International cash management practices

In 1996, Ricci and Morrison conducted a survey of Fortune 200 companies to determine the use of several of the cash management techniques discussed in this chapter. Wire transfers, electronic fund transfers, and lock boxes are used to expedite the collection of accounts receivable. Cash pooling and netting are used to minimize interaffiliate fund flows.

Table 15.7 indicates the relative frequencies of these five cash management techniques used by Fortune 200 companies. These companies appear to have a high level of sophistication. More than 80 percent of the respondents use wire transfers often, 50 percent pool their cash often, and almost half net payments and transfer funds electronically often.

Table 15.7 The use of international cash management techniques

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