Cash Management
Applying cash monitoring and budgeting techniques to predict and manage the organization’s cash generation and utilization.
Level 1. Demonstrates introductory understanding, directing people to the appropriate source for further information.
BEHAVIORS
- Describes the basic cash handling procedures.
- Processes payments and receipts using the organization’s cash management policies.
- Prepares basic reports on historical cash flow for input into future cash flow planning.
- Articulates the basic cash forecast requirements.
QUESTIONS
- Describe when you were responsible for processing incoming or outgoing payments.
Probing Questions
* What policies or procedures did you use?
* What did you do when the transaction did not match with the organization's policies?
* Whose guidance did you seek?
* What was the result?
- Describe when you were involved in cash flow reporting.
Probing Questions
* What policies or procedures did you use?
* How did you monitor and communicate cash flow information?
* How did you ensure the accuracy of your work?
* What was the result?
Level 2. Applies the competency in common situations that present limited difficulties, working with a moderate level of guidance.
BEHAVIORS
- Describes the basic tools and techniques used to monitor/track the generation and utilization of cash.
- Describes the activities that impact significantly (both positively and negatively) cash flow.
- Manages cash collection and disbursements, while reflecting upon the previously communicated optimum cash position.
QUESTIONS
- Describe a time when you avoided cash flow problems by applying the organization's policies.
Probing Questions
* What were your role and responsibilities?
* What was the potential problem?
* How did you apply the policies to avoid the potential problem?
* How did the application of the policies avoid the problem?
Level 3. Applies the competency in the full range of typical situations, requiring guidance in only the most complex or new situations.
BEHAVIORS
- Prepares periodic cash flow statements and projections without assistance.
- Explains in common terms the intricacies and implications of various cash payout and collection systems/activities.
- Produces reports or presentations that outline and explain financial risk management results associated with cash management.
QUESTIONS
- Describe cash flow prediction tools you have used or developed.
Probing Questions
* How did you predict cash flow?
* What resources did you use?
* How did you monitor performance against predictions?
* What was the result?
- Describe an unusual cash payout or collection system in which you were involved.
Probing Questions
* What was the system?
* How was it unusual?
* What action did you take to address the issue? What was the impact of the system on the organization's cash flow?
Level 4. Applies the competency in new or complex situations and advises others.
BEHAVIORS
- Analyses cash flow projections, recommending optimum short and long term cash positions.
- Develops cash management solutions - cash monitoring and budgeting techniques - to meet the organization’s needs.
- Plans financial risk management strategies, techniques, models and tools related to cash management.
- Coaches others on cash management concepts, strategies, techniques, and tools.
QUESTIONS
- Describe a time when you recommended a cash flow solution that optimized the organization's cash position.
Probing Questions
* What were the circumstances?
* How did scope the cash flow problem?
* How did you arrive at your recommendation?
* What was the result?
- Describe a time when you coached someone on predicting cash flow.
Probing Questions
* What were your responsibilities?
* What was the circumstance?
* How did you approach the coaching situation?
* How did you evaluate whether the coaching was effective?
Level 5. Develops new approaches and methods in the area. Is recognized as an expert within the organization.
BEHAVIORS
- Sets financial risk management strategy for cash management across the organization.
- Negotiates alternatives for cash flow issues, including negotiation of short-term credit facilities and/or short-term excess cash placements.
- Develops policies and procedures around interest rates, management of operating cash on hand, and foreign exchange across the organization.
- Leverages cash flow analysis in order to make financing decisions needed to ensure appropriate cash flow in the future.
QUESTIONS
- Describe a time when you negotiated short term cash alternatives.
Probing Questions
* What were your roles?
* What were the circumstances?
* What factors did you take into consideration?
* Whose input did you seek?
- Describe a time when you had to explain cash flow impacts to non-financial managers.
Probing Questions
* What was your role?
* What was the circumstance?
* How did you approach it?
* What tools did you use?