ANALYSIS OF CASH MANAGEMENT OF PT XYZ IN KARAWANG
This research discusses about cash management of PT XYZ that is engaged in the manufacturing of mechanical structural steel tubes in Karawang, West Java, Indonesia. After having a problem in working capital management on 2014, responsively, the Financial Manager of PT XYZ tried to rearrange the w...
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| Format: | Final Project |
| Language: | Indonesia |
| Online Access: | https://digilib.itb.ac.id/gdl/view/41108 |
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| Institution: | Institut Teknologi Bandung |
| Language: | Indonesia |
| Summary: | This research discusses about cash management of PT XYZ that is engaged in the manufacturing of
mechanical structural steel tubes in Karawang, West Java, Indonesia. After having a problem in working
capital management on 2014, responsively, the Financial Manager of PT XYZ tried to rearrange the
working capital management of PT XYZ. It results a well-managed inventory, account receivable, and
account payable of the company. However, in 2016-2017, the value of current ratio, quick ratio, and
cash ratio of PT XYZ is far above the average companies in the same industry. This indicates that PT
XYZ hasn’t used its current assets or cash efficiently. To solve this problem, the researcher decided to
use an approach method since there has been no study that discusses the required cash for carrying out
company operations. This approach method consists of benchmarking analysis using cash ratio and pro
forma financial statement, financial ratio analysis, and funding strategy analysis so the researcher could
find out the cash required by PT XYZ and the impact of cash management implementation towards PT
XYZ performance. The researcher also proposed the total cost of each funding strategy to know the
most efficient management funding strategy that could be applied by PT XYZ. From the analysis that
has been done, the researcher found the monthly cash requirement of PT XYZ and as the result, the
cash management implementation will give an increase to both return on assets and total assets turnover,
but a decrease to liquidity ratio. The funding strategy that is better implemented by PT XYZ is
aggressive strategy because of the total cost is less costly compared to the conservative strategy.
However, the decision to choose the funding strategy is rely on the risk characteristic of management
and its banking relations. |
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