Simple idea of leave is that employee should utilize them, HR restricts approval of leaves to employees stating reason of work loss, bipin, take situation of a any company, there are lots of people, and each one has his own problems so a person may take sometimes leave above quota and make it LOP or a person may take leave exactly as per quota,, and so on,, but if a policy is made as per finance person, the employees will be forced or they themselves will be motivated to take leaves and give rest to their body and minds, which is a good option, and they will try to spend their leaves or get it encashed at end of the year,
and if there is no limit then there will be pressure from HR, and HR will never sanction casual leaves, HR will tell employee why you want to take leave, let it be encashed,
and i feel leaves are best encashed at end of the year, because dear why keep anything pending with the company,, finish it year after year,, so even if finance person makes decision of encashing after one year, it wont do much harm wot say ?