Analyzing the Company's Liquidity Using the Cash Conversion Cycle (Completed)

Date: Wednesday, October 17, 2018
Instructor: David Osburn
Begin Time:  9:00am Pacific Time
10:00am Mountain Time
11:00am Central Time
12:00pm Eastern Time
CPE Credit:  2 hours for CPAs

What is the Cash Conversion Cycle? How do you calculate it? What does it really mean in regards to a company’s liquidity position?

Attend this webcast and learn how the CPA should calculate and interpret the Cash Conversion Cycle formula to see its direct impact on the company’s liquidity. Included in the formula will be an assessment of acquiring inventory, collecting account receivables efficiently, and paying the account payables in a “judicious” manner.

Additionally, the webinar will cover inventory accounting “costing methods,” financing inventory, and controlling inventory costs. The effective collection of receivables will also be reviewed including negotiating “reasonable” terms. Furthermore, the timing of paying the payables will be explored including the impact of taking “discounts.”

The concepts of the Cash Conversion Cycle will be illustrated through a case study.

Who Should Attend
CPAs, CFO/controllers, financial managers, auditors, financial analysts and practitioners who provide accounting, tax or consulting services to businesses.

Topics Covered

  • How the CPA should calculate and interpret the Cash Conversion Cycle formula
  • Assessment of acquiring inventory
  • Collecting account receivables efficiently
  • Paying the account payables in a "judicious" manner
  • Inventory accounting "costing methods"
  • Financing inventory
  • Controlling inventory costs
  • Collection of receivables
  • Negotiating "reasonable" terms
  • Timing of paying the payables
  • Illustrations of the Cash Conversion Cycle

Learning Objectives

  • Describe the Cash Conversion Cycle, how it's calculated and how it directly impacts a company's liquidity
  • Recognize inventory issues including costing methods, financing, and cost containment
  • Identify receivables and "reasonable" terms
  • Describe payables and the benefit of "discounts"
  • Recognize the Cash Conversion Cycle applied through case study


Instructional Method
Group: Internet-based

NASBA Field of Study
Accounting (2 hours)

Program Prerequisites

Advance Preparation

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