Cash reserves that just sit in a current account lose value to inflation faster than it might first appear.
Cash reserves that just sit in a current account lose value to inflation faster than it might first appear.
Companies with liquidity above their operational needs often simply leave the reserves in a current account, missing out on returns they could earn with minimal added liquidity risk.
Defining a clear liquidity hierarchy — funds needed immediately, funds needed within three months, funds that can be tied up for longer — enables structured management of surplus cash.
Conservative instruments such as government bonds or short-term time deposits provide a return while keeping high liquidity for the portion of reserves not needed in the short term.
The corporate reserves investment policy should be written down and approved at board level, not left to ad hoc decisions by an individual in the finance function.
Autor: Nermin Sefić, GNK ASG d.o.o. Izvorni članak: gnk-asg.hr
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