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| ''Financial ratio analysis - liquidity ratios.''
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| Current assets / Current liabