The Improved Research On Centralized Capital Management Of HK Grain Group

Since joining the WTO, the economic development of China is gradually tend to be diverse and global, trans-regional operating is more and more general, at the same time, Group begin to appear and become a new economic form. But regional differences make the financial management of group face greater challenges, especially financial management. How to improve capital efficiency and reduce the cost of funds, has always been one of the major problems which perplexes the Enterprise Group. Practice shows that strengthening the centralized management of funds can achieve the transfers of funds intra-group, reduce the cost of capital and financial risks, and improve the efficiency and effectiveness of the use of funds, At the same time it can optimize the allocation of the resources and enhance the company s strategic control over the members of the unit, at last ensure the smooth implementation of major strategic planning.The research, on HK Grain Group, combined with the basic situation, characteristics of the industry and capital operation rules, points out that the current situation of funding centralized management in HK Grain Group, such as dispersed idle funds, high savings and loan, large amount of financial costs. Then the author analyzes the causes that lead to those problems based on the importance of the influencing factors. On the basis of the analysis of the current situation and the causes, the author points out some targeted solutions from the five dimensions including the organizational structure, management systems, personnel skills, implementation process of centralized fund management and specifically model. And, the author continues to introduce the cash pooling model to HK Grain Group, in order to strengthen financial management and improve the Group’s overall capital efficiency, combining with the characteristics, the advantages and disadvantages of the various funds centralized management model. By the cash pooling, the parent company can keep abreast of the cash flows of each sub-account, clear responsibilities and effectiveness of internal controls so that it is easy to manage. Second, the cash pooling can gather the excess funds of the group, and conduct more effective investment activities to increase revenue for the group. Even if the group does not carry out investment activities, large deposits can also obtain a higher deposit rate. Then the author describes the necessity and feasibility on the introduction of cash pooling dialectically, specific applications of cash pooling in HK Grain Group in detail when introducing cash pooling so that the countermeasures seem operational and helpful for other business groups to solve the similar problems.