On the Decomposition of the Municipal Cash Management Problem Using an Interactive Approach

Decomposition of the municipal cash management problem into monthly and daily decisions is considered and conditions presented which guarantee that the decomposition is wel defined. Under certain conditions, infeasibilities at the daily level can be easily translated into necessary conditions for the monthly problem resulting in an iterative procedure. The decomposition allows the monthly problem to be solved on readily available time sharing systems and the daily problem to be solved by the financial officer.