Notional pooling (See Chapter 46 of the Vernimmen) Notional pooling provides a relatively flexible way of exploiting the benefits of cash pooling. With notional pooling, subsidiaries’ account balances are never actually balanced, but the group’s bank (see concentration bank) recalculates credit or debit interest based on the fictitious balance of the overall entity. This method yields exactly the same result as if the accounts had been perfectly balanced, but the fund transfers are never carried out in practice. As a result, this method leaves subsidiaries’ some room for manoeuvre and does not impact on their independence. Notional pooling (See Chapter 46 of the Vernimmen) Notional pooling provides a relatively flexible way of exploiting the benefits of cash pooling. With notional pooling, subsidiaries’ account balances are never actually balanced, but the group’s bank (see concentration bank) recalculates credit or debit interest based on the fictitious balance of the overall entity. This method yields exactly the same result as if the accounts had been perfectly balanced, but the fund transfers are never carried out in practice. As a result, this method leaves subsidiaries’ some room for manoeuvre and does not impact on their independence. See all terms in the dictionary of finance To know more about it, look at what we have already written on this subject :

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Definitions of terms begining with the same letter as "Notional pooling" :

NASDAQ NAV NBV NOPAT NOPAT multiple NPV NWP NYSE Natural disaster risks Natural hedge Negative capital employed Negative covenant Negative working capital Net Book Value Net Written Premium Net asset value Net asset value of a fund, NAV

Net assets Net assets per share Net debt Net financial debt Net financial expense/income Net fixed assets Net income Net pension costs Net present value Net profit Net worth Net worth test Netting New equity puzzle Nominal rate Nominal value Nominee agreement

Non core-assets Non investment grade, non-investment grade Non recurrent items Non recurring items Non-monetary items Non-operating assets Non-operating working capital Non-recourse discounting Non-voting shares Normalised cash flow Normalised earnings Normative analysis Normative cash flow Normative margin Notes to the accounts Notional amount Notional pooling