FIN.19:5.1 - Follow the financing remedy through its later obligation

Continue the prospective 100/60/20 case above. Suppose both the 30 project and the 20 distribution would be paid on day 7. An obtainable loan can provide net 30 before those payments and requires 31.50 on day 30. On day 30, a separately supported receipt of 40 arrives first, followed by another committed payment of 15 and then loan repayment; no other flows occur, and reserve 20 is required throughout.

On day 7, cash would be 100 + 30 − 60 − 30 − 20 = 20. That resolves the first-date gap. On day 30, however, cash becomes 20 + 40 − 15 − 31.50 = 13.50, below the reserve by 6.50. The financing remedy has moved the conflict to repayment. It is not a jointly feasible continuation under the stated reserve.

For comparison, the same stipulated financing terms at the smaller scale can supply net 10 for the project alone and require 10.50 on day 30. Cash is 20 after day-7 payments and 34.50 after the later receipt, payment and repayment. Distribution alone leaves 20 on day 7 and 45 on day 30 without this loan. FIN.9 and FIN.21 still need the actual value, policy and claimant grounds to choose between those uses; feasibility alone does not establish the preferred allocation.

Deferring the full distribution to day 31 while keeping the loan of 30 gives cash 40 after day-7 operating and project payments, then 33.50 after day-30 repayment. Paying 20 on day 31 again leaves 13.50. A later date alone has not repaired the full plan. At most 13.50 could be paid then while retaining reserve 20 under these exact flows, before applying the separate payout and permission conditions.

Now change only intraday availability: the loan arrives at 15:00, but the project payment is binding at 09:00 after the 60 operating payment. Cash would fall from 40 to 10 at 09:00, already below the reserve. A day-end account showing 20 misses that earlier failure. The commitment arrangement must either obtain earlier funds or select another available sequence before the payment becomes binding.