It is necessary to allocate "inflows" and "outflows" of money on the primary (operational) activity, investment and financial to kinds of activity.

Kinds of activity. Inflows of money. Outflows of money

Table 1.1 Components of a cash flow

Operational	Monetary proceeds from sales of production in the current period. Repayment receivables. Receipt from barter sale. The advance payments received from buyers.	Capital transfers of suppliers and contractors. Payment of a salary. Contribution to the budget and off-budget funds. Payment of percent for the credit. Assignments on the social sphere.
Financial	Short-term credits and loans. Long-term credits and loans. Receipts from issue of shares. Target financing.	Return of the short-term credits and loans. Return of the long-term credits and loans. Payment of dividends. Repayment of bills.
Investment	Sale of fixed assets, intangible assets. Dividends, percent from long-term financial investments. Return of other financial investments.	Acquisition of fixed assets, intangible assets. Capital investments. Long-term financial investments.

Liquid securities more are suitable for realization of function of insurance of the current production. (In Russia - the state bonds.) Liquid securities bring to firm some level of the income. Set of money and liquid securities is called cash or liquid assets. When receipts of money and monetary payments are coordinated on a certain prospect, the firm can have rather small stocks of money. But if the risk of mismatches is considerable, investments into short-term liquid securities are necessary. Of course, the demanded volume of cash increases if the part of transactions is paid with cash, and decreases if the firm can quickly obtain the credit on desirable conditions. The interest rate is higher, the interest of firm in decrease in monetary cash is more.

The minimum quantity of monetary cash which the firm has to have on the settlement account and in cash desk, is defined by two processes. The first - a period between payment of account the buyer and encashment of money. This time consists of three parts:

- time of the translation of payments from buyers (receivables aren't considered here, the buyer paid the bill, but on its transfer the firm needs the certain time depending on a form of clearing settlements and overall performance of banks);

- time during which payments remain not collected banks;

- time of cash flow to the banks making payments.

Firms can use many methods of reduction of the period of collection, and consequently, and the demanded stocks of money (wire transfers, system of safes, etc.). But this period will always take place, always there will be transactional expenses.

The second - requirements of commercial banks about formation of the compensation (reserve) remains. These remains are defined by the cost of services of the bank operating settlement accounts and granting the loans. (For example, the bank can serve firm free of charge if not reduced rest on the account not less than 50 million rubles. Otherwise the firm pays each operation of bank).

CHAPTER II ANALYSIS OF CASH FLOW