Use of a deterministic cash flow model to support manager decisions

The aim of the article is to analyze the influence of certain types of cash flows (from operating, investing, and financing activities) on the change in cash balances, i.e. total cash flows in economic entities. The article uses a deterministic cash flow model based on the formula of the cash flow statement according to which the total cash flow, i.e. net change in cash, is the sum of the operating cash flows, investment income minus investment expenditure, increased by financial income and reduced by financial expenditure. The results of the research indicate that Polish listed companies that are subject to the research are characterized by positive operating cash flow, low capital expenditures and low financial inflows in the years 2009-2019. A contribution to the theories and practice is the broadening of knowledge in finance theory on cash resources, which were confirmed by research and conclusions concerning the analysis of Polish joint-stock companies in the emerging market. The study indicates substantial cash accumulation, low use of external financing, i.e., high financial flexibility. The deterministic model of cash flows presented and used in the article is to support managerial decisions. The analyzed model may constitute the basis for building an IT system that could be used to manage the finances of enterprises. The system will use cash data, which is an important and better source of information than accrual data.