Controlled disbursement is cash controlling and cash management technique that is employed at the corporate sector of the market. With the help of controlled disbursement the corporate sector regulates and checks the flow of cheaques between the business and the banks. This process is accomplished on daily biases by mandating once daily distributions of the checks between the bank and the business. The purpose of the controlled disbursement is to manage funds or to meet specific investment goals.
The general purpose of the controlled disbursement is to increase or enhance the availability of cash within a system so that it can easily pay off its debt and make principle interest payments or achieve specific investment related goals. The excessive funds of the business are invested in the market to achieve profit for as long as it is possible to keep them invested in the market. With the help of controlled disbursement technique a business or a corporate entity can make maximum use of the cash available at hand and can generate more profit out of this cash. Another technique that is opposite of that of controlled disbursement is called the delayed disbursement that is also known as Federal Reserve Float.
Other Related Accounting Articles: