Liabilities, Liquidity, and Cash Management TE AM FL Y Balancing Financial Risks Team-Fly® Liabilities, Liquidity, and Cash Management Balancing Financial Risks Dimitris N. Chorafas JOHN WILEY & SONS, INC. Copyright @ 2002 by John Wiley & Sons, Inc. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 750-4744. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 605 Third Avenue, New York, NY 101580012, (212) 850-6011, fax (212) 850-6008, E-Mail:
[email protected] This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional services. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. This title is also available in print as ISBN 0-471-10630-5. Some content that appears in the print version of this book may not be available in this electronic edition. For more information about Wiley products, visit our web site at www.Wiley.com Preface In all fields of inquiry, whether financial, scientific, or any other, there is danger of not seeing the woods for the trees. Nowhere is this danger greater than in the analysis of assets and liabilities as well as in cash management, in a leveraged financial environment with derivative instruments that change from assets to liabilities, and vice versa, depending on their fair market value. This book is for financial officers, analysts, traders, investment advisors, loans officers, accountants, and auditors whose daily activities are affected by the management of