What is cash flow management?

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Cash flow management involves tracking and optimizing the movement of money in and out of a business to ensure financial stability. It focuses on maintaining sufficient cash to cover daily expenses, payroll, and other obligations while preventing shortfalls. Good cash flow management requires forecasting future cash needs, analyzing receivables and payables, and managing working capital efficiently. By maintaining a positive cash flow, businesses can invest in growth opportunities, reduce debt, and avoid liquidity crises. Proper management also enables smoother operations, timely supplier payments, and improved creditworthiness with financial institutions.