The Research Of Risk And Control In The Operation Of The Cash In Central Bank

Finance is the axis of economic development while currency is the blood of thesociety. As the most traditional and most important form of money, cash is not only themain form of commodity circulation but also an important index that can measure andreflect economic, overall situation of social and financial development, the healthinessdegree of institution, rationality of structure and so forth. That is why it is significant toensure successful operation of cash.This paper takes operational risks of cash in the People’s Bank of China as researchobject. The topical subject is analysis and controlling of operational risks of cash. First ofall, it elaborates relevant concepts, institutions and basic situation of cash in our country.Secondly, we identify and assess the risks and divide cash risks into structural risk andmanagement risk. We can find the main cash risk through the analysis of various kinds ofrisk happened in the case of notes. Thereafter, we study operational risks of cash from thereasons, form and particularity, and then, we apply time series analysis to predict the totalcash demand in next few years. In respect of international reference, this paper analyzesthe situation of operation management in Bundesbank, taking which as the reference ofcash risk management in China’s central bank. Finally, aiming at the main risk in theoperation of the cash, we bring forward the countermeasures and suggestion in terms oforganization, institution, technology and emergency management.