Cash Ain’t Cash Unless It’s Cash

“Where’s the money?” I asked.

Luis squinted. “What do you mean, where’s the money?”

“Look, you asked me to help you straighten out this mess. Where’s the money?” I repeated.

“We have a cash-flow problem, there isn’t any money,” Luis replied.

“Yes, there is a cash-flow problem, there is always a cash-flow problem. Luis, the first resource a manager has to manage is cash. But before you can manage it, you have to find out where it is. Sometimes you think you know where it should be, but if that’s not where it is, you can’t manage it.

Sometimes your cash is tied up in a machine. Sometimes your cash is tied up in unbilled work-in-process. Sometimes your cash is tied up in Accounts Receivable. Once you find out where your cash is, only then can you manage it. So, where’s the money?”

A raw nerve was struck. Luis shuffled some papers on his desk. “It’s here,” he said, pointing to the third column in his A/R aging report. “It’s over 60.”

“Well, now we know where it is, we can manage it.”
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Registration for our online program Hiring Talent – 2016 is CLOSED out. No worries. We will offer another class the first part of March.
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Today’s post was inspired by a quote from the late Red Scott, “Cash ain’t cash unless it’s cash.”

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