The correct answer is D. All of the above.
The funds management subsystem is responsible for managing the organization’s cash flow. This includes increasing cash input, decreasing cash output, and balancing cash inflow with outflow.
Increasing cash input can be done through a variety of methods, such as increasing sales, collecting receivables, and borrowing money. Decreasing cash output can be done through a variety of methods, such as reducing expenses, delaying payments, and investing in assets. Balancing cash inflow with outflow is important to ensure that the organization has enough cash on hand to meet its obligations.
If the organization does not have enough cash on hand, it may be forced to borrow money, which can be expensive. It may also have to delay payments to its suppliers, which can damage its relationships with them. In extreme cases, the organization may even have to file for bankruptcy.
Therefore, it is important for the funds management subsystem to effectively manage the organization’s cash flow. This will help to ensure that the organization has enough cash on hand to meet its obligations and avoid financial problems.
Here is a brief explanation of each option:
- Option A: Increase cash input. This can be done through a variety of methods, such as increasing sales, collecting receivables, and borrowing money.
- Option B: Decrease cash output. This can be done through a variety of methods, such as reducing expenses, delaying payments, and investing in assets.
- Option C: Balance cash inflow with outflow. This is important to ensure that the organization has enough cash on hand to meet its obligations.