Managing cash flow of food processing enterprises listed on vietnam stock market

-1- INTRODUCTION 1. Imperativeness of the study In fact, many profitable businesses can go bankrupt if cash flow is not managed closely. Therefore, the change in perception from considering only the profit to seeing the money flow management is a necessity for the business financial managers of Vietnam. However, cash flow management is a relatively new issue for enterprise in Vietnam in general and food processing businesses in particular so the embarrassment and arising defects are unavoidable; as a result cash flow management did not meet the required expectations, the inability to meet payment needs of businesses is not small. Especially in the context of the complex changing business environment, competition becomes fiercer, a series of corporate bankrupt, the survival of enterprises will hardly be sustainable if the cash flow management is not enhanced towards tighter, more comprehensive and more effective. Food processing enterprises in Vietnam are businesses trading essential products which closely linked to the agricultural economy of Vietnam. However, the food processing enterprises in Vietnam still operate in terms of habit, there are no scientific computing in business management in general and in operating cash flow management in particular. Especially, the operation of food processing enterprises is characterized by great frequency cash inflows and cash outflows. Therefore, good cash flow management will help food processing businesses survive and will overcome the crisis more easily. From the above fact, the study "Managing cash flow of food processing enterprises in Vietnam" is very essential. 2. Research Objectives Based on the perspective of the researcher and the above analysis, the research goals of the project focused on the following issues: -2- - Clarify the reasoning of business cash flow management and build up the evaluation criteria of cash flow management in accordance with the characteristics of food processing enterprises listed Vietnam. - Analyze and evaluate the real situation of the cash flow management of food processing enterprises in Vietnam. - Propose some solutions to enhance cash flow management of food processing enterprises in Vietnam. 3. Object and scope of the research 3.1. Object of study The subject of the study is cash flow management of the business. In this study, the author has focused on cash flow management for operating cash flow of the business. 3.2. Scope of Research About time: the period of 2007-2012. About space: 53 food processing businesses listed on Vietnam stock market. 4. Contribution of the research (1) The author has proposed a new approach in the cash flow management of businesses. Managing cash flow needs to be understood as a process involving all business operations of the enterprise. (2) The author has developed a system of governance indicators evaluating the cash flow of the business. (3) The author has outlined the factors (subjective and objective) which have impacts on the cash flow management of the business; at the same time, used these factors to assess the situation of weak cash flow management of the food processing listed businesses. (4) The author has carried out deep interviews with questionnaires to chief financial officer, chief accountant, caseworker orders from 8 food processing -3- listed businesses on HSX and HNX, and in-depth interviews with financial and audit experts to provide information in the process of analysis and assessment of cash flow management of these businesses. (5) The author has used quantitative research methods through data collection of secondary finance to construct the study sample with 15 among 53 businesses and use the STATA software for analyzing factors affecting cash flow management in the food processing listed enterprises. (6) The author has proposed building cash flow forecasting model with the food processing listed businesses through analysis, evaluation of 6 cash flow forecasting models which are widely used in the world and association with Vietnam conditions. At the same time, the author has shown the positive impact of cash flow forecast on the cash flow management of food processing listed businesses. (7) The author has studied Stone's application to build optimized budget models for food processing listed businesses, which help cash flow management of these companies achieve better results. 