“What is the current wisdom on the best way to manage cash reserves and to manage the risk of big CapManEx costs in the future?” RWSN Discussion Synthesis

Description:

This document is a synthesis of an online discussion that took place in June 2014 on Dgroups (Management & Support Community) and on the "WSP-RWSN Webinar Discussions" LinkedIn group in response to the following question:

“In Tajikistan a multi-village piped water scheme is successfully collecting user fees from households. This has created a new problem: a sizable reserve. This would seem to be in line with the object of the tariff, however for covering the costs of a big item that may need replacing in the next 20 years or so this raises a challenge: there is increasing pressure to use those reserves in a more productive way (and some less productive ways) sooner. There is also the risk that inflation will mean that a good amount of money today will not be worth the same in 10-20 years when it is needed for a big capital expenditure. From WASHcost and other work, what is the current wisdom on the best way to manage reserves and to manage the risk of big CapManEx costs in the future?”

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Bibliographical Information:

FUREY S. G. (2014) “What is the current wisdom on the best way to manage cash reserves and to manage the risk of big CapManEx costs in the future?”. RWSN Discussion Synthesis , Skat , RWSN , St Gallen, Switzerland

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