TH 91

SAN PEDRO COLLEGE OF BUSINESS ADMINISTRATION
Km. 30 Old National Highway, Brgy. Nueva, San

KnPedro City, Laguna
EFFECTS OF LONG TERM DEBT

ON THE CASH MANAGEMENT
AT FORD MOTORS, ALABANG
A Research Presented to the

Deaprtment of Accountancy
San Pedro College of Business Administration
San Pedro City, Laguna
In Partial Fulfilment of the Requirements for the Degree of

Bachelor of Science in Accountancy
BATI – ON, CAMILLE L.

GIEGA, JUDA MAE C.
GONZALES, NIŃO P.
NAME OF THE RESEARCHERS

May 2021
i
ABSTACT
ii
APPROVAL SHEET
iii
ACKNOWLEDGEMENTS
iv
TABLE OF CONTENTS
Title Page i
Abstract ii
Approval Sheet iii
Acknowledgments iv
Table of Contents v
List of Tables vi
List of Figures vii
List of Appendices vii
CHAPTER 1 INTRODUCTION
Background of the Study ` 01
Statement of the Problem 02
Objectives of the Study 03
Conceptual Framework 04
Theoretical Framewrok 05
Hypotheses (if needed) 06
Scope and Limitations 07
Significance of the Study 08
Definition of Terms 09
v
CHAPTER 2 REVIEW OF RELATED LITERATURE AND STUDIES
First topic 10
Second topic 11
Third topic… 12
CHAPTER 3 METHODOLOGY
Research Design 13
Research Setting (if necessary) 14
First step procedure 15
Second step procedure 16
Third step procedure… 17
Data Gathering and Statistical Analysis 18
CHAPTER 4 RESULTS AND DISCUSSIONS
First Specific Objective 19
Second Specific Objective 20
Third Specific Objective… 21
CHAPTER 5 CONCLUSIONS AND RECOMMENDATIONS
Conclusions 40
Recommendations 41
References 43
Appendices 49
Curriculum Vitae 50
vi
LIST OF TABLES
Table Title Page
1 What are the area specialization 23
2 What is the position in the company 24
3 Correlation Analysis 39
vii
LIST OF FIGURES
Figure Title Page
1 Input, Process, Output 06
2 Prefer short term financing….. 25
3 The company is not only focused on profit…. 26
4 Utilization of funds and avoid insolvency 27
5 Unexpected circumstances result of unexpected expenses 28
6 Proper balance in cash on hand and investment 29
7 Plan its cash outflow in such manner that it can earn 30
8 Prohibiting the cash outflow and stimulating the cash inflow 31
9 Long term debt makes profitability difficult to achieve 32
10 Loan over a lengthy period is less affected than short term debt 33
11 Tied to large up- front payouts for major acquisitions 34
12 High debt leverage stifles the organization to engage activities 35
13 Unexpected expenses lessen the budget for long term debt. 36
14 Borrowing large amount of money is required a collateral. 37
15 Long term debt supplement the budget 38
viii
LIST OF APPENDICES
Appendix Title Page
A Survey Questionnaire 45
B Request Letter 49
X Certification
ix
CHAPTER 1
THE PROBLEM AND ITS SETTING
Background of the Study
Year 2020, a major crisis happens in the whole world. This inevitable event that put a lot
of business went to disclosure. The operation of the businesses stops for almost a year and because
of that they cannot pay their debt. Having a long term debt does not secure the future of the business
or success because the future is uncertain. Long term debt has advantages and disadvantages when
it comes to working capital management. One of the advantages is on planning of debt payments
through budgeting because there is a payment schedule being followed. The business can plan
ahead their spending. If it is not yet time for payment, the business can use the money to other
business-related expenses. Business can use amortization table to determine the interest of the
debt, principal amount and the total debt to be paid. One disadvantage of long-term debt related to
working capital is on the interest they will pay. They will pay higher interest because the debt will
be pay for a long period of time. Since there are a lot of expenses that the business will consider,
there is a chance that they might use the budget for payment to other expenses. Especially now
during a pandemic, because of shortage of fund, payment for long term debt will be used to other
day-to-day expenses of the business. There are businesses who cannot pay for their long-term debt
and some lead to bankruptcy and business closure.
1
Cash flow and unexpected expenses are part of cash management of the business. Fund for
long term payment is already budgeted. During pandemic, there are unexpected expenses that the
business need to pay like swab tests for the employees, lesser manpower to comply with the
government’s direction of social distancing and shorter business hours leading to lesser income
and more expenses. Some businesses needed to lay-off some of their employees to save labor
expenses. Because of these unexpected expenses and lesser income, cash management is important
for the business to manage cash flow, spending and payments for long term debt.
The researchers want to know how the companies spend their money for the day to day
operation and how they minimize the expenses and their debt, so it cannot affect to the cash flow
of the company.
Statement of the Problem
The researchers want to investigate the effects of long-term debt on cash management on
Ford Motors in Alabang. In correlation to this, they want to answer the following questions:
1. What is demographic profile of the respondents in terms of:
a. Area of specialization;
b. Position;
c. What is the cash management implemented of the company?
2. What is the effect of long-term debt on cash management as perceived by the respondents?
2
3. Is there significant difference on the effect of long-term debt to the cash management in
Ford Motors, Alabang as perceived by the respondents?
Objectives of the Study
The study's goal is to learn more about the scholars' current research path. Its goal is to
respond to the questions posed in the problem statement. The study's purpose is to find out how
long-term debt effects cash management.
The study's main goal is to figure out how independent variables affect dependent
variables.
To achieve this, the objectives are:
1. To gain a better understanding of how long-term debt affects cash management.
2. Knowing why corporations embrace long-term debt is important.
3. Long-term debt has a significant impact on cash management.
4. How will the corporation deal with the issue brought on by Covid-19?
3
Theoretical framework
Based on the Trade-off theory and pecking order theory this contains about the
capital structure decisions. These theories predict on the relationship between firm performance
and financing decisions. The first theory Trade-off theory based on the work economies
Modigliani and Miller argued that the profitable firm or companies preferred to use debt financing
than the unprofitable firm or companies and if the company have a good performance, they did not
experience the financial distress. They can use high debt capital. On the other side, the Pecking
order theory that the company with higher financial performance should be less to use the debt
capital.
Based on the role of long term finance theory and evidence that the firms is have a high
finance performance and more profitable if they use the debt capital. While in government there is
negative effect on the economic. Cross-country and researchers conduct an investigation even the
industrial enterprise in the developing countries suffer from a long term debt and that deficiency
affects the investment on their company, the performance and the improvement of the business .
With the use of both studies to the countries the developing countries use less long-term debt. They
assume that more long-term debt capital to be associated with higher performance. Cross-country
study of firm level statistics also indicates specify that if there is an active stock market if the
debtors and creditors will enter to long term contracts, firms to be able grow faster than they
depend only on internal resources and short-term credit. Another important finding: Government
subsidies around the world have increased firms long term debt of the firms, but there is no
4
evidence connecting subsidies with the firm’s ability to grow faster. In some cases, subsidies were
associated with lower productivity.
Conceptual framework
The effect of the long-term debt, cash and accounts payable in working capital in
the business. It is common that the new business or not they preferred to have debt to increase
their capital for the future used and maybe for the expenses their need or etc. There are kinds of
long-term debt first is the Bond these instruments maturity over 12 months and this is tradable.
Second is the bank debt this is the loan came from the financial institutions. Third is the mortgage
these instruments need a collateral so the borrower can borrow. The long term debt is beneficial
but there is a disadvantage of using a long term debt capital like the company need to pay the tax
even their company earn or not. They need to pay the tax to avoid bankruptcy. (Storkey, 2003)
Since early 1990s awareness has been increasing of the need to integrate the management
of all government financial asset and liabilities. Cash and Debt management appear at first glance
to be quite distinct in their objectives and functions and, indeed they developed separately over
time in many countries. Cash management has a relatively short term outlook whereas debt
management has a medium to long term horizon. Cash management key objective is having the
right amount of money in the right place at the right time to meet government obligation in the
most effective way. (Varouj A. Aivazian, Ying Ge &Jiaping Qiu, 2008)
The maturity structure of a firm's debt has a significant impact on its investment decisions.
After controlling for the effect of the overall level of leverage, that a higher percentage of long‐
5
term debt in total debt significantly reduces investment for firms with high growth opportunities.
In contrast, the correlation between debt maturity and investment is not significant for firms with
low growth opportunities. The results are strong at the firm level and at the business segment level.
Figure 1.
Input, Process, Output
INPUT PROCESS OUTPUT
DEMOGRAPHIC ANALYSIS OF Help the respondents