5. Structure of the research In addition to the introduction and conclusion, the thesis is structured into 4 chapters, as follows: Chapter 1: Overview of research and research methods Chapter 2: The basic theoretical issues of cash flow management of businesses. Chapter 3: Real situation of managing cash flow of food processing enterprises listed on the Vietnam stock market. Chapter 4: Solutions to enhance cash flow management of food processing enterprises listed on the Vietnam stock market. -4- CHAPTER 1: OVERVIEW OF THE RESEARCH AND METHODOLOGY 1.1. Research Overview 1.1.1. Studies abroad The author has overviewed the research of authors in the world according to 4 contents: - The role of cash flow management. - The content of cash flow management and fund management. - Factors affecting cash flow management. - Cash flow management model. It can be seen that the basic research in the world has provided different approaches to cash flow management as well as evaluated the impact of cash flow management on businesses. However, no study has evaluated the impact of total factor group to cash flow management of the business. So we need to conduct a study of a general nature, combining elements of management affects the cash flow management of the business. This suggests the study on the following directions: (i) evaluate all factors affecting cash flow management of the business; (ii) quantify the factors that impact on cash flow management and construction of model cash flow management of the business; (iii) appropriate techniques which are used for cash flow management. 1.1.2. Studies in Vietnam Cash flow management has an important role and has become increasingly more important for every business. However, at present, in Vietnam, the research on the reality of cash flow management is very limited, no study has yet approached profoundly and completely. -5- Through comprehensive research assessment, we need to have a comprehensive approach project on cash flow management of the business. 1.2. Research Questions 1. Which contents are included in cash flow management of the business? 2. What factors affect the cash flow management of the food processing businesses listed on the stock market in Vietnam? 3. How does cash flow management influence the operation of enterprises? 4. Do food processing listed businesses use models in the administration of cash flow? Which cash flow management model fits with these businesses? 1.3. Research Methodology 1.3.1. Approach Subjects of the research are approached towards a comprehensive way in terms of the process from the emergence of cash inflows and outflows, cash flow planning, to forecast cash flow and build the optimal budget. 1.3.2. Variables of the research Based on these hypotheses, the research focuses on the following variables: Opportunity costs, transaction costs, the demand for money (based on cash flow forecast). Net revenue, receivables, payables, inventory, cash inflows and outflows. These variables help business to forecast the money needed. Thus helping to determine the optimal level of reserve money. 1.3.3. Information collection methods Primary information collection: deep interview with financial managers, chief accountants, line worker, at the same time consulting experts in the field of financial management and auditors. -6- Secondary information collection: previous financial accounting information and inheritance studies in the country and in the world which related to cash flow management. 1.3.4. The sample research Statistical analysis describes cash flow management situation: 15 out of 53 businesses. Applied research and build models that predict cash flow and cash optimization: the data of 53 companies (Overall). In-depth interviews: 4 food processing businesses listed on HSX and other four ones listed on HNX. 1.3.5. Synthetic methods and data processing The method of analysis and synthesis of information are described in detail, including descriptive statistical analysis method, the method uses econometric modeling quantitative analysis, comparative analysis of the control and scenarios analysis and expert method. Conclusion of Chapter 1 From the synthesis of the research in the country and abroad, the space of the research is determined. This is a pre-condition to guide the direction for the research of the author. Accordingly, research objectives, research subjects and research scopes are defined. The author has developed modeling research questions and hypotheses, thereby choosing research methods (a combination of qualitative research and quantitative research through a survey and in-depth interviews). -1- CHAPTER 2: BASIC THEORETICAL PROBLEMS OF CASH FLOW MANAGEMENT OF BUSINESS 2.1. Overview of cash flow of business 2.1.1. General overview of business Enterprises can be classified according to many different criteria; in the thesis, the author uses the classification criteria in the form of business ownership (including SOEs and private enterprises) and specific criteria for business (according to the general classification criteria of business classification systems in Vietnam and around the world, in which the author focuses on how businesses are classified under the general criteria of ICB). 2.1.2. Cash flow of business When referring to cash flow of a company, there is not a concept of money flow in general, we need to understand the concept of cash flow through cash inflows, outflows and net cash flow. Net cash flow is determined by the total amount in a period minus the amount spent in the corresponding period. Cash flow is recorded under actual incurred amount method, which is different from the target profit of a period calculated according to the accrual method. Cash flow characteristics of the company are based on three activities (production business, finance and investments) 2.2. Cash flow management of business 2.2.1. The concept of cash flow There are many different ways to understand and approach the cash flow; according to the author cash flow management should be understood in a comprehensively process. -2- Cash flow management is a continuous effort to minimize the negative impacts during operations and focus on money management principles, "not too much and not too little money". As slowly as possible As quickly as possible Cash Material Inventory Receivables Purchasing Manufacturing Collection Sales Figure 2.1. Cash flow management process 2.2.2. Content of cash flow management Managing cash flow should be implemented in accordance with the full range of content from arising transactions, recognition and control to the financial transactions in order to optimize funds and the handling of funds of enterprises. So, basically the contents of the cash flow management including determining cash inflows (revenues), determining cash outflows (expenditures), planning for cash flow and determining optimal budgets. Cash inflows and outflows are determined under direct and indirect method. Scheduling cash flow is based on cash flow forecasts (6 methods of forecasting cash flows) Building up optimal funds (studying 3 optimal funding models which are widely used around the world: Baumol, Miller - Orr, and Stone models). -3- 2.2.3. Evaluation criteria of cash flow management Managing cash flow of the business is well assessed when the payment needs of businesses are met in full. The ratio reflects the cash flow, including: (i) Full affordability of cash flows: Ability to pay the full fixed costs of cash flow; Ability to pay total debt; Ability to repay short-term debt; Ability to reinvest. (ii) The ability to generate cash from operations of the business: The ratio of cash flow/revenue; The ratio of cash flow/profit after tax; The ration of cash flow/assets; The ratio of cash flow/equity; The ratio of cash flow/share. 2.3. Factors affecting cash flow management of the business 2.3.1. Subjective factors Cost of debt and funding structure, content selection and cash flow management techniques, the capacity of financial management, commercial credit policies of the enterprises. 2.3.2. Objective factors: business characteristics, interest rates and economic indicators, economic cycles and financial needs of businesses, financial markets and financial institutions. Conclusion of Chapter 2 Through chapter 2, the author has outlined the basic content of cash flow management of the company, from which proposed a more comprehensive understanding of cash flow management of business by the process. Besides, the author also generalize the factors affecting cash flow management of the company. -4- Chapter 3 The real situation of cash flow management of food processing companies listed on Vietnam’s stock market 3.1 Characteristics of the food processing companies that affect cash flow management According to the Industry Classification Benchmark structure for sector analysis, the companies listed on Vietnam’s stock market are allocated to the subsector based on their source of revenue or where they constitutes the majority of revenue. Consequently, up to the date of 31 st May 2013, these food processing companies have been classified to the third level subsector including 53 companies (there are 26 food companies and 27 aquaculture and seafood companies). In Vietnam, under the government’s decree No 56/2009/NĐ-CP dated 30 th June 2009, most of these companies are large scale ones. Their business activities closely associate with essential products and agricultural production in Vietnam. Although the companies’ products serve the essential needs, their operation decreases considerably due to the influence of economic recession. It is clearly seen through the falling ratio of ROA, ROE, and ROCE at a low and significant level. 