Cash Hoard


DEFINITION of 'Cash Hoard'

A large amount of available money held by a company in anticipation of facilitating future projects or meeting future financial obligations. A cash hoard held by a company often makes the company attractive as a target of acquisition because of its sound financial situation.

Also referred to as a "cash reserve."


Analysts make frequent speculations regarding the purpose of the firms' surprisingly large cash hoards. Some economists argue that government measures to reduce interest rates and encourage borrowing and spending have, instead, led corporations to hoard more cash, rather than investing the money in expansions that would lead to new jobs. When the economy falters, companies may choose to increase their cash-to-assets ratio to avoid loans and debts, and to limit risks.

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  1. Can working capital be depreciated?

    Working capital as current assets cannot be depreciated the way long-term, fixed assets are. In accounting, depreciation ... Read Full Answer >>
  2. Do working capital funds expire?

    While working capital funds do not expire, the working capital figure does change over time. This is because it is calculated ... Read Full Answer >>
  3. How much working capital does a small business need?

    The amount of working capital a small business needs to run smoothly depends largely on the type of business, its operating ... Read Full Answer >>
  4. What does high working capital say about a company's financial prospects?

    If a company has high working capital, it has more than enough liquid funds to meet its short-term obligations. Working capital, ... Read Full Answer >>
  5. How can working capital affect a company's finances?

    Working capital, or total current assets minus total current liabilities, can affect a company's longer-term investment effectiveness ... Read Full Answer >>
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