<b>Amit Tandon:</b> A way out of the cash hoarding problem

If companies paid out large amount of earnings as dividends, cash accumulation would not be an issue

The outcry over the cash on Infosys’ balance sheet for buy-backs has brought into focus the use of cash that has been steadily allowed to accumulate on the balance sheets of companies. While TCS has agreed to spend Rs 16,000 crore on buy-back, this remains a burning issue for Infosys. The best use of accumulated cash is something all boards should constantly think about. After all, the use of cash, more broadly capital allocation and succession planning, are the two more important decisions boards get to take.

Cash on the balance sheet often dampens returns. For one, cash in the bank