| Course | GF583 Treasury Management I |
|---|---|
| Unit | Unit 7 |
| Paper type | Surplus investment plan |
| Length | About 840 words, 6 pages double-spaced |
| Format | APA 7 student paper |
| School | Purdue University Global |
| Program | MS in Finance |
| Updated | October 2026 |
Free sample paper for GF583 Unit 7
Three Layers for Eleven Days of Surplus: A Unit 7 Surplus Investment Plan Matched to the Forecast
[Student Name]
Purdue University Global
GF583: Treasury Management I
Unit 7 Surplus Investment Plan
[Instructor Name]
[Date]
The distributor, its policy limits and every rate are composite and illustrative; the articles and textbook cited are real.
The Surplus Profile
The thirteen-week forecast shows a surplus after the quarter's largest customer collections and before a manufacturer payment and a tax deposit absorb it:
1. Days 1 to 4: $42.0 million available above the minimum balance.
2. Days 5 to 9: $61.0 million, after a large distributor rebate arrives.
3. Days 10 and 11: $27.0 million, after weekly supplier payments resume.
4. Day 12: the manufacturer payment and tax deposit use the remainder.
The Policy Box
The treasury's investment policy permits U.S. Treasury bills, government money market funds, overnight repurchase agreements collateralized by Treasuries, and bank deposits at institutions rated in the A category or better. Maximum maturity: no later than the day the forecast shows the cash is needed. No single bank may hold more than $25 million beyond the operating accounts. Safety and liquidity come before yield (Bragg, 2010).
Three Layers
The profile breaks naturally into three blocks, each present for a different number of days.
Layer A, $27.0 million, present all eleven days. This block can be committed for the full period. The plan buys Treasury bills maturing on day 11, priced at a 4.20 percent discount rate, about 4.27 percent on a bond-equivalent basis.
Layer B, $15.0 million, present days 1 to 9. This block, the difference between $42.0 and $27.0 million, is available for nine days. The plan places it in a government money market fund yielding about 4.15 percent, with same-day redemption, so it can be withdrawn on day 10.
Layer C, $19.0 million, present days 5 to 9. This block, the difference between $61.0 and $42.0 million, is available for five days. The plan places it in overnight repurchase agreements with the lead bank at about 4.00 percent, rolled each night.
Income Comparison
The layered plan. Layer A earns about $27.0 million times 4.27 percent times 11 divided by 365, about $34,700. Layer B earns about $15,300. Layer C earns about $10,400. Total: about $60,500.
All in the bank sweep. The concentration account's overnight sweep earns about 3.60 percent. On the same 527 million dollar-days, it would earn about $52,000.
Difference. About $8,500 for eleven days. Repeated after each of the four quarterly surpluses, the approach adds roughly $34,000 a year.
The plan earns more not by reaching for yield but by matching each block of cash to the day it will be needed: only the money present all eleven days goes into a fixed maturity, so no layer ever has to be sold early to meet a payment.
Why Not a Higher-Yielding Instrument
Commercial paper from highly rated issuers yields about 4.35 percent for short maturities, slightly more than Treasury bills. The policy allows only government securities and bank instruments, and the extra yield on $27 million for eleven days would be about $650, not enough to justify the credit risk. Evidence on why companies hold cash points to operating needs and the cost of raising money in a hurry, motives that both favor safety over yield for a surplus that will be spent within days (Opler et al., 1999).
Converting the Treasury Bill Quote
Treasury bills are quoted on a discount basis, calculated on face value over a 360-day year, so the 4.20 percent quote understates the return compared with rates quoted on the amount invested over 365 days. Converting to a bond-equivalent yield, about 4.27 percent, puts the bill on the same basis as the fund and repo rates (Kallberg & Parkinson, 1993).
Risks and Controls
The main risk is a forecast error: if the manufacturer payment arrived on day 10 instead of day 12, Layer A would have to be sold one day early, at a small cost. The plan keeps the minimum operating balance untouched as a buffer. The fund and repo layers can be withdrawn the same day.
How the Plan Fits the Year
The distributor generates a surplus of this shape four times a year, after each quarter's largest collections. Building the layering into the treasury calendar, with each placement scheduled when the thirteen-week forecast is updated, makes the extra income routine. The plan also leaves the policy minimum balance untouched, so the operating accounts never depend on an investment being sold.
Reporting
Each placement will be reported to the treasurer with its amount, instrument, maturity date and the forecast date it matches, so that any mismatch between investments and needs is visible before it becomes a problem.
Who Approves
Placements within the policy can be made by the assistant treasurer, with the treasurer approving any single investment above $25 million.
Recommendation
Approve the three-layer placement for this quarter's surplus and adopt the same method for future surpluses, with each placement documented against the forecast date it matches.
References
Bragg, S. M. (2010). Treasury management: The practitioner's guide. Wiley.
