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cash on hand. Definition. Funds that are immediately available to a business, and can be spent as needed, as opposed to assets that must be sold to generate cash. The amount of cash on hand determines what projects a company can undertake, or what financial hardships can be absorbed, without going into debt or arranging other financing.
Summarize why cash flow accounting is important. 1  Without positive cash flow, a company will not be able to meet its financial obligations, thereby leading to a cash crunch or bankruptcy.  Cash flow is the movement of money into or out of a business, project, or financial product.