ge内部高层培训资料（现金流管理）cash_is_the_king_&_quality_of_earning

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1、PrivilegedandConfidentialTotalCashGenerated&QualityOfEarningsCashReallyIstheNextBigInitiativeinThisCompany,andIt’sanInitiativeWithConsequence,BecauseWeCannotGetItWrong(Immelt)NumbersAreImportant,butManagingIsAbouttheBusinessesandNotEarnings. FollowtheCashFlow(Welch)NetIncomeIsanArt.Cash

2、IsCountable(Welch)CashFlowIsWidelyPerceivedtoBetheHardestNumberintheFinancialStatementtoMonkeyWith.IfCashIsGrowingataComparableRatetoNetIncome,It'saSignThattheNetIncomeNumberHasn'tBeenFudged(BusinessWeek)“NoOperatingLeaderHasaClueWhatTheirCashIs;OnlytheFinanceManagerKnows.”(Immelt)WhyTh

3、eFocusOnCashNetIncomeTheCashModelWorkingCapital(ShortTermAssets,Liabilities)…AccountsReceivableInventoryAccountsPayableProgressCollectionsOtherAssets&Liabilities…DeferredCharges(e.g.MSA)CapitalizedEngineeringReserves,WarrantiesTotalCashGeneratedInTheEnd,NetIncomeShouldEqualCash…Anything

4、LessIsPoorQualityOfEarnings-P&E,SoftwareSpend+Depreciation&AmortizationReinvestmentRatioLessThan1.0WorkingCapitalGoal…Minimize(Zero!)WorkingCapitalWorkingCapital=CurrentAssetsAccountsReceivable+Inventory-CurrentLiabilitiesAccountsPayable+ProgressCollectionsWhenWeGROWAnAsset,WeAreUSINGCa

5、shWhenWeREDUCEAnAsset,WeAreGENERATINGCashWhenWeGROWALiability,WeAreGENERATINGCashWhenWeREDUCEALiability,WeAreUSINGCashImpactOnCashWorkingCapitalExampleReceiveA$2MMOrderInventory=$1.5MMMarginOnTheDeal=$0.5MMNoProgressCollections30DayPayableTerms30DayCollectionsTermsKeyBusiness

6、Processes…TheWorkingCapitalBusinessModelReceiveOrderAccountsReceivableAccountsPayableInventoryProgressCollectionsSourceUse…AndWorkingCapitalImpactCurrentAssetsCurrentLiabilitiesImpactOnCashCashCounter:AccountMovementKeyBusinessProcesses…TheWorkingCapitalBusinessModelReceiveOrderBuyMater

7、ialMnf’gBuildInventoryGeneratePayableAccountsReceivableAccountsPayableInventoryProgressCollectionsSourceUseAccountMovement…AndWorkingCapitalImpactCurrentAssetsCurrentLiabilitiesImpactOnCashCashCounter:-1.5+1.5=0KeyBusinessProcesses…TheWorkingCapitalBusinessModelReceiveOrderBuyM