual reference in libraries to perceptions about library funding. Newsletters – Current and archived newsletters for the library and archive community.
Presentations – Presentations from both guest speakers and OCLC research from conferences and other events. The presentations are organized into five categories: Conference presentations, Dewey presentations, Distinguished Seminar Series, Guest presentations, Research staff
A promissory note, sometimes referred to as a note payable, is a legal instrument, in which one party promises in writing to pay a determinate sum of money to the other, either at a fixed or determinable future time or on demand of the payee, under specific terms. The terms of a note include the principal amount, the interest rate if any, the parties, the date, the terms of repayment and the maturity date. Sometimes, provisions are included concerning the payee's rights in the event of a default, which may include foreclosure of the maker's assets. For loans between individuals and signing a promissory note are instrumental for tax and record keeping. A promissory note alone is unsecured; the term note payable is used in accounting or as just a "note", it is internationally defined by the Convention providing a uniform law for bills of exchange and promissory notes, but regional variations exist. A banknote is referred to as a promissory note, as it is made by a bank and payable to bearer on demand.
Mortgage notes are another prominent example. If the promissory note is unconditional and saleable, it is called a negotiable instrument. Demand promissory notes are notes that do not carry a specific maturity date, but are due on demand of the lender; the lender will only give the borrower a few days' notice before the payment is due. Promissory notes may be used in combination with security agreements. For example, a promissory note may be used in combination with a mortgage, in which case it is called a mortgage note. In common speech, other terms, such as "loan", "loan agreement", "loan contract" may be used interchangeably with "promissory note"; the term "loan contract" is used to describe a contract, lengthy and detailed. A promissory note is similar to a loan; each is a binding contract to unconditionally repay a specified amount within a defined time frame. However, a promissory note is less detailed and less rigid than a loan contract. For one thing, loan agreements require repayment in installments, while promissory notes do not.
Furthermore, a loan agreement includes the terms for recourse in the case of default, such as establishing the right to foreclose, while a promissory note does not. Promissory notes differ from IOUs in that they contain a specific promise to pay along with the steps and timeline for repayment as well as consequences if repayment fails. IOUs only acknowledge. Negotiable instruments are unconditional and impose few to no duties on the issuer or payee other than payment. In the United States, whether a promissory note is a negotiable instrument can have significant legal impacts, as only negotiable instruments are subject to Article 3 of the Uniform Commercial Code and the application of the holder in due course rule; the negotiability of mortgage notes has been debated due to the obligations and "baggage" associated with mortgages. In the United States, the Non-Negotiable Long Form Promissory Note is not required. Promissory notes are a common financial instrument in many jurisdictions, employed principally for short time financing of companies.
The seller or provider of a service is not paid upfront by the buyer, but within a period of time, the length of, agreed upon by both the seller and the buyer. The reasons for this may vary. Depending on the jurisdiction, this deferred payment period can be regulated by law; when a company engages in many of such transactions, for instance by having provided services to many customers all of whom deferred their payment, it is possible that the company may be owed enough money that its own liquidity position is hampered, finds itself unable to honour their own debts, despite the fact that by the books, the company remains solvent. In those cases, the company has the option of asking the bank for a short-term loan, or using any other such short-term financial arrangements to avoid insolvency. However, in jurisdictions where promissory notes are commonplace, the company can ask one of its debtors to accept a promissory note, whereby the maker signs a binding agreement to honour the amount established in the promissory note within the agreed period of time.
The lender can take the promissory note to a financial institution, that will exchange the promissory note for cash. Once the promissory note reaches its maturity date, its current holder can execute it over the emitter of the note, who would have to pay the bank the amount promised in the note. If the maker fails to pay, the bank retains the right to go to the company that cashed the promissory note in, demand payment. In the case of unsecured promissory notes, the lender accepts the promissory note based on the maker's ability to repay. In the case of a secur