PROFILE DATA about managing and
a. Area of THROUGH: decision making of the
specialization A. Survey outflow and inflow of the
b. Position in the questionnai money related to long
company res term debt and cash
c. Cash and accounts B. Interview management
payable
implemented in the To encourage
company respondents to think it
carefully before taking a
The effects of long term risk for having a long
debt on cash management term debt by including
the disadvantage and
The significance
advantage of it
difference on the long
term debt between cash
management
The researchers used IPO (Input, Process, Output) style wherein the input column this are stated
in the statement of the problem that needs to be answered, while in process column shows the
procedures of how the researchers will gathered the data, and for the output column illustrated the
outcome of the study
6
Hypotheses
The researchers formulated their hypothesis at 0.05 level of significance.
Ho: There is no significant difference on the effect of long-term debt to the cash management in
Ford Motors, Alabang as perceived by the respondents.
Scope and limitations
This study covers the long-term debt and cash management of the business last year
and the current of Ford Motors Alabang. The researchers’ respondents are from the finance
department and they choose to study since the pandemic have a huge impact to the business. The
focus of the study is about the long-term debt and the cash flow of Ford Motors Alabang and the
current situation of the flow of the money and its debt. The researchers want to study the impact
of the pandemic last year and the new normal in the current year.
The researchers asked the estimated budget not the exact amount because of
confidentiality. And they cannot go directly to the location. They choose a respondent working
there but who live in another place.
Significance of the Study
Most banks provide term loans, a major source of long-term debt for large businesses, for
three- to five-years terms. Loans guaranteed by the large Business Administration can provide
7
terms up to 5 years. When a company uses these funds to make capital improvements, acquire
equipment or purchase supplies, it does not use operational cash flow. When a company uses long-
term debt to fund non-balance sheet assets including personnel, it essentially leverages its earnings
to grow the company.
The importance of long term debt in accounts payable is that when they borrow or lend a
long term debt to the bank they can still budget the money. They have to pay on the said debt and
do not have to think about how much to earn because even themselves know how much they pay
each year and also know how much interest they owe the bank through the amortization table
Accountancy Students: It can contribute to their knowledge and this is beneficial since it
is related to accounting.
Finance Department: It can help them to decision making and minimize the debt of the
business
Investor-it can help them to understand why the business needs to borrow money.
Researchers: It can help them to make this as a source can used for related of related
literature and to be their guide for their future research studies.
Definition of Terms
This part will show the related terms to the researchers’ studies and to help the readers to
understand it easily.
 Accounts payable - refers to funds owed to other businesses or creditors that must be
paid within a year of the balance sheet date.
8
 Cash management- is the process of collecting and managing cash flows.
 Long term debt- debt that matures in more than one year, under liabilities.
CHAPTER 2
REVIEW OF RELATED LITERATURES AND STUDIES
Foreign Literature
A cash flow statement is an important indicator of financial health because it is possible
for a company to show profits while not having enough cash to sustain operations. It is a financial
report that shows to the user the source of a company’s cash and how it was spent over a specific
period of time. A cash flow statement counters the ambiguity regarding a company’s solvency that
various accrual accounting measures create. It also categorizes the sources and uses of cash to
provide the reader with an understanding of the amount of cash a company generates and uses in
its operations, as opposed to the amount of cash provided by sources outside the company, such
as borrowed funds or funds from stockholders. The cash flow statement also tells the reader how
much money was spent for items that do not appear on the income statement, such as loan
repayments, long-term asset purchases, and payment of cash dividends (Ryan 2007).
9
The purpose of this study is to review academic literature on prediction of the firm's future
cash flow, they begin by presenting the main findings regarding the important role played by
earnings, cash flow from operations and accruals in predicting future cash flows followed by the
methodology used. Findings from this literature show that the results are inconsistent assertions.
Instead, most of the studies report that cash flow from operations is a better predictor of future
cash flows, whereas some researchers support the assertion. However, other researchers have
shown that the ability of earnings improved when it is disaggregated into its major accruals’
components. This inconsistency in the results was due to the following reasons; methodological
differences; measurement error in the predictor variables and the period covered by the study.
Overall the paper provides additional insight to readers who wish to familiarize with this line of
research and provides possible areas for further research. Cash flow from operations, Earnings,
Accruals, Prediction, Capital market based accounting research the concept of cash flow prediction
is not only interesting and important for the company’s business, investors, creditors, financial
analysts among others but also for academic researchers. Through prediction of cash flow financial
statements users are able to assess firm’s liquidity, financial flexibility and risks. One portion of
that interest focused on the Financial Accounting Standards Board assertion they say that
information about earnings based on accrual accounting is powerful in predicting future operating
cash flows than cash flows itself, the assertion was questioned directly and indirectly by various
researchers. (Mwila Mulenga1 & Meena Bhatia2, 2017)
The literature on future cash flow prediction is vast and focused on three main streams of
research. The first stream of study concentrated on the usefulness of accrual earnings and operating
cash flows in predicting stock prices or stocks return. Concentrated on the usefulness of cash flows
10
information and accrual accounting for predicting business failures. This study makes a specific
contribution and the objective is not only to provide a brief academic literature but also to
synthesize and conceptualize the publications that directly questioned FASB’s assertion. The
emphasis is made in the publications critically examine the role of cash flow from operations,
earnings and its components in predicting a firm's future cash flows. The majority of articles
discussed here are published and selected through online library databases such as EBSCO,
ProQuest, and Google Scholar. Due to the limited number of published articles from different
sources we also comment on the important results from other journals, no references are made to
unpublished working papers. (Dr-Omar Alhawatmeh, University of Jordan, 2017)
Cash levels in firms are a real option instrument similar to financial options of American
type. They can serve as hedging against risk instruments. Inside debt is a source of financial risk.
The debt is higher, the risk is higher. They expect that inside debt levels should be correspondence
with cash levels. In case of firms without full operating cycle, level of operational risk is
smaller than in forms with full operating cycle and levels of cash plays much more the
role of the buffer that hedge against the operational risk. To present and illustrate the ideas
of the paper small and medium wood industry enterprises with full operating cycle data is used.
The model describing debt levels in relation to cash management in small or medium
enterprises is useful to understand the relationships that occur in the course of making decisions
related to the management of operational risk arising from the implementation of the operating
cycle of the small enterprise. (JAMES CHEN, Nov 27, 2020)
It is stated above that the topic related to the researchers study is all about the relationship
between cash levels and debt in small and medium industry enterprises. Let's explain the next
11
literature related to the research it all about debt and cash management of the government. Debt
management is important because the income comes from the tax if there is a liability that can
affect not the economy and also the citizen. The debt manager not only ensures the government
can borrow if they need it but also manages the debt of the country if they are exposed to the risk
particularly to the economy. Sovereign debt management is defined as the process of achieving a
strategy for their funds, their risk, and objective and meeting another sovereign debt management
the government will develop and maintain a productive market for government securities. To avoid
economic shock there is a trade-off between the leaders of the countries. (John Ackah and Sylvester
Vuvor, June,2011)
Foreign Studies
Based on the investigation relationship between cash flow and debt for South African
firms, the researcher finds the cash flow is significant and not related to the long-term debt and
total debt ratios. The result also shows that if the organization has a higher cash flow and also has
less debt in its capital structure. The first simplification of these experimental findings is that the
South Africa prefers internal finance to external finance when they need a fund for an investment
project. Because, there are high information asymmetry costs which means there is an imbalance
in a transaction between the two parties in external finance compared to internal finance. Internal
finance is preferred to equity because it is terrible news for the investor if the company has an
expensive book value and it can affect the stocks if the investor will back out. It is indicated in the
theory of pecking order theory that the capital market is profitable in semi-strong. It is called semi-
12
strong because if the company stocks get worse they can cope up after that. Despite the
development of the South African capital market, there is a need for the development of their
capital market to minimize the information failure problem between the firms and firm financiers
so they can provide easier access to debt and equity financing. The importance of the lagged
dependent variables in the two models reveals the importance of the dynamic models to perform
structure research especially in the context of South Africa.(B.T.Matemilola)
The researchers contribute to empirical research with the used of qualitative or quantitative
it can also be based on the experience or other people experience and it will used on capital
structure in two ways. Unlike the other studies about the relationship between profit and debt, the
researchers investigate the relationship between cash flow and debt in South Africa. And it stated
that the cash flow is the better measurement of internal finance than the profit because it excludes
