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How is cash days calculated for a company ?

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Question added by SAI ANIMESH KUMAR N , Senior Manager, Credit , Ahli United Bank
Date Posted: 2015/06/18
SAI ANIMESH KUMAR N
by SAI ANIMESH KUMAR N , Senior Manager, Credit , Ahli United Bank

Cash days is a very important measure as it tells us how much cash is needed to deal with monthly operating expenses. 

Cash days = cash / (monthly cash operating expenses)

After all cash management is very important for any business as the financials may look strong but a cash deficit may not be ruled out which is very harmful for any business.  

 

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