Cash management refers to an organization’s processes for managing the inflow and outflow of funds to optimize liquidity, ensure financial stability, and meet operational needs. This includes overseeing cash receipts, payments, and forecasting cash flow. While payment terms (Option A) and payroll disbursements (Option B) are components of cash management, they are not the comprehensive definition. Enterprise resource planning systems (Option C) are tools that may support cash management but are not the definition itself.

The web source from Corcentric states: “Cash management involves managing an organization’s inflow and outflow of funds to maintain liquidity and meet financial obligations.” This directly supports Option D.

The IOFM APS Certification Program covers “Payments,” including cash management principles as they relate to AP processes. The curriculum’s focus on “peer-tested best practices” aligns with the definition of cash management as managing cash inflows and outflows.