Tax law requires that you pay taxes currently on advance payments and prepayments.
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Its cash balances are certainly nowhere near large enough to match its net prepayments.
And as long as rates stay up, forget about loan prepayments that result in your bond getting called away.
It points out that around euro1.7 billion of prepayments have been spent in making advance payments to its own suppliers.
When housing was booming, many investors saw mortgage prepayments, and the need to reinvest in lower-yielding paper, as the big risk.
Alstom currently has euro6.27 billion of net prepayments on its balance sheet.
The uncomfortable implication is that Alstom's performance in previous years has been flattered by such prepayments and that the price today is a liquidity crunch.
Alstom faces two other nasty financial issues: debt and customer prepayments.
The problem with prepayments is not that they shorten the effective life of the pool but that they give homeowners an option on whether to repay.
If a company manages its contracts poorly, it can soon start to resemble a pyramid scheme, in which prepayments from new orders become vital to finance the completion of old contracts.
Raymond Greaves, an analyst with Merrill Lynch, has calculated that, in March, there were around euro4 billion of net prepayments on the liability side of Alstom's balance sheet for which he cannot clearly identify liquid assets.
If the money is simply absorbed into the general business, there is a danger that ongoing projects will need large injections of cash that can be found only by borrowing or by advancing cash from new prepayments.
In early November Alstom announced a euro421m cash outflow and said that this related largely to four contracts for which it had received substantial prepayments but which are now reaching completion and so draining cash from the business.
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