Kallberg, J. G., & Parkinson, K. L. (1993). Corporate liquidity: Management and measurement. Irwin.
Opler, T., Pinkowitz, L., Stulz, R., & Williamson, R. (1999). The determinants and implications of corporate cash holdings. Journal of Financial Economics, 52(1), 3-46. https://doi.org/10.1016/S0304-405X(99)00003-3
The Purdue Global GF583 Unit 7 instructions
The seventh GF583 unit asks for a plan to invest a temporary cash surplus. Start from the surplus profile in the forecast, showing how much is available on which days. Set out the investment policy that governs choices: permitted instruments, maximum maturity, credit quality and concentration limits. Break the surplus into layers by how long each block is available, and assign each layer an instrument whose maturity or liquidity fits. Convert quoted yields to a common basis before comparing them. Compute the income from the plan and from a simpler alternative such as the bank sweep. Explain why higher-yielding instruments were not chosen. Address forecast risk and controls, approvals and reporting. Cite treasury texts and research on corporate cash holdings in APA 7.
How this GF583 Unit 7 example is built
The surplus profile from the forecast opens the plan, followed by a policy box, citing Bragg. Three layers are set out with amounts, days and instruments: bills for $27 million, a government fund for $15 million and repurchase agreements for $19 million. An income comparison computes about $60,500 against $52,000 in the sweep. The highlighted sentence states the matching principle. A section on higher-yielding paper shows its extra yield would be about $650 and cites Opler and colleagues on why firms hold cash for safety. A note converts the bill's discount quote, citing Kallberg and Parkinson. Sections on risks, the plan's place in the treasury calendar, reporting and approvals precede the recommendation. Every placement is tied to the forecast date it matches, and approval limits are set for the assistant treasurer and the treasurer.
Reading the GF583 Unit 7 grading rubric
GF583 investment plans are graded on matching maturities to forecast needs and on complying with a stated policy. Graders check that layers follow the surplus profile, that each instrument fits its layer's horizon and that yields are compared on a common basis. Income calculations must be correct for each layer and for the alternative. Converting the bill's discount quote before comparing it with fund and repo rates is a small step many plans skip, and graders notice it. The analytical share rewards explaining why safety and liquidity outweigh small yield gains for short-term surplus. Instructors in the MS in Finance program value controls, reporting and a repeatable process. A plan that cites Opler and colleagues, Bragg and the corporate liquidity text in APA 7 completes the scoring.
GF583 Unit 7 help from the desk
The most common GF583 Unit 7 error is investing the whole surplus to the latest date, so part of it must be sold early when needs arrive. Others chase the highest yield available without checking policy limits. Treasury bill discount rates are compared directly with money fund yields. Income is computed for the whole period on amounts present only for part of it. Forecast risk is ignored, and single-bank limits are forgotten when repurchase agreements go to the lead bank. Reporting is left out, so mismatches between investments and needs surface too late. For any surplus your case supplies, keep the steps: profile, policy, layers, instruments matched to horizons, common-basis yields, income comparison, risks and a repeatable method.
Get a GF583 Unit 7 example written to your instructions
A surplus profile or the forecast behind it, the investment policy in the Unit 7 case, current rates and the rubric: those are the materials. The custom plan layers the surplus by duration and places each block within policy, net of costs. Expect it inside 24-48h, with the opening request free. The paper above is an original model document written by our desk, not a submitted student paper and not an official Purdue University Global document.
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GF583 Unit 7 questions, answered
Does the plan have to name specific funds or securities?
Usually not. Most prompts expect instrument types, such as a government money market fund, a Treasury bill of a stated maturity or a repurchase agreement, with rates taken from the case or a dated public source. Naming a particular fund adds little and can date the paper. What the grader checks is that each type is permitted by the policy and matures in time.
Why convert a Treasury bill's discount rate?
Because a discount rate is calculated on face value over a 360-day year, while sweep and deposit rates are quoted on the amount invested, usually over 365 days. Comparing them directly understates the bill's return. Converting to an investment yield puts every option on the same basis before any ranking is made, and most rubrics look for that step explicitly.
What if the case gives no investment policy?
Write a short one and label it as assumed: permitted instruments, a maximum maturity tied to the forecast, credit quality limits and any concentration limit. Then apply it consistently. A plan measured against a stated policy can be graded; one that simply picks the highest rate cannot be, and it usually loses the judgment credit for that reason.
Where can I find a free GF583 Unit 7 sample paper?
This page carries a full GF583 Unit 7 surplus investment plan for a distributor's eleven-day surplus, with three layers matched to the forecast, yield conversions, an income comparison and APA 7 references.
Why not put the whole surplus in Treasury bills?
Only $27 million is present for all eleven days. The rest is needed back on day 5 or day 10, so locking it into bills maturing on day 11 would force an early sale.