Cash And Cash Equivalents

RECENT NEWS
BBC News  Nov 25  Comment 
One US Federal Reserve bank official, Neel Kashkari, wants his country's banks to keep much higher cash reserves, to reduce the chances of another major financial crisis.
The Economic Times  Nov 10  Comment 
To counter such frauds, government will check the unnatural rise in the cash reserves in these banks. They will be under scanner.
MarketWatch  Nov 8  Comment 
The French oil company said it will avoid U.S. sanctions on Iran by using its own euro-denominated cash to finance its share of an Iranian gas project.
guardian.co.uk  Oct 6  Comment 
How did a substance that falls from the air, springs from the earth and comes out of your tap become a hyperactive multibillion-dollar business? The dress code of the clientele in Planet Organic, Notting Hill is gym chic. On a hot day in...
Forbes  Oct 4  Comment 
Too often a straight line has been drawn between Arsenal’s cash reserves and the erroneous conclusion that it equals a transfer kitty. It is far too simplistic – a bit like checking your bank statement and assuming that the balance is...
The Hindu Business Line  Oct 3  Comment 
The liquor-maker is moving away from production, marketing of lower-end brands
The Economic Times  Sep 27  Comment 
An interest coverage ratio of below 1 means the company is not generating enough revenue to service its interest costs and may need to draw from its cash reserves.
Motley Fool  Sep 10  Comment 
Here are the facts about Medicare's funding problem and what we could do about it.
The Economic Times  Jul 19  Comment 
Coal India’s consolidated cash reserve stands at around Rs 38,000 crore of which Rs 8,500 crore belongs to Eastern Coalfields, Western Coalfields, Bharat Coking Coal.
Reuters  Jul 5  Comment 
Stocks on major world markets fell and benchmark U.S. government bond yields hit all-time lows on Tuesday as worries about Britain's exit from the European Union pushed sterling to a fresh 31-year low, triggering a scramble for the safest and most...




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Cash and cash equivalents are assets in actual cash or quickly convertible to cash

Cash and cash equivalents are the most liquid current assets found on a company's balance sheet. They are assets that are easily and quickly converted into cash or are, in fact, cash. It should be noted that while functionally "cash equivalents" are eponymously equivalent to cash, this is not literally true; the Financial Accounting Standards Board (FASB) defines "cash equivalents" as highly liquid securities with maturity of 3 months or less. As such, a three-month treasury bill would be considered a cash equivalent.

A company's ability to generate cash a keep cash and cash equivalents is a primary indicator of its health. Companies with disproportionately high net assets relative to its cash and cash equivalents is generally an indication of non-liquidity.

For individual investors and companies, cash and cash equivalents are generally considered to be a safe investment with low risk and low returns. That is to say, maintaining significant assets in cash and cash equivalents (rather than investing them in securities or back into the company) is a low-risk investment strategy.

Examples

Examples of cash and cash equivalents are:

  • Cash in a bank account
  • Physical cash on hand
  • Certain Treasury Bills
  • money market instrument

Cash and Cash Equivalents data on Wikinvest

Wikinvest calculates Cash and Cash Equivalents by including cash at hand, restricted cash and gold bullions (except in the case of gold producing companies). Short-term investments such as commercial paper, T-bills or time deposits are included under the metric short-term investments.

The result may be different from other finance web portals (such as Yahoo! Finance) due to a different treatment of short-term investments. Cash For Gold Belfast

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