Bayt.com

Start networking and exchanging professional insights

Register now or log in to join your professional community.

Follow

What is Cash Conversion Cycle?

Project Finance Cash Flow Forecasting Financial Reporting Financial Systems Feasibility Studies
user-image
Question added by Shahbaz Hayder , Group Head of Finance , Sharif Group of Companies
Date Posted: 2015/05/19
Upvote (2) Views (1) Followers (3) Answers (1) Report Question
Write an Answer
Register now or log in to answer.
Zahid Farooq
by Zahid Farooq , Taxation and Accounting Director , BMS Auditing

cash conversion cycle is used to measure the efficiency and effectiveness of the management to recover the cash used in the operations. It is measured by using the three ratios

  1. days sales outstanding (DSO)
  2. days inventory outstanding (DIO)
  3. days payable outstanding (DPO)

so 

Cash Conversion Cycle (CCC)= DSO+DIO-DPO

 

Write Your Answer
More Questions Like This