Hello
I had the same idea. But a bit cleaner.
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### **Proposed Financial Reserves & Cash Management Policy**
To optimize cash flow and prevent excessive capital hoarding across divisions, the following tiered structure for **On-Hand Cash** and **Reserve Limits** is proposed:
#### **1. On-Hand Cash Limits**
Each division maintains a strict threshold for daily on-hand operating funds. Any capital exceeding these limits automatically rolls over into the division's reserve account.
* **Division 5:** $1,000,000
* **Division 4:** $2,000,000
* **Division 3:** $2,500,000
* **Division 2:** $3,000,000
* **Division 1:** $5,000,000
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#### **2. Reserve Caps & Holding Rates**
Reserves earn a percentage yield at the end of the year for holding cash. However, each division has a maximum reserve cap.
*Similar to commercial banking models, holding rates and penalty fees scale based on the total volume held—meaning larger balances face higher structural adjustments.*
* **Division 1:** $35,000,000 reserve limit *(Highest threshold)*
* **Division 2:** $20,000,000 reserve limit
* **Division 3:** $10,000,000 reserve limit
* **Divisions 4 & 5:** $5,000,000 reserve limit
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#### **3. Over-Limit Penalties**
Exceeding the designated reserve limit triggers severe financial penalties, particularly for lower divisions.
> **Example:** If a Division 4 manager accumulates **$30,000,000** in their reserves (significantly above the $5,000,000 limit), their penalty holding fee will be enormous.
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Now this isnt perfect but it’s fair. I hope you give me kind reply on this format