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FDM-E2 — A group’s cash is used to justify one entity’s payment

  • Situation: A group’s cash balance is used to claim that one member can pay a debt.
  • Question: Which funds can this entity actually use by the due date?
  • First useful result or blocker: An availability and shortfall account for the entity, or an unresolved support condition or receipt.
  • Start with: FDM.2 for the payment boundary, then FDM.1 and FDM.3 for support terms and FDM.4 for what occurred.
  • Stop or return: Finish when the payment question is answered; revise affected availability or support assumptions when an event or term changes.

X owes 100 on day 7 and has 20 of unrestricted cash available then, after all other receipts and obligations. Y holds 150, and the two entities share a founder. FDM.2 distinguishes the founder-group view from X’s payment question. Under these supplied facts, X has an 80 shortfall; adding the two balances does not make Y’s funds available to X.

Now suppose a support arrangement requires Y to transfer 80 before day 7. FDM.1 establishes the relevant obligation and its parties; FDM.3 derives the conditions and timing that would make the support useful. If the arrangement instead guarantees payment only after X’s failure and a valid demand, that is a different conditional route. It cannot be counted as an already available day-7 transfer. If the timing terms are insufficient, the model returns that unresolved condition.

FDM.4 then examines the event that would make the funds usable. A support commitment, transfer permission or sent payment instruction does not establish timely receipt. Suppose a later, adequately established transfer makes 60 usable by X before day 7 and nothing else in the supplied cash account changes. X now has 80 available and a remaining shortfall of 20. This actual result updates FDM.2’s payment account and any FDM.3 scenario that assumed full support. The earlier 80 commitment and the 60 performance remain distinct.

The model can finish with that availability answer, or with the unresolved event when receipt is unknown. The responsible financial practice uses it to compare financing or payment actions. For a different portfolio-risk question, common dependence on the founder may still make the group view useful even when transfer is unavailable. Preserving that view alongside the payment account avoids replacing one question’s answer with another’s aggregate.