3.2 The real situation of cash flow management of the food processing companies listed on Vietnam’s stock market According to the survey result of 15 food processing businesses listed on the stock market and in-depth interview with chief financial officer, the cash flows into and out of these businesses are determined by an indirect method. Accordingly, the statement of cash flows reflecting cash flow coming in, cash flow going out and net cash flow of the businesses is incorporated indirectly. Under this method, the net cash flow of the company is based on the after – tax profit margin adjusted for some items which are not the incurring cash on the -5- balance sheet and show some changes in working capital. Therefore, the real situation of managing cash flow in and out mainly bases on the administration of the items which have a significant influence on changing cash flow in, cash flow out and net cash flow. The following data reflect the current status of cash flow management by these food processing companies. 3.2.1. The real situation of managing incoming cash flow According to the result of data collection and analysis on the status of receivables, it can be obviously seen that receivables accounted for a large percentage and tend to increase. As of 31 st December 2012, the percentage was even higher in some enterprises, particularly in the field of aquaculture. For example, the receivable per total assets at Gentraco was 62.07%, and Viet An Seafood 43.22%. Agricultural and seafood processing enterprises had a high inventory proportion of the total assets and increase significantly in 2012. In addition, foreign exchange losses, billing discounts and provision for credit risk also went up. 3.2.2. The real situation of managing outgoing cash flow The cash flow out of a company consists of payments for a company’s business activities in which payables play an important role. They have a vital impact on the outgoing cash flow. The result of analyzing these food processing companies’ data showed that the percentage of payables of the total pay was high and increased rapidly in the period 2007 - 2012. In particular, the number of enterprises with more than 50% was 31; especially Vietnam Thai Hoa Group was 94%. Furthermore, these companies did not use the policy of electronic payments to balance cash flows in and out. -6- 3.2.3 The real situation of planning cash flow and building the optimal budget As the survey and in-depth interviews showed, planning cash flow was not paid attention. The process of planning cash flow has not been fully implemented from preparation, cash flow prediction and determination to establishment of optimal budget. The companies are planning cash flows based on the balance of revenue and incurring expenses, and have no plans for forecast. Moreover, cash flow planning can only be done together with financial planning annually. Because of not paying adequate attention to planning cash flow, these firms do not use any model to forecast cash flow, do not really apply the model of optimizing budgets in cash flow management, and do not overcome the seasonal forecast and cash flow management. 3.3. Evaluating the real situation of cash flow management of the food processing companies listed on Vietnam’s stock maket The result of cash flow management is recognized through some of financial indicators as follows. Table 3.14. Cash flow ratios of listed food processing companies Unit: times Year 2007 2008 2009 2010 2011 2012 No. Ratio 1 Cash flow fixed charge coverage 0.08 0.27 0.17 0.09 0.07 0.71 2 Debt repayment from operating cash flow (2.78) 0.03 (30.51) 6.76 1.22 (12.63) 3 Cash flow current ratio (8.22) (2.34) (50.27) 15.00 2.48 (16.34) 4 Devidend payment from operating cash flow 0.10 2.52 0.00 2.14 0.02 (0.93) 5 Cash flow from continuing operations to sales 0.00 (0.01) 0.06 0.01 0.02 0.04 6 Cash to income ration 1.11 (1.53) (7.02) (1.65) (0.33) 6.05 7 Cash return on assets 0.02 0.01 0.07 0.01 0.02 0.09 8 Cash return on equity 0.07 (0.09) 0.05 (0.05) (0.00) 0.10 (Resource: Stoxplus.com.vn and calculating of author) 3.3.1. Achievements As can be seen from the table, the affordability is low, often maintain less than 1. -7- The food processing enterprises have covered several contents of cash flow management such as management of receivable and payable accounts, provision for bad debts despite the fact that the management is not paid as much attention as profitability. These enterprises have applied some measures to deal with temporary surplus or shortage though funds have not been developed optimally. Net working capital is maintained stable. Most of the businesses have already complied the principle of capital allocationis, i.e. short-term capital financing short-term assets, long-term capital financing long-term assets. Thus, the net working capital of these companies has always been to maintain stable and positive (42/53 companies). 