How does cash management affect the financial stability of small businesses in the Philippines?
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Cash management plays a crucial role in the financial stability of small businesses in the Philippines. Effective cash management procedures are essential for firms to improve their financial management and ensure their sustainability . Microenterprises, which are significant contributors to the country's economic development, face financial challenges that can be addressed through proper cash management . Cash management involves the management of liquidity to meet day-to-day commitments, and poor focus on cash management can result in tied-up financial assets . By implementing sound cash management practices, small businesses can achieve sound financial performance and mitigate the risk of bankruptcy . It is recommended that small businesses collect accounts receivable promptly to ensure liquidity and convert receivables into cash . Overall, effective cash management is crucial for the financial stability and success of small businesses in the Philippines.
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