Financial Planning, Budgeting, and Forecasting: Financial Intelligence Collection (7 Books)

26

The Magic of Managing theBalance Sheet

We’ve mentioned the phrase managing the balance sheet a couple of times in this book. Right now we want to go into greater detail about how to do it. The reason? Astute management of the balance sheet is like financial magic. It allows a company to improve its financial performance even without boosting sales or lowering costs. Better balance sheet management makes a business more efficient at converting inputs to outputs and ultimately to cash. It speeds up the cash conversion cycle, a concept that we’ll take up later in this part. Companies that can generate more cash in less time have greater freedom ...