3.3.2. Limitations and causes (1) Limitations After analyzing the real situation of cash flow management of these food processing companies, there have existed some of basic limitations including the risk of imbalance between revenues - costs, the low ability to pay the full costs for fixed line money (less than 1), the low solvency for short-term debt, the low ratio of cash flow / sales and and low rate of meeting the full payment needs, the less than zero working capital of some companies, and the low ability to generate cash (receivables> payables). (2) Cause: There are two fundamental reasons as follows. Subjective reasons: the cost of debt and capital structure is irrational; the choice of cash flow management techniques is inconsistent and incomplete; the ability to forecast cash flow is limited; not really building up optimal budget model is not really developed; the scale of production is unreasonable; there are not financial management speaclists; financial executives do not take cash flow management into account; derived services and risk reduction of exchange rate are not selected; the trade credit policy is not flexible and not directly linked to -8- the changing market conditions. Objective reasons: First, the interest rate policy of the State has changed and interest rates on the financial market are unpredictable. Second, economic cycles affect the operation of the business, and accordingly managing cash flow is easier or harder based on the economic cycle. Third, exchange rate risk and exchange rate policies do not facilitate export companies. The products and services of financial markets and financial institutions are limited. Trading tools for commercial credit are undeveloped. Besides, the quality of financial statements, especially statements of cash flows is not high. Supporting services for public liability do not grow, especially through the establishment and operation of debt trading companies and commercial arbitration centers. Conclusion of Chapter 3 On a theoretical basis for cash flow management, definitions of factors affecting cash flow management, and the results of surveys and in-depth interviews to analyze the actual circumstances of cash flow management among these companies, some lessons are drawn besides several certain achievemnts. The most major limitation is that these companies do not take care of planning and forecasting cash flow. They have not chosen any model to forecast cash flows. Cash flow forecasts are often combined with financial planning annually. It is obviously showed that the demand for money has not been determined suitably for business operations, so negative cash flow on a quarterly basis is common in many businesses. In addition, most of the companies have not yet realized the role of determining optimal budgets and building a suitable model of optimal budgets. -9- Chapter 4 SOLUTIONS TO STRENGTHEN CASH FLOW MANAGEMENT OF FOOD PROCESSING COMPANIES LISTED ON VIETNAM’S STOCK MARKET 4.1. Direct Solutions 4.1.1. Cash flow forecast Developing regression models for multivariate time series is to forecast cash flows from operations of a group of 53 companies. The regression equation is constructed as follows: CFT = a + b1 (CFT-1) + b2 (OIBDt-1) + b3 (rect-1) + b4 (INVT-1) + b5(PAYt-1) + Et (4.2) Dependent variable: CFT is operating cash flow in a year t Independent variables: OIBDt-i is operating income before depreciation in a year ti RECt-1 is receivable in a year t-1 INVt-1 is the inventory in a yeart-1 PAYt-1 is payable in a year t-1 Et is variable Testing Methodology: There are three methods of testing and estimating parameter of the regression equation: - POOLS (pooled OLS) - Random effects (random effect factor) - Fixed effects (fixed effect factor) -10- Hypothesis: H0: bi = 0 (Xi has no relationship with CF) H1: bi ≠ 0 ((Xi has a relationship with CF) Using STATA 11 and the data of 53 LPP companies in the period from 2007 - 2012. The testing and estimation steps are performed as follows: Step 1: Declare the dependent variable and independent variables of the equation (4.2). Step 2: Conduct to test the hypothesis. The test of chaging error variance for POOLS and random effects methods showed showed that error variance changes. Thus, to test and estimate the coefficients of the model, it is necessary to use the fixed effects method. The results are shown as follows: Table 4.4. Hypothesis Results Step 3: Write the regression equation. -11- Based on the results of running the model in Table 4.4, the regression equation is defined as follows: CF t = - 87.512,43 + 0,4210556 (OIBD t-1 ) + 0,4276063 (REC t-1 ) + 0,6955193 (INV t-1 ) – 0,4129928 (PAY t-1 ) + e t (4.3) The meaning of the model: The model is used to forecast cash flows based on financial data related the history. According to the regression equation (4.3) on cash flow which has been developed in conjunction with the data of listed food processing enterprises in the period of 2007 - 2012, the cash flow of these businesses will be predicted. 4.1.2. Setting up a precondition for building optimal budget Case Study: Applying the Stone model for building optimal to NTACO JSC,. Step 1: Set the lower limit for the fund balance. This limit is related to the level of spending security. Based on the fund balance (cash and cash equivalents) quarterly for the period from 2007 to 2012, combined with the demand for cash during the next year and interviewed the chief accountant / chief financial officer, the amount of minimum reserve is determined. L = 23935.2 million VND Step 2: Estimate the standard deviation of the cash flow According to the historical data of NTACO cash flow, revenue and expenditure budget variances are defined as: Vb = 7221778859.1 million VND. Step 3: Decide the interest rate to determine the opportunity cost NTACO does not make short-term investment in securities for the purpose of ensuring safety for payment activities. Hence, the opportunity cost is based on the interest rate prescribed by the central bank to commercial banks’s capital raising activities. As discussed above, the interest rate is 10.05% / year. Step 4: Estimate transaction costs related to selling or buying short-term securities -12- NTACO does not trading short-term investment in securities for the purpose of ensuring liquidity and transaction costs of deposits are negligible (in the interviews). Therefore, the transaction costs are tiny too. (Cb = 1) Thus, the optimal cash reserves = Optimal cash reserves = 29,931.25 million VND In sum, optimal cash balance = 29.931,25 tr.đ High cash balance: H = 3Z - 2L = 41.293,38 Chart: Cash Cash at bank/ Buy Securities H1 = 41.293,38 Z*= 29.931,25 L1 = 23.935,18 Cash at bank/ Sell Securities Time 4.2. Mô hình quản trị dòng tiền của Công ty NTACO Step 5: Handling the budget surplus or deficit a. Assumptions: NTACO use a credit line for 2013. Credit limits are determined as follows: (in Appendix 1) Credit Limit Demand in 2013 = 279 billion VND b. Handling the budget surplus or deficit The cash flow forecasted for 2003 as in the forecast equation 4.2 was 23,621.94 million VND. Compared with optimal cash reserve Z * = 29,931.25 million VND From this, it is easily seen that NTACO company will have budget surplus. -13- Surplus amount = 6,309.31 VND. Due to the fact that Vietnam's stock market is potentially at short-term risk and NTACO cannot make short-term investments in the stock market, so the most appropriate thing to do is that NTACO should make short-term cash investments in short-term deposits at An Giang Vietcom bank. The three – month period interest rate for deposit was 6.8% / year (according to the bank's interest rates). Hence, the interest that NTACO obtained from short-term investments of idle cash is: 6309.31 x 6.8% / 4 = 107.26 million VND (Detailed assessment of the impact of cash flow forecasting, optimal budget building on operating efficiency of NTACO JSC, see Appendix 1) 4.1.3. Strengthening governance debt - Assign decentralization workers who are in charge of receivables, payables, cash separately. - Enhance the recovery of receivables. - Extend the time of payable payment. - Balance the revenue - expenditure on the level of importance and reconciliate with cash accounting. - Change the appropriate sales policy. 4.2 Supplementary solutions 4.2.1. Developing human resources - The separation of the chief accountant and chief financial officer is needed in the financial management of enterprises. - Increase awareness of leadership and management about cash flow. - Raise awareness of employees about the importance of cash flow for businesses. -14- 4.2.2. Developing a suitable production and business plan It is necessary to combine doing market research and developing a production plan to help these businesses plan an appropriate capital budget, select funding channel as well as construct funds with the aim of not affecting solvency. 4.2.3. Developing flexible sales policies and enhancing marketing activities Sales policy should be developed consistantly and steadily, decentralized markedly among agent groups to create a partition (North, Central, South), urban and rural areas. According to the BMI overview report about food processing enterprises (2013), Vietnam has a large income gap between urban and rural areas, so the consumption pattern of these companies should change based on income. They need to make the products in accordance with the tastes and incomes of each type of market. Therefore, marketing policies should be developed to suit each market segment. 4.2.4. Using a variety of products and services of commercial banks The survey resultsc show that most of the companies only use international payment operations as basic as L/C or T/T and are not interested in the derivatives business. Meanwhile, rates have a huge effect on foreign trade transactions. Exchange rates of currency pairs are constantly fluctuating. Therefore, the exchange rate risk is inevitable. To reduce the negative impact of exchange rate risk, the companies should choose the derivative transactions of commercial banks. 