CASH MANAGMENT PRACTICE IN

COMMERCIAL BANK OF ETHIOPIA

(A CASE STUDY ON ALEM BANK SEBETA BRANCH)

A RESEARCH PAPER SUBMITTED IN PARTIAL

FULFILMENT OF B.A BUSINESS MANAGEMENT

SUBMITTED BY:

1. TESFAHUN BAHIRU

2. TIGIST BEYENE

3. TEKLEBRHAN GEBREYES

ADVISOR:

HAILEMARIYAM

DEPARTMENT OF BUSINESS MANAGEMENT

COLLEGE OF BUSINESS AND ECONOMICS

NEW ABYSSINIA COLLEGE

JANUARY; 2018

ADDIS ABABA, ETHIOPIA

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 ABSTRACT
This research paper Ethiopia to address the cash management practice of Commented [l1]: ????????????

commercial bank of Addis Ababa branch. This research addressed five

basic research questions designed to asses cash management performance
of the bank. For the purpose of the attainment of the objectives of this study
both primary and secondary data were used, but much focus on primary
data in which more information was obtained by interview and
questionnaires. After the data was collected, it was analysed and presented
through descriptive statistics - tabulation and percentage method. Commented [l2]: Abstract should include…objective,
methodology, major findings and major recommendation in
ONE paragraph ITALIC format

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 ACKNOWLEDGEMENT
First of all we would like to extend our special thanks to our Advisor Ato
Hailemariam for this generous and unreserved assistance to carry out the
research paper. Next, we thank for new Abyssinia College especially, the
colleges of Business and economics for designing such program through
which student’s development their knowledge. Finally we would like to
thank for in commercial bank employees for their supporting me all
aspect of doing this paper.

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 TABLE OF CONTENTS

Title Page

Abstract .............................................................................................. .I
Acknowledgment .................................................................................. II
Table of Content .................................................................................. III Commented [l3]: List of tables
Acronyms
CHAPTER ONE
1. Introduction ……………………………………………………………….…… 1
1.1 Background of the Study .......................................................... 1
1.2 Background of the Organization ................................................. 2
1.3 Statement of the Problem........................................................... 4
1.4 Objectives of the Study ……............................................................ 5
1.4.1 General Objective ………………………………………………… 5
1.4.2 Specific Objectives ………………………………………………. 5
1.5 Significance of the Study ............................................................ 6
1.6 Scope of the Study ..................................................................... 6
1.7 Limitation of the Study ------------------------------------------------- 6
CHAPTER TWO
2. Literature Review ………………………………..…………………….………. 7
2.1 Cash Management ………………………………………………….……… 7
2.2 Control Over Cash ………………………………………………………… 9
2.3 Cash Planning (Budgeting)………..……………………………….……. 9
2.4 Controlling ………………………………………………………………… 10
2.4.1 Segregation of duties …………………………………………… 11
2.4.2 Accountability …………………………………………………… 12
2.5 Reason for holding cash ………………………………………………… 13
2.6 Investment of Idle cash ………………………………………………….. 14
2.7 Managing cash receipt and payment ………………………………... 14
2.7.1 Internal control over cash receipt …………………………. 15
2.7.2 Internal control Over cash payment ………………………. 15

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2.8 Basic internal control principles of cash payment …………………. 16

CHAPTER THREE
3. Research methodology and Design …………………………………………...17
3.1 Area of the Study……………………..………………………………………...17
3.2 The Research design ….……………………………………………………...17
3.3 Data type and source……… ………………………………………………...17
3.4 Method of Data collection…………………………………………………....17
3.5 Sample Size and Sampling Technique….…………………….…………..17
3.6 Data Analysis and Presentation …………………………………………….19
CHAPTER FOUR
4. Data analysis, interpretation and presentation ……………………………..19
4.1 Cash management practice ………………………………………………....22
4.2 Investment of idle cash …………………………………………………….. .23
4.3 Managing cash receipt and payment ……………………………… ….....26
4.3.1 Internal control of cash receipt ……………………………… ……. 26
4.3.2 Control over cash payments ………………………………………….26
CHAPTER FIEV
5.1 Conclusion ………………………………………………………………….….30
5.2 Recommendation ….......................................................................31
Reference ……………………………………………………..………… ……… 32
Appendix ………………………………………………………..………..………33