non-cash items. The researchers uses a better estimation technique, the panels generalize the
method of Generalized Method of Moments (GMM) it effectively controls the unobservable to the
organization the detailed effects and possibility of reverse relationship between the cash flow and
debt, the potential endogeneity of the explanatory variables. They also added GMM allows them
to change the model in debt which is pecking order theory and emphasize it because it used
differencing techniques. The researchers use cash flow as their main independent variable because
it is a better measure for internal finance than the accounting profit. Future research may evaluate
there a relationship between economic profits are the difference between the revenue that the firm
earned and opportunity costs and it reveals vital information about the cash liquidity position of
firms if the state of situation is good or not.(Alexander Andersson, Joel Minnema)
13
When the companies facing a financial deficiency and when they start increasing the
amount of needs in the social development process were not met by the company’s ordinary public
revenues (such as taxes, duties, fees, parafiscal revenues, property and enterprise revenues, taxes,
and penalties). In addition to these expenditures, the state had to resort to borrowing due to major
infrastructure investments, development financing, natural disasters, economic crisis, and budget
deficits. This process has brought different debt types according to maturities (short, medium, long
term), resources (internal and external debts), and voluntariness (voluntary and compulsory debts).
Thus, borrowing overreached to be an extraordinary public revenue and has started to be perceived
as a means of intervention to the economy. (John H. Cochrane, 19 September 2008)
In this section, having a long term debt or a short term debt also affects the political,
economic, and social impacts and current reflections of borrowing in the context of public debt
theory, the transformation in the external debt structure in the globalization process is emphasized.
Initially external assistance and debts taken by developing countries as development financing
have been used as a means to eliminate the stagnation by the developed countries in their
economies. The given debts to the developing countries were used to increase the exports of
developed countries, especially through tied loans. This situation has brought the new market,
technology transfer, and economic power to the developed countries, while it has caused
consumption society, external dependency, debt-interest spiral, and ultimately external debt crises
in the developing countries. (Gardner, J., & Olden, B. (2013).
Based on the American researchers with the title of Group versus individual liability: Short
and long term evidence from Philippine microcredit lending groups their studies say that the choice
of group or individual liability is one of the reasons that the lender makes the design loan products
14
in the market for those people who have not money and also for the start-up business or the gain
of their expenditures. Empirical research on group and individual liability has not provided the
evidence needed to determine the relative merits of the two methodologies. They used two
randomized control trials so they can evaluate the impact of group liability on the performance of
clients and profitability of institutions. This is from the lender in a few regions of the Philippines.
Using empirical research many questions asked for the findings if there is no difference in other
countries, cultures and with the other lenders and to know if a group or individual liability performs
better. If the bank decided to switch from group to individual liability is not separated it is still the
same. They still asked whether the society and microeconomic situations, for the illustration during
their three-year period of study, they oversaw that individual and group borrowers have a
comparable outcome and they are different under the outer conditions in compensation would
occur. The physical science used needs theory-led replication and exertion to resolve the
issue.(Jaramillo, F., & Schiantarelli, F.)
With that limitation in their mind, they have three outstanding results. First, for the
pre-existing group, they find the individual liability to the group that there is no difference to the
reimbursement both in the long run and short run. The changes of individual liability direct to the
big lending group, therefore distant outreach. The total of the average loan is small but there are
no changes in total disbursement and profits. Second, they found in new locations that the bank
officers are not willing to open the group even if there is no improvement in default. Therefore the
supply-constrained the growth of the lending program. The employee's favorable cause or
unwarranted suspicion is outside the scope of date inspection. Third, they find statistical
significance in some of the instruments talked about in the group liability literature such as
15
screening and monitoring. But they simply do not find that it adds up in an economically
meaningful way to higher default in the context and timing studied. (Legesse, T. S., & Guo, H.
(2020).
Synthesis
The overall theories in the studies of the researchers chapter 2 is all about the cash flow
and debt. Cash flow is very important to know the situation of the company for the current
period and it also balances the inflow and outflow of the company it also determine how much
the company spent did not appear in the income statement because the cash flow measure the
non cash items . And it is also good because it can predict the future cash flow and also its
business failure. While in debt if the company decided to have a debt the more they have the debt
the risk higher too and debt is also used to increased the export of the countries used for the who
want to have a business and also for gaining the expenditures of the company . While the
relationship of the cash flow to the debt is If the cash flow is higher there is a less on the
company debt
16
CHAPTER 3
METHODOLOGY
This chapter discuss what will be used to gather the researcher’s data including the
procedures for it and explains the research design. The methodologies of this chapter will include
the research design, area of the study, number of respondents and method will be used to gather
the data.
Research Design
The research design that the researchers will use is descriptive it describes the
society and it also the facts and answers the questions of what, where, when, and how except the
why questions it is used to investigate one or more variables and only measures and observe them.
The research design is defined as quantitative research but it also can be used in qualitative
research. The research design need to sure the reliability of their information there are two things
need to use for gathering the data or information first is the observation on the community but it's
not allowed so the second one the researchers choice conducting a survey form that will distribute
to the respondents and they will also conducting a interview too.
17
Procedure 1
The population of this study are person in the accounting department working at Ford
Motors, Alabang. It also specializes in finance. There occur fifteen (15) persons in the accounting
department population that the researchers covered in the study. The population gathered will be
the respondents of this study.
The information of the population gathered by the researchers is from the eldest sister of
one of the researchers who is currently working at Ford Motors, Alabang as an accountant, for ten
(10) years. Using slovin’s formula is not necessary because the number of the population.
The researchers did not used slovin’s formula to determine the number of respondents. The reason
is that using Slovin’s formula for sample size would be fourteen (14) respondents; however, the
total population of this study is fifth teen (15). The researchers decided to take all the number
population rather than using slovin’s formula. Removing one (1) respondents from the population
is like removing a possible respondent that will share his/her opinion regarding to the topic. Having
an odd number of respondents is most likely unbiased.
Procedure 2
The researchers will be used voluntary sampling method. Voluntary sampling
method is mainly based on ease access. Voluntary response is least biased because of different
perspective about the study. The respondents will volunteer themselves to questions due to the
confidentiality of the information that the researchers ask, some of the respondents may not be
able to answer the question regarding to the topic. The researchers will send out the survey
18
questionnaire to all accountants at Ford Motor, Alabang.
Procedure 3
The researchers used different hypothesis testing methods to come up
with appropriate findings to reconcile with the hypotheses established in chapter one of this study.
Relative Frequency is used to get the percentage from a particular data. The researchers
used this tool in the demographic portion of the survey questionnaire.
Where:
R f = Relative Frequency of the data concerned;
f = Frequency of the data concerned;
n = total number of data
Weighted Mean is used to get the valuable information from each respondent in relation to
the Likert-scale questionnaire administered by the researcher. The result obtained from using this
formula helped the researchers obtained the necessary interpretations on the valuable inputs
needed to address the established problems. The formula is shown below (Blay, 2007):
Where:
= Weighted Mean of the data concerned;
x n = represents the data considered;
w n = represents the weight of the data considered. In relation, Likert
scale’s assigned numerical value was used as the weights.
19
Pearson Product-Moment Correlation (Pearson r). After conducting the survey, all raw data
shall be collected to be observed and analyzed. After analyzing all the data, it will transform into
a numerical data by statistically measuring it with the Pearson correlation coefficient or Pearson's
r. This approach will be employed to treat the numerical research data to show the relationship of
the two variables (product pricing and financial stability). The formula is as follows:
𝑟= 𝑛∑𝑋𝑌 − ∑𝑋∑𝑌
√[𝑛(∑𝑋2) − (∑𝑋)2][𝑛(∑𝑌2) − (∑𝑌)2]
Where:
r = value of Pearson r;
X = data regarding factors affecting the product pricing being the independent variable;
Y = data regarding the factors affecting the financial stability;
n = number of respondents
Interpretation:
1. The result would show the degree of correlation between the variables established in the
study.
2. The interpretation of the degree of correlation is stated in the table below (Blay, 2007):
Correlation Guide: (positive or negative)
Between 0.80 0.99 High Correlation
Between 0.60 0.79 Moderately High Correlation
20
Between 0.40 0.59 Moderate Correlation
Between 0.20 0.39 Low Correlation
Between 0.01 0.19 Negligible Correlation
3. The coefficient of determination is obtained by getting the squared value of the Pearson
r or coefficient of correlation. The coefficient of determination established the percentage
of contribution of independent variable to the dependent variable.
4. To test the significant difference, the researchers used the t-test for correlation coefficient
with the formula:

