Scribd
Upload
41 views4 pages

Cash Conversion Cycle

The document provides instructions for calculating a company's cash conversion cycle (CCC) using data from its profit and loss statement and balance sheet. It defines the CCC as the period in days between paying creditors and receiving money from debtors. The instructions explain how to fill in data on net sales, costs of goods sold, accounts receivable, accounts payable, and inventory for a given period to calculate the CCC automatically.

Uploaded by

Lalit mohan Pradhan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
41 views4 pages

Cash Conversion Cycle

The document provides instructions for calculating a company's cash conversion cycle (CCC) using data from its profit and loss statement and balance sheet. It defines the CCC as the period in days between paying creditors and receiving money from debtors. The instructions explain how to fill in data on net sales, costs of goods sold, accounts receivable, accounts payable, and inventory for a given period to calculate the CCC automatically.

Uploaded by

Lalit mohan Pradhan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
You are on page 1/ 4

P&L statement data Balance Sheet data

Beginning of
period
Net Sales 18,654 Account receivable 0
COGS 0 Accounts payable 0
Inventory 0

Period: Year
Month
Quarter
Half-year
Year

Instructions – Cash Conversion Cycle


Cash Conversion Cycle is one of the core metrics, which evaluates the effectiveness of company’s invento
a company to calculate the CCC using data on its Net Sales, Cost of Goods Sold (COGS), Debtors, Creditors
period (in days) between paying creditors and receiving money from debtors. If the CCC value is positive,
debtor’s businesses; however, CCC can also be negative, in this case your suppliers are actually financing
good thing). All the data requested can be found in the company’s Balance Sheet and Profit and Loss stat

The structure:

1. Start with defining the period (Year, Half-year, Quarter or Month) for which the CCC is to be calcu
2. Fill in the necessary data:
 Column D – Net Sales and COGS data. Please fill in the cells with blue numbers in them (with
 Columns G, H – Values for the beginning/end of the given period. Please fill in the cells with d
 Cells G6&H6 – Accounts receivable. The amount of cash the company’s debtors will pay th
consideration debtors that will actually pay and do not count sales or money received for
 Cells G7&H7 – Accounts payable. The amount of cash the company will need to pay to its
account trade creditors.
 Cells G8&H8 – Inventory. The value of the company’s inventory at the beginning and end o
3. Column J –the average per period (calculated automatically). The average for accounts receivable
using data on the beginning and end of the period. The column will be calculated automatically.
4. Column K – the turnover ratio (calculated automatically). It shows the number of times the whole
payables) will be sold/collected/payed off during the chosen period of calculation. However, this
CCC is calculated.
5. Cell K11 – the CCC (calculated automatically). The CCC will be calculated using the information fro
number of days a company needs to sell its entire inventory.

Please note that this model is created on a 30/360 basis.


heet data Calculations

Average per Turnover,


End of period period days
0 0 0
0 0 0
0 0 0

CCC, days 0
Quarter
Half-year
Year

If you wish to change something


customization to your needs at a
e effectiveness of company’s inventory sales. This templa te is a tool that helps
oods Sold (COGS), Debtors, Creditors, and Inventory. The CCC shows the To order customization:
debtors. If the CCC value is positive, it means that the company is financing its  Think about changes tha
your suppliers are actually financing your business development (which is a  Send your requests and
Balance Sheet and Profit and Loss statements for a given period. andrew@agcapitalcfo.com
 We will estimate the num
template and we will sen
 Proceed to customization
onth) for which the CCC is to be calculated.
https://www.cfotemplate
services/customization-h
ells with blue numbers in them (with respect to the chosen period).
n period. Please fill in the cells with data according to the following position:
ash the company’s debtors will pay them. Note: we are only taking into
not count sales or money received for goods.
h the company will need to pay to its creditors. Note: we are only taking into

inventory at the beginning and end of the given period.


. The average for accounts receivable/payable and inventory will be calculated
mn will be calculated automatically.
shows the number of times the whole amount of inventory/receivables/
period of calculation. However, this metric is not quite intuitive, therefore the

e calculated using the information from column K. In effect, it stands for the
©Andrew Grigolyunovich, CFA

AG Capital
www.cfotemplates.com

wish to change something in this template, just order


mization to your needs at andrew@agcapitalcfo.com

der customization:
Think about changes that need to be made to your new template;
Send your requests and other comments to
andrew@agcapitalcfo.com
We will estimate the number of hours needed to customize your
template and we will send you a price quote.
Proceed to customization link at
https://www.cfotemplates.com/services/customization-
services/customization-hours/
Month Quarter
Quarter Half-year
Half-year Year
Year

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy