TABLE OF CONTENTS
DECLARATION .......................................................................................................................... ii
APPROVAL ......... : ....................................................................................................................... iii
DEDICATION ............................................................................................................................. iv
ACKNOWLEDGEMENTS .......................................................................................................... v
ABSTRACT .................................................................................................................................... x
CHAPTER ONE ............................................................................................................................ 1
1.0 Introduction ................................................................................................................................ I
1.1.0 Background of the Study ........................................................................................................ 1
1.1.1 Historical Perspective ............................................................................................................. I
1.1.2 Theoretical Perspective ........................................................................................................... I
1.1.3 Conceptual Perspective ........................................................................................................... 2
1.1.4 Contextual Perspective ........................................................................................................... 3
1.2 Statement of the Problem ........................................................................................................... 3
1.3.0 Purpose of the Study .............................................................................................................. .4
1.4.0 Objectives of the study .......................................................................................................... .4
1.5.0 Research Questions ................................................................................................................. 4
1.6. Scope of the Study ...................................................................................................................... 5
1. 7. Significance of the Study .......................................................................................................... 5
1. 7 Conceptual frame work .............................................................................................................. 6
CHAPTER TWO ........................................................................................................................... 7
LITERATURE REVIEW ............................................................................................................. 7
2.0 Introduction ................................................................................................................................ 7
2.1 Rel::ttecl Liternture Review ......................................................................................................... 7
2.1.1 Cash flow management Concept ............................................................................................ 7
2.2.0 Effectiveness of the Cash flow management Policies by Banking Firms .............................. 7
2.3.0 Theoretical Approaches to Cash flow management. .............................................................. 8
2.3.1 Monetary theoretic approach to cash flow management. ....................................................... 8
2.3.2 Operations research approach to cash flow management. ...................................................... 8
2.3.3 Financial approach to cash flow management. ....................................................................... 8
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2.4.0 Factors of cash flow management .......................................................................................... 9
2.4.1 Managing Cash flow ............................................................................................................... 9
2.5.0 Motives for holding cash ........................................................................................................ 9
2.5.1 Transaction motive ................................................................................................................. 9
2.5.2 Precautionary motive .............................................................................................................. 9
2.5 .3 Speculative motive ................................................................................................................ I 0
2.6 Theoretical Review .................................................................................................................. 10
2.7.0 Conceptual Review ............................................................................................................... 10
2.7.1 The effects of cash planning and Budgeting on the performance of Banking Firms ........... I 0
2. 7 .2 The effects of Cash collection on performance of Banking Firms ....................................... 11
2.7.3 Analysis ofCa;sh Control on the Performance of Banking Firms ........................................ 12
2.8.0 Performance ofFirm ............................................................................................................. 13
2.8.1 Cash flow management and the performance of a fom ........................................................ 14
2. 9 Key Performance Indicators .................................................................................................... 14
2.9.1 Breaking down 'Key Perfonnance Indicators - KPI' ............................................................. 14
CHAPTER THREE ..................................................................................................................... 15
IYIETHODOLOGY ...................................................................................................................... 15
3.1 Research design ....................................................................................................................... 15
3 .2 Target population ..................................................................................................................... 15
3.2.2 Sample Size .......................................................................................................................... 16
3.3 Sampling Teclmique ................................................................................................................ 16
3 .4 Data collection instruments ..................................................................................................... 16
3 .4.1 Questionnaire ........................................................................................................................ 16
3 .4 .2 Interviews ............................................................................................................................. 16
3.5 Reliability and validity ............................................................................................................ 17
3.6 Data Analysis ........................................................................................................................... 17
Quantitative analysis ...................................................................................................................... 17
Qualitative analysis ........................................................................................................................ 17
3. 7 Ethical Consideration ............................................................................................................... 18
CHAPTER FOUR ....................................................................................................................... 19
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DATA ANALYSIS AND INTERPRETATION OF FINDINGS ............................................. 19
4.1 lntroduction .............................................................................................................................. 19
4.2 Demographic characteristics of respondents ........................................................................... 19
4.3 Cash Management Techniques Used By Bank of Africa ........................................................ 21
4.3.1 Cash management techniques being used in Bank of African ............................................. 21
4.3.2 Rating the effectiveness of cash management in Bank of Africa Uganda ............................ 21
4.3.3 Bank of African invest its excess cash balances in marketable securities ............................ 22
4.3 .4 The bank puts _aside money for precaution and speculation motives ................................... 22
4.3.5 Optimum cash balance .......................................................................................................... 23
4.3.7 Bank of Africa takes long to pay off debts due to it.. ......................................................... 24
4.3.8 Preparation of Cash Budgets ................................................................................................ 25
4.4 Level of Organizational performance in Bank of Africa ......................................................... 27
4.4.1 Rating the level of Organizational performance in the bank of African .............................. 27
4.4.5 The current Organizational performance of post bank limited is low .................................. 27
.4. 7 Determinants of Organizational performance in Bank of African ......................................... 29
4.5 The Relationship between Cash management and Organizational perfom1ance of commercial
banks .............................................................................................................................................. 30
4.5.1 Effect of Cash Management on Organizational performance of Bank of Africa-Uganda . .30
4.5.2 Cash management affects Organizational performance ....................................................... 30
4.5.3 Good cash management practices results in high Organizational performance levels ........ .31
4.5.5 Delaying payables improves Organizational perfonnance ................................................... 32
4.5.6: Accelerating receipts collections increases Organizational performance ........................... 33
CHAPTER FIVE ......................................................................................................................... 35
SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS .................... 35
5.0 Introduction ............................................................................................................................. .35
5.1 Summary of findings .............................................................................................................. .35
5.1.1 Cash management techniques used by Bank of Africa ........................................................ 35
5.1.2 Level of Organizational performance in Bank of Africa ...................................................... 36
5.1.3 Cash management and Organizational performance of Bank of Africa .............................. .36
5.2 Conclusion .............................................................................................................................. .37
5.3 Recommendations ................................................................................................................... .38
ABSTRACT The study aimed at establishing the relationship between cash flow management and the performance of Bank Africa Luzira Branch. The objectives of the study were; to assess the effectiveness of cash flow management policies of Banking Firms of Bank Africa Luzira Branch, to analyze the motives of cash collection and control on performance of Bank Africa Luzira Branch, to find out the relationship between cash flow management and the performance of Bank Africa Luzira Branch. The study used a research design involving both quantitative and qualitative methods. The quantitative approach will be used to quantify incidences in order to describe current conditions and to investigate the relationships between cash management and performances of cooperate firms using information gained from the questionnaires. The qualitative approach was used to explain the events and describe findings using interviews and documentary analysis. All this enabled the researcher to gain in-depth information that was used to find solutions for the research questions of the study. The responses prior to this chapter were in due respect to research questions given to respondents. The findings from the study show that effective cash management as a mechanism of any business to improve the Organizational performance of Bank of African among other activities in the business Regarding the techniques used in cash management, most respondents agreed to the idea that collecting of overdue invoices is sued for cash management. ' Use of accounts data base and tracking expenses were also shown to be the most commonly used techniques of cash management in Bartle of Africa. The study findings are supported by (Myers, 2003) who said that cash management is knowing a company's optimal cash balance and this is what Bank of Africa strives to do by employing the above mentioned techniques of cash management. The study recommends a need for deploying a cash management system which involves support and coordination among multiple departments including Finance, Operations, IT, Security and Loss Prevention to improve Organizational performance in a company