𝑟
t=
√ 1−𝑟
2𝑛−2
Where:
t = t-test for correlation coefficient
r = Pearson r
n = number of data
Degree of Freedom = n – 2 for the purpose of computing the critical value at 0.05
level of significance. (Blay, 2007)
There is significant difference when the amount obtained is greater than its critical value based on
the table for t-test for correlation coefficient at 0.05 level of significance otherwise, when the result
is opposite there is no significant difference.
5. Moreover, when considering the p-value, when the value is less than 0.05 then the there
is significant difference, when the value is at least 0.05 then there is no significant
difference.
21
Data Gathering and Analysis
To gather data the researcher’s, conduct a survey questionnaire since the researchers and
the respondents are not allowed to go outside. The primary sources that the researchers used is to
conduct a survey questionnaire using a google form and the interview will be included. To support
the study, the researchers gathered some information that are related to the topic by searching from
the internet, journals, books, articles, and research studies that will help the researchers to further
understand the subject matter.
CHAPTER 4
RESULTS AND DISCUSSION
22
This section summarizes the data that was collected and the statistical analyses that were
performed. The goal of this section is to report the results without any type of subjective
interpretation.
DEMOGRAPHIC PROFILE
Table 1
What are the area specialization?
Area of specialization PERCENTAGE
Tax Accounting 20%
Financial Accounting 20%
Management Accounting 20%

Table 2
Commercial Finance 7%
What is the
Corporate Finance 13%
Internal Audit 0%
Others (Manufacturing and 13%

Messengers)
position in the company?
POSITION PERCENTAGE
Accounting Manager 7%
Accounting Officer 7%
Business Analyst 7%
General Accountant 13%
Accounting Supervisor 7%
23
Project Accountant 0%
Staff Accountant 33%
Cost Accountant 7%
Others (Technical Staff and Messenger) 20%
CASH MANAGEMENT IMPLEMENTED BY COMPANY
Managing the cash that the company has is critical since they must appropriately allocate
the money, whether it is for spending or debt, among other things. To avoid insolvency, the
corporation must make a sensible asset budgeting decision. As a result, this section will
demonstrate how the organization implements cash management by transforming the question
into a figure that the readers can easily grasp.
FIGURE 2
24
Prefer short term financing like a line of credit that can be used for emergency purchases or to
combine the gap between payable and receivable
STRONGLY AGREE
47% AGREE
53% STRONGLY DISAGREE

DISAGREE
Fifty-three percent (53%) of respondents agreed that they had short-term debt, while forty-seven
percent (47%) disagreed. Short-term debt, which can be utilized for unforeseen bills and other
company obligations, is preferred by respondents above long-term debt.
FIGURE 3
The company is not only focused on profit but also on its cash flow.
25
STRONGLY AGREE
40%
AGREE
STRONGLY DISAGREE
60%
DISAGREE
It is critical to concentrate not just on the company's profit or income, but also on the cash flow.
Sixty percent (60%) said they agree, and forty percent (40%) said they strongly agree. They are
not solely concerned with the company's profit; they are also concerned with the company's other
concerns.
FIGURE 4
The company focus on better utilization of funds and avoid insolvency.
26
STRONGLY AGREE
33% AGREE
STRONGLY DISAGREE
DISAGREE
67%
Because effective allocation of funds is one of the keys to avoiding company insolvency, it is
critical to have a good allocation of funds to supplement the firm's expenses and commitments. 67
percent said they agreed, while 33 percent said they strongly agreed.
FIGURE 5
27
The company encounters unexpected circumstances like a breakdown of the inventory as a result
of unexpected expenses
STRONGLY AGREE
47% AGREE

DISAGREE
It is difficult to avoid unexpected expenses, so this is one of the effects of the company's decision
to have a long term debt. Fifty-three percent (53 percent) agree that they encountered unexpected
expenses, while forty-seven percent (47 percent) strongly agree that this circumstance affects the
company's operation expenses.
FIGURE 6
28
Creating a proper balance in cash on hand and investment.
7% 6%
STRONGLY AGREE
AGREE
STRONGLY DISAGREE
DISAGREE
87%
The importance of balancing the company's funds and expenses is critical because it might effect
cash flow. Respondents agree with 87 percent in this question, with 7 percent strongly disagreeing
and 6 percent strongly agreeing.
FIGURE 7
29
The organization should plan its cash outflow in such manner that it can earn an extended credit
period from the creditors.
40% STRONGLY AGREE

AGREE
DISAGREE
40% of respondents agree, and 60% strongly agree, that planning cash outflow is critical in keeping
cash inflow in balance, as it can damage the company's ability to pay its creditors..
30
FIGURE 8
Prohibiting the cash outflow and stimulating the cash inflow is a necessary procedure of the
business.
13%
20%
STRONGLY AGREE
AGREE
STRONGLY DISAGREE
DISAGREE
67%
The business procedure is to prevent and stimulate outflows and inflows; 67 percent agree with
this statement, 20 percent strongly agree, and 13 percent disagree.
31
EFECTS OF LONG TERM DEBT ON CASH MANAGEMENT
Many firms do not want to take on significant debt, whether it is short-term or long-term.
However, in the business world, whether the company is new or not, they like to have a debt. The
responses of the respective respondents are presented in this section if long-term debt has an impact
on the company's cash management.
Figure 9
Long term debt makes profitability difficult to achieve.
7%
13%
7%
STRONGLY AGREE
AGREE
STRONGLY DISAGREE
DISAGREE
73%
Long-term debt has an interest rate and must be paid back within the specified time frame. Payment
of interest debt affects the company's revenue. Thirteen percent of respondents (13%) strongly
agree that long-term debt has an impact on earnings. Seventy-three percent (73%) said "agree,"
while seven percent (7%) said "strongly disagree" and "disagree.
32
FIGURE 10
By repaying the loan over a lengthy period, the monthly cash flow is less affected than it would
be on a short term debt with larger payments.
STRONGLY AGREE
47% AGREE

