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A linear programming model has been developed for optimal cash flow management addressing specific cash flow issues related to the construction industry. These include typical financial transactions, possible delays on payments, use of available credit lines, effect of changing interest rates, and budget constraints that often occur in the construction industry. A small size project from the Brazilian construction industry is provided as a case study, aiming at evaluating the potential benefits from using the model. Different changes to the basic structure of the model allow and establish the consistency of the results. Alternative formulations are suggested to deal with uncertainties, longer planning horizons, and multiple subcontractors and suppliers. In addition to the tangible financial earnings derived from the optimization process, the simple structure of the model, as a network flow and corresponding equations, provides much visual insight concerning the relationships between the external inputs and the variables of the problem. Optimal results have yet to be achieved in a real life situation, but a better view of whole cash flow management is provided when using the model.
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