Genesis Cash Position
To: Manager XYZ
From: <Name>
Date: <Date>
Subject: Cash position analysis of the organization
CC: Faculty Advisors, President
It is known that now the organization is going to implement some of the expansion plans
that have been discussed in the last meeting. For the expansion plan, the first step to evaluate is
the cash position of the organization and to understand the extent of financing needed for the
expansion plan.
Till now, we did not have any kind of problem in terms of cash position and hence
external financing was not at all needed. But when are talking about the new expansion plans, it
is important to understand the cash needed initially for the expansion and the cash flows once
everything has been implemented.
Also another important factor to consider would be the source of financing that the
organization can look for. There can be three types of financing that we can evaluate:
Debt
Equity
Mix of the two
Also the financing has to be reliable since we are planning for foreign expansion. The
financing can be done with for short term or for the long term. This factor is also evaluated in the
present discussion.
The first step is to analyze the cash flows in the initial years. For the same, monthly and
the quarterly budget has been prepared that would help the organization to understand the cash
flows in the various months.
Sales: Sales has been forecasted for the organization according to the past history and the
future market plans for the organization. The sales are set to remain volatile according to the
management and the same is shown in the table.
Dec Jan Feb March April
Cash Inflow
Sales 300,000 200,000 350,000 400,000 500,000
May June July Aug Sept Oct Nov Dec
550,000 700,000 700,000 650,000 900,000 850,000 750,000 500,000