DISAGREE
53 percent agree that repaying a loan over a long period of time has the least impact on cash flow,
while 47 percent strongly agree that long-term debt has the greatest impact on cash flow..
33
FIGURE 11
Long term debt is usually tied to large up- front payouts used for major purchase and
acquisitions.
6%
27%
STRONGLY AGREE
AGREE
STRONGLY DISAGREE
DISAGREE
67%
The percentages for agree, strongly agree, and disagree are 67 percent, 27 percent, and 6 percent,
respectively. The majority of respondents agree that long-term debt is used for debt repayment and
asset acquisition. The 6% of respondents disagree that long-term debt is used for payments and
acquisitions
34
FIGURE 12
High debt leverage stifles the ability of the organization to engage activities such as
product/services development, marketing and promotion to attract more customers
13%
34% STRONGLY AGREE

AGREE
STRONGLY DISAGREE
DISAGREE
53%
Respondents strongly agree and agree that excessive debt leverage stifles company operations,
with 34 percent and 53 percent agreeing, respectively, while 13 percent disagree that high debt
leverage does not stifle business activities.
35
FIGURE 13
Unexpected expenses such as overtime pay, medical subsidies, donation cause by Covid19 lessen
the budget for the long term debt.
7%
13%
STRONGLY AGREE
AGREE
STRONGLY DISAGREE
DISAGREE
80%
Covid-19 has an impact on the business because of the unforeseen expenses covered by the firm,
with 80% of respondents agreeing, 13% strongly agreeing, and 7% disagreeing – such as overtime
compensation, medical subsidies, and contributions have no impact on the budget for long-term
debt.
36
FIGURE 14
Borrowing large amount of money is required a collateral, failure to pay at the timely manner,
there is a risk of losing a property makes the company become unstable.
STRONGLY AGREE
47% AGREE

DISAGREE
Although 53 percent agree that having a long-term debt necessitates collateral of assets for the
creditor's security and that there is a substantial danger for the debtor to lose such assets due to
failure to pay, 47 percent disagree that a debtor will lose an asset due to failing to pay on time.
37
FIGURE 15
Long term debt helps the finance department to supplement the budget for the current period/
next period.
27%
STRONGLY AGREE
AGREE
STRONGLY DISAGREE
DISAGREE
73%
Long-term debt has the benefit of supplementing the needs of the company's finance department.
27 percent of respondents strongly agree that long-term debt aids them in budgeting for the present
and future periods, while 73 percent agree that long-term debt aids them in a variety of ways..
38
TABLE 3
Correlation Analysis
VAR00001 VAR00002
CASH MANAGEMENT Pearson Correlation 1 .296
(VAR00001) Sig. (2-tailed) .285
N 15 15
EFFECTS OF LONG TERM Pearson Correlation .296 1
DEBT ON CASH MANGEMENT Sig. (2-tailed) .285
(VAR00002) N 15 15
Cash management has a low favorable link with the consequences of long-term debt on cash
management, according to the analysis, with a correlation coefficient of r =.296. In this
investigation, the level of significance was set at 5%, or 0.05. Because the value of p is bigger than
the level of significance (0.285 0.05), the study's association is not statistically significant.
39
CHAPTER 5
Conclusions and Recommendations
Conclusions
The practice of collecting and managing cash flows is known as cash management. It is
critical for both individuals and businesses. It is an important factor of a company's financial
stability in business. According to the information acquired, they choose short-term financing for
emergency purchases or mixing the payable and receivable gaps when collecting payments. Profit
is not only a consideration, but it also has an impact on cash flows. In addition, the proper
allocation of funds to supplement the firm's expenses and commitments keeps it from going
bankrupt. Because of the additional costs, cash inflows and outflows fluctuate. Keeping a positive
cash flow and making investments for the future benefit in the company.
Profit is very important to a business since it may help them build their capital and cover
their expenses that they utilized for their inventory, but it is also necessary to monitor cash flows
or the movement of cash in and out of the firm because it can alter the organization's wealth
position. Long-term debt is used to fund corporate expansion and the acquisition of assets that can
be employed in day-to-day operations. Because the cash was not included in the firm's budget and
was released owing to the pandemic, which the company had not anticipated, the corporation can
reclaim it for unanticipated expenses. The decision to borrow must be weighed against the
company's future. The study's significance is in learning about the consequences of long-term debt
in cash management on cash inflows and outflows in their company. It assists the finance
department in supplementing the budget for unforeseen expenses and the effect of long-term debt
40
in cash management, as well as controlling cash outflows, using data about the effect of long-term
debt on cash management.
Long-term debt has a favorable impact on cash management because it supplements the
company's financial needs. Cash management has no direct impact on the company's long-term
debt. Even if a firm is profitable because it earns more revenue than it expenditures on expenses,
it must manage its cash flow effective and efficient to be successful. Cash flow is associated to a
company's operations or business activities, as well as its investment (such as the purchase or sale
of capital equipment) and financing activities (such as raising debt or equity funding or repaying
such funding). The cash generated by a company's operations is linked to its core business
activities and gives the strongest cash flow management opportunities.
Recommendations
Based on the study's findings and conclusions, the following recommendations were made:
1. Effect of long-term debt in company’s liquidity during unexpected business interruptions
like pandemic
2. Further study about the factors affecting in fluctuating of cash flows and action taken
because of the unexpected expenses of the company
3. Responsibilities of finance department in managing the cash of the company
4. Strategies on how to manage long term debt on cash management
5. Budget analysis using long term debt
6. Effective and effecient way on cash management.
41
7. Analysis when to consider in borrowing funds to the creditor.
8. Due to limited sample population used in this study, findings cannot be consired applicable
to larger population, so the researchers recommend that larger sample size may be used in
future studies with the same nature.
9. Further studies like this should be conducted but incorporating different scopes, venues,
and samples to used.
42
References
Adams-Mott, A. (n.d.). The Differences Between Accounts Payable & Long-Term Debt.
Babil, D. (2012, June). Cash Management.
Carpio, G., & Demirguc-Kunt, A. (2013, June 21). The Role of Long-Term Finance: Theory and
Evidence.
Cochrane, J. H. (2008). Long‐Term Debt and Optimal Policy in the Fiscal Theory of the Price
Level. Journal of the Econometric Society .
Gardner, J., & Olden, B. (2013). Public Financial Management and Its Emerging Architecture.
Hubig, A. (2013). Introduction of a New Conceptual Framework for Government Debt
Management. Gabler Verlag.
Jaramillo, F., & Schiantarelli, F. (1997). Access to long term debt and effects of firm's performance
: lessons from Ecudaor. 1.
Legesse, T. S., & Guo, H. (2020). Does firm efficiency matter for debt financing decisions?
Evidence from the biggest manufacturing countries. Journal of Applied Economics .
CLARK, J. (2018, APRIL 26). How to Perform an Independent Sample t-Test.

