Prudence shown by business splashing money around (7)
I believe the answer is:
economy
'prudence' is the definition.
(I know that economy is a type of frugality)
'business splashing money around' is the wordplay.
'business' becomes 'co' (short for company).
'splashing' indicates anagramming the letters (I've seen 'splashing of' mean this (I've seen this in other clues)).
'around' means one lot of letters goes inside another.
'money' anagrammed gives 'enomy'.
'co' going within 'enomy' is 'ECONOMY'.
'shown by' is the link.
(Other definitions for economy that I've seen before include "Careful use of resources" , "Thrifty management of resources" , "Judicious expenditure of money" , "Country's financial state" , "Thrift - national production, distribution and consumption" .)