Analysis On The Problems And Reasons Of Operational Cash Flow Management In W Company

Starting in 2017,Wanda Group began to sell enterprise assets,which caused people's concern about Wanda's cash flow.Later,the third blue bicycle cash flow in the bicycle-sharing industry broke down and collapsed.Then,the P2 P financial management platform thundered one after another because cash flow could not keep up.Then,listed companies' bonds and even some local debts were overdue due due to cash flow.For a time,cash flow risk has suddenly been pushed to the forefront of the storm and become a hot topic of social concern.Under the background of the overall downturn of China's economy,most enterprises will face more or more financial pressure,which will affect the survival of enterprises.Through good cash flow management to prevent and deal with cash flow risks,it has become the real expectation of more and more business leaders.In the past,we always paid too much attention to the profit situation of enterprises.Most people paid more attention to the value of net profit in the statements.They thought that the companies with high net profit were really excellent companies.However,the drawbacks of the financial statement model which only relied on the single accounting profit figure as the focus became more and more obvious.Under the existing accounting principles,there is too much room for professional judgment,excessive earnings management and whitewash profits emerge in endlessly.In the second quarter before Enron's bankruptcy,its publicly disclosed quarterly earnings were$423 million,but the corresponding net cash flow was negative $527 million.Now,recalling the inversion of cash flow and net profit,is it also a sign that Enron is about to die? The net cash flow of operating activities is the core indicator of cash flow,and the analysis of operating cash flow just overcomes the shortage of accounting profit.Because in accounting accrual basis,income and expenditure can be generated without real cash flow,so there is a lot of room for profit manipulation.But cash flow needs to be solid whether to collect or expend cash,and all profit adjustments depending on time for space can not hide in front of it,and the corresponding risks are clear at a glance.Good management is the best way to prevent risks.Good management of operational cash flow can effectively prevent operational cash flow risks.However,due to the long-term neglect,many companies in the process of operating cash flow management have appeared large and small problems.This kind of problem may appear in the system formulation level,also may appear in the implementation level.Therefore,in order to do a good job in cash flow management,first of all,at the level of system design,it is necessary to fully control the risk in accordance with the actual situation of the company,to think ahead of the various operational cash flow problems that may arise in the company,and to formulate corresponding solutions.At the executive level,we should strictly enforce and strengthen supervision to ensure the independence of supervision.Taking W Company as an example,this paper summarizes and analyses the problems found in the process of practice combined with the financial status quo of W Company,puts forward the fundamental problems,and analyzes the causes of the problems.Then it puts forward some suggestions to help enterprises find out the problems and reasons in cash flow management,so that more and more enterprises attach importance to operational cash flow management and strengthen the construction and implementation of operational cash flow management system.It is hoped that this paper will serve as a valuable reference for more experts and scholars to study and care about operational cash flow management,so that more business managers can understand the importance of operational cash flow management,and effectively improve and implement the relevant systems of operational cash flow management in their daily management of enterprises.This paper is mainly divided into five parts.The first part is the introduction,which mainly introduces the research background and significance of this paper.At the same time,it reviews some relevant literature about this paper,and expounds the relevant research methods and ideas,and briefly summarizes the ideas of the full text.The second part is the theoretical overview of this paper.Firstly,it defines and describes the related concepts of operational cash flow,then summarizes the possible risks of operational cash flow,and finally introduces the theoretical basis of the core of this paper-cash flow management.The third part is the introduction of the case,which mainly summarizes the basic situation,operating characteristics and operating cash flow management system of the case W company analyzed in this paper.The fourth part is to put forward the problems and analyze the reasons,mainly combining with the company's financial and non-financial information,specific analysis of W company's operating cash flow management process problems and their causes.The fifth part is to put forward optimization suggestions,mainly for the W company operating cash flow management problems arising in the process of corresponding optimization suggestions.