4.2.5. Some other solutions - Picking up to build cash flow management software. - Combining a portion of cash flow management and other parts of the accounting software. - Managing order automation. - Use additional indicators reflecting the quality of the cash flow of the businesses apart from indicators reflecting traditional solvency which is being widely used in the financial analysis in Vietnam. [...]... evaluation of the real sitauation of cash flow management of the food processing companies in chapter 4, the writer has proposed direct solutions (3 solutions for forecasting cash flow, building up optimal budgets and managing the inventory), complementary solutions (consist of 7 solutions) and recommendations for the implementation of these solutions to enhance cash flow management of the business on Vietnam s... complementary solution (5 solutions) and has proposed the conditions for the implementation of these solutions to enhance cash flow management of the food processing businesses listed on Vietnam' s stock market In the given solutions system, applied research for cash flow management situation at the NTACO company are illustrated as practical solutions 5 Limitation of the Research Limitation of this study... content of cash flow management of the business This problem is a suggestion for further research The research scope is limited to the cash flow management of the food processing listed companies Therefore, it can be expanded for food processing businesses in Vietnam (including listed and unlisted food processing ones) This is also a controlled study to compare the administration of the cash flow of. .. management of corporate Vietnam cash flow, cash flow management which need to be understood as a process of 3 Results of the survey, interviews and analysis management In addition, the author has constructed the evaluation criteria system for cash flow management of the business On the basis of these indicators, the authors evaluated the administration of the cash flow of the processing food businesses in Vietnam. .. objective and content, the corporate finance analysis Since then, the author has basis to propose assessment criteria for cash flow management, to the factors affecting the cash solution as well as propose the conditions for solutions to enhance cash flow flow management of the business management of the food processing companies listed on the stock market of The author introduces the concept of comprehensive... companies direct impact on the operation of businesses in general and food processing enterprises in particular Therefore, in the transition of post-recession period, State bank should consider the liberalization of controling mechanisms of interest rates to ensure the benefits of both commercial banks and enterprises, and stabelize the operation of the economy 4.3.4 Recommendations for commercial banks... in-depth interviews, analysis, testing and assessment of real methods are used to quantify the impact of several factors on cash flow situation of the cash flow management of food processing listed businesses, the management of the business From there, the author analyzes and assesses the author has proposed ê direct solutions (3 solutions of cash flow forecast, -17- -18- building up optimal fund and... number of new indicators to The author outlined the basic theoretical issues of cash flow management of the reflect the quality of the cash flow of the business beside the indicators reflect enterprise including: an overview of the cash flow of the business, overview of the ability to pay (payment) in a traditional way which is being widely used in cash flow management of the business from concept,... support the information for analysis and evaluation of cash flow interviews with processing food listed businesses, financial experts and management of these businesses auditors The results of statistical analysis and evaluation showed that cash flow The author has used a combination of qualitative and quantitative research management is not adequately concerned by food processing listed businesses methods,... author has done in-depth interviews with 4 food processing listed secondary sources are through the financial statements of the processing food businesses on HSX and 4 food processing listed businesses on HNX, and listed companies which have financial year ended annually on December 31st consulted financial experts and the auditors who audited food processing listed for the period from 2007 to 2012 Primary . generate cash from operations of the business: The ratio of cash flow/ revenue; The ratio of cash flow/ profit after tax; The ration of cash flow/ assets; The ratio of cash flow/ equity; The ratio of cash. referring to cash flow of a company, there is not a concept of money flow in general, we need to understand the concept of cash flow through cash inflows, outflows and net cash flow. Net cash flow. listed on the Vietnam stock market. Chapter 4: Solutions to enhance cash flow management of food processing enterprises listed on the Vietnam stock market. -4- CHAPTER 1: OVERVIEW OF