Cash And Cash Equivalents

RECENT NEWS
Financial Times  Aug 29  Comment 
The Federal Reserve is looking at letting banks use certain types of municipal bonds to comply with a new set of rules on liquid assets
FierceBiotech  Aug 13  Comment 
Merck KGaA is talking up deals again, pointing to its healthy cash reserves and saying it can well afford a blockbuster buyout to bolster its pipeline. But that's been the story for nearly a year, so what's the German giant waiting on?
Financial Times  Aug 1  Comment 
Heightened worries among oligarchs have precipitated the conversion of euro holdings into Asian currencies following the latest round of sanctions
Financial Times  Jul 25  Comment 
Government vows new tax measures aimed at unlocking billions of dollars in corporate cash reserves, in an effort to boost exceptionally low dividend yields
Financial Times  Jul 11  Comment 
Proposal from housing regulator would require the companies to have ‘sufficient level of liquid assets from which to pay claims’ on failed mortgages
OilVoice  Jul 7  Comment 
Sydneybased Petsec Energy Ltd ASX quotPSAquot announce an agreement which will substantially increase its cash resources to US37 million with the sale of selected USA oil and gas interests to
Wall Street Journal  Jun 24  Comment 
Local and foreign banks will be required by Singapore to hold specified amounts of liquid assets in all currencies to cope with a 30-day stress scenario.
Forbes  Jun 9  Comment 
The company is witnessing an eroding top line growth, declining gross margins, high inventory levels, a string of debt maturities and declining cash reserves. Its turnaround initiative, which primarily focuses on re-branding the chain and...
OilVoice  May 29  Comment 
Trapoil AIM TRAP the independent oil and gas exploration appraisal and production company focused on the UK Continental Shelf quotUKCSquot region of the North Sea is pleased to provide a c




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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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