Graziano, & Raulin. (2020). Research Method (9th Edition). Independent Samples t-Test .
https://magoosh.com/statistics/how-to-perform-an-independent-sample-t-
test/?fbclid=IwAR3VL39aeVtaHxTuAESzmCNrQeVua4uwtweumNuGwsG5WUBQJqwOQktp
gU8
https://graziano-raulin.com/tutorials/stat_comp/mansimpt.htm
https://www.researchgate.net/publication/263848042_Debt_and_Cash_flow_Relationship_in_P
OT_of_Corporate_Financing_Dynamic_Panel_Evidence
43
http://www.sciedu.ca/journal/index.php/afr/article/download/11074/7014
https://link.springer.com/chapter/10.1057/9781137315304_32?fbclid=IwAR2Nlo954_eqK2u8i1
1Za4w5ffwk_KgYw7OiDIG1BTQaKr4RdkqEA1pOtqU#cities
https://reader.elsevier.com/reader/sd/pii/S2212567115016561?token=263B1BAF4B35BFB81F5
1E176851432D9DC46191A84C4CCBA4D58BA17D32C06C56647A5FAA2B45BD0E60E237
53976BF49&originRegion=eu-west-1&originCreation=20210416115728
https://ukdiss.com/litreview/literature-review-on-cash-flow-statements.php
44
APPENDIX A
SURVEY QUESTIONNAIRE
DEMOGRAPHIC PROFILE
AREA OF SPECIALIZATION
What is your area of specialization?
Tax accounting
= Tax accountants prepare yearly tax returns for various entities or individuals.
Financial accounting
= Financial accounting refers to the analysis and preparation of your company’s
financial statements that are used to determine your company’s financial health
and performance over a given period.
Management accounting
= Management accounting measures your company’s financial information to the
management team. Though it bears a resemblance to financial accounting,
management accounting allows those within the company to make informed
decisions to help improve their financial situation.
Commercial finance
= It is at the heart of industry and commerce and has a strong focus on consumer
transactions. Sectors such as retail, manufacturing, fast-moving consumer goods
and leisure employ commercial finance managers to analyse the performance of
their products or services and make recommendations to maximize profits.
Corporate finance
= It primarily involves adding value to businesses through buying and selling.
Roles range from lead advisers, who project manage the process of raising
capital, through to reporting accountants and auditors, who are responsible for
making sure that the accounts of any target company are in good order, to
lawyers, who ensure that any transactions are carried out in the correct legally
binding way.
45
Internal audit
= Internal auditing teams look closely at key areas of the business and report their
findings to management; the information that they gather is used by senior
management. Internal auditors can advise management if important areas of the
business are being run in an inefficient, financially risky or even fraudulent way.
POSITION
What is your position in the company?
1. Accounting Manager
2. Accounting Officer
3. Business Analyst
4. General Accountant
5. Accounting Supervisor
6. Project Accountant
7. Staff Accountant
8. Cost Accountant
46
CASH MANAGEMENT
STONGLY AGREE STRONG DISAGREE

AGREE DISAGREE
Prefer short term financing

like a line of credit that can
be used for emergency
purchases or to combine the
gap between payable and
receivable
The company is not only
focused on profit but also on
its cash flow.
The company focus on
better utilization of funds
and avoid insolvency.
The company encounters
unexpected circumstances
like a breakdown of the
inventory as a result of
unexpected expenses.
Creating a proper balance in
cash on hand and
investment.
The organization should
plan its cash outflow in such
manner that it can earn an
extended credit period from
the creditors.
Prohibiting the cash outflow
and stimulating the cash
inflow is a necessary
procedure of the business.
47
EFECTS OF LONG TERM DEBT ON CASH MANAGEMENT
STONGLY AGREE STRONG DISAGREE

AGREE DISAGREE
Long term debt makes profitability

difficult to achieve.
By repaying the loan over a lengthy
period, the monthly cash flow is less
affected than it would be on a short
term debt with larger payments.
Long term debt is usually tied to large
up- front payouts used for major
purchase and acquisitions.
High debt leverage stifles the ability of
the organization to engage activities
such as product/services development,
marketing and promotion to attract
more customers
Unexpected expenses such as overtime
pay, medical subsidies, donation cause
by Covid19 lessen the budget for the
long term debt.
Borrowing large amount of money is
required a collateral, failure to pay at
the timely manner, there is a risk of
losing a property makes the company
become unstable.
Long term debt helps the finance
department to supplement the budget
for the current period/ next period.
48
APPENDIX B
REQUEST LETTER

KM30 Old Highway, 4023 San Pedro Laguna, Philippines
Dear Ma`am/Sir,
Greetings!
We the students of San Pedro College of Business Administration (SPCBA) section of BSA-602
would like to asked your permission to conduct a survey to the finance department of Ford
Motors of Alabang about the EFFECT OF LONG TERM DEBT ON CASH
MANAGEMENT.
We would like appreciate your response, assistance and support in this particular research
Thank you very much to your cooperation.
Respectfully Yours,
Bati-on,Camille L.
Giega, Juda Mae C.
Gonzales, Niño P.
49
CURRICULUM VITAE
CAMILLE L. BATI-ON
Address:Blk 6 Lot 9 Celina Homes Technopark
Brgy. Loma Biñan Laguna
Contact Number: 09519184932
E-mail Address:camillemille349@gmail.com
OBJECTIVE
To enhance my skills and knowledge
EDUCATIONAL BACKGROUND
Tertiary: San Pedro College of Business Administration

KM30 Old National Highway, 4023 San Pedro Laguna
2018- Present
Secondary
Senior High School: University of Perpetual Help System-BiñanCampus
Sto. Niño, City of Biñan, Laguna, 4026 Biñan Philippines
2016-2018
Junior High School: Biñan Secondary School of Applied Academics

Brgy. Sto Tomas Biñan Laguna
2012-2016
Primary Loma Elementary School

Brgy. Loma Biñan City Laguna
2009-2012
50
CERTIFICATES/SEMINARS/TRAINING ATTENDED
Work Immersion
Creotec Inc. Philippines
SKILLS AND QUALIFICATIONS
 Computer Literate
 Flexibility
 Attention to Detail
PERSONAL DATA
Age : 21 years old

