Companies have increased their cash and short-term investment balances in Q212, according to the AFP Corporate Cash Indicators (AFP CCI), a quarterly study that measures recent and anticipated changes in US corporate cash balances. Quarter-to-quarter, 38% of reporting organisations had greater cash balances at the end of Q212 than they had at the end of Q112, compared with 29% that shed cash during the period.
The difference, a net index reading of +10, was down three points from the March 2012 survey and off 14 points from six months earlier.
Year-over-year, cash hoarding increased, with 40% of companies reporting larger balances at the end of Q212 than they had at the end of the Q211, with a resulting net index reading of +15, up two points from the April 2012 survey.
Over the next three months, treasurers expect the growth in corporate cash balances to continue to slow, with only 31% of organisations anticipating a build-up of cash reserves and 27% expecting to reduce balances. The net index reading of +4 is down four points from the April 2012 survey and 13 points from a year earlier.
AFP began collecting quarterly data in January 2011 and has now collected six data sets. The next set will be published in the 15 October 2012 issue of
AFP EconWatch newsletter
Cash-flow based metrics now feature prominently alongside traditional revenue measures of business performance in the key figures or financial summary pages of any public company.
With the end of 2017 fast approaching, many finance professionals might be counting down the days with some degree of dread. Year End is just around the corner and with it comes the many long hours accountants will spend going over balance sheets and profit and loss accounts, investigating account irregularities and chasing sign offs.
The EU and US’ shift in accounting standards may bring balance sheet losses and increase credit risk, according to James Elder, director of risk services at Standard & Poor’s (S&P) Global.
The US dollar and debt yields falling on the North Korea missile test, treasury being a top target for cyber criminals and why treasurers aren't into real-time payments all hit the latest headlines in the world of treasury this week. Don't miss our ten top news stories from around the world.