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EVALUATING CASH FLOW SYSTEMS UNDER GROWTH
Author(s) -
Lanser Howard P.,
Halloran John A.
Publication year - 1986
Publication title -
financial review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.621
H-Index - 47
eISSN - 1540-6288
pISSN - 0732-8516
DOI - 10.1111/j.1540-6288.1986.tb01126.x
Subject(s) - cash flow , component (thermodynamics) , acceleration , residual , computer science , cash flow forecasting , econometrics , mathematics , economics , algorithm , finance , physics , classical mechanics , thermodynamics
This paper considers a potential extension and refinement of the type of cash flow analysis of cash management systems commonly found in financial management texts. The timing effect of a cash management system has three distinct components—overlap, acceleration, and residual. However, only the overlap component is explicitly quantified by the standard evaluation procedure. Conditions are specified under which quantification of an additional component (acceleration) can significantly improve the accuracy of the estimates.