Gender : Female
Birth Date : January 25, 2000
Birth Place : Santa Rosa Laguna
Height : 5`0
Weight : 40 kg.
Civil Status : Single
Religion : Roman Catholic
Citizenship : Filipino
Father’s Name : Ronnie F. Bati-on
Occupation : Tricycle Driver
Mother’s Name : Candelaria L. Bati-on
Occupation : Production Operator
I hereby certify that the above information are true and correct to the best of my
knowledge
CAMILLE L. BATI-ON
51
JUDA MAE C. GIEGA

Address: 2172 Caliraya St. Holiday Homes Phase 2,
Barangay San Antonio, San Pedro City, Laguna
Contact Number: 0915-649-4754
E-mail Address: judamaegiega3@gmail.com
OBJECTIVE
To use my skills in the best possible way for achieving the company's goal. To work in a
dynamic environment that enables me and utilizes my knowledge and learn new things and
progress professionally and personally.
WORK EXPERIENCE
Catering Services Zion Event’s Place

Holiday Hills, San Pedro, Laguna
Tertiary: San Pedro College of BusinessAdministration

Bachelor of Science in Accountancy
KM30, Old National Highway, Brgy.Nueva, San Pedro
City,Laguna
2018- Present
Secondary
Senior High School: San Pedro College of Business AdministrationAccounting,
Business and Management (ABM) STRAND
KM30, Old National Highway, Brgy.Nueva, San Pedro City,
Laguna
2016-2018
Junior High School: Adelina 1 National High School Sampaguita Annex

Galatian St., Adelina 1 Complex, Brgy. San Antonio,
San Pedro, Laguna
2012-2016
52
Primary Rancho Elementary School
Brgy. Rancho, Santa, Ilocos Sur
2006-2012
 Good in Communication Skills

 Knowledgeable in Microsoft Office Tools
 Organized
 Good Time Management
 Multi-tasker
 Friendly
 Can work under pressure
PERSONAL DATA
Age : 21 years old

Gender : Female
Birth Date : December 19, 1999
Birth Place : Santa, Ilocos Sur
Height : 5’3
Weight : 60 kg.
Civil Status : Single
Father’s Name : Joseph Giega
Occupation : Laborer
Mother’s Name : Ma. Victoria Giega
Occupation : Dealer of Chicken
knowledge
JUDA MAE C. GIEGA
53
NIÑO P. GONZALES
Address: 195 barangay Ganado Biñan City, Laguna
Contact Number: 09107505940
E-mail Address: ngonzales0117@gmail.com
OBJECTIVE:
To be in a position that are related to my specialization to share and improve my

knowledge.
WORK EXPERIENCE:
Production operator
GLADES INTERNATIONAL CORPORATION(2011-2018)
Tertiary: San Pedro College Of Business Administration

KM30, Old National Highway, Brgy.Nueva,
San Pedro City,Laguna
2018- Present
Junior High School: Pulong Santa Cruz National Highschool

Pulong Santa Cruz Santa Rosa City Laguna
(2006-2010)
PRIMARY: Ganado Elementary School

Brgy. Ganado Biñan City Laguna
54
 Explore accounting bachelor's and master's degrees.

 Computer Literate
 Resourceful
 Good time management
PERSONAL DATA
Age : 29
Gender :Male
Birth Date : January 17 1992
Birth Place : 195 barangay Ganado Biñan City Laguna
Height : 5"7
Weight : 84 kg.
Civil Status : Single with live in partner
Father’s Name : Edgardo M. Gonzales
Occupation : Mason
Mother’s Name :Maria P Gonzales
Occupation :House Wife
knowledge
Niño Gonzales
55
56
57

TH 91

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

TH 91

Uploaded by

Copyright:

Available Formats

SAN PEDRO COLLEGE OF BUSINESS ADMINISTRATION

Km. 30 Old National Highway, Brgy. Nueva, San

EFFECTS OF LONG TERM DEBT

A Research Presented to the

In Partial Fulfilment of the Requirements for the Degree of

BATI – ON, CAMILLE L.

NAME OF THE RESEARCHERS

Approval Sheet iii

List of Figures vii

List of Appendices vii

Background of the Study ` 01

Statement of the Problem 02

Objectives of the Study 03

Hypotheses (if needed) 06

Scope and Limitations 07

Significance of the Study 08

CHAPTER 2 REVIEW OF RELATED LITERATURE AND STUDIES

Research Setting (if necessary) 14

First step procedure 15

Second step procedure 16

Third step procedure… 17

Data Gathering and Statistical Analysis 18

CHAPTER 4 RESULTS AND DISCUSSIONS

First Specific Objective 19

Second Specific Objective 20

Third Specific Objective… 21

CHAPTER 5 CONCLUSIONS AND RECOMMENDATIONS

Table Title Page

1 What are the area specialization 23

2 What is the position in the company 24

Figure Title Page

1 Input, Process, Output 06

2 Prefer short term financing….. 25

3 The company is not only focused on profit…. 26

4 Utilization of funds and avoid insolvency 27

5 Unexpected circumstances result of unexpected expenses 28

6 Proper balance in cash on hand and investment 29

7 Plan its cash outflow in such manner that it can earn 30

8 Prohibiting the cash outflow and stimulating the cash inflow 31

9 Long term debt makes profitability difficult to achieve 32

11 Tied to large up- front payouts for major acquisitions 34

12 High debt leverage stifles the organization to engage activities 35

13 Unexpected expenses lessen the budget for long term debt. 36

14 Borrowing large amount of money is required a collateral. 37

15 Long term debt supplement the budget 38

Appendix Title Page

THE PROBLEM AND ITS SETTING

Background of the Study

and some lead to bankruptcy and business closure.

Statement of the Problem

1. What is demographic profile of the respondents in terms of:

c. What is the cash management implemented of the company?

Ford Motors, Alabang as perceived by the respondents?

Objectives of the Study

long-term debt effects cash management.

To achieve this, the objectives are:

1. To gain a better understanding of how long-term debt affects cash management.

2. Knowing why corporations embrace long-term debt is important.

3. Long-term debt has a significant impact on cash management.

associated with lower productivity.

most effective way. (Varouj A. Aivazian, Ying Ge &Jiaping Qiu, 2008)

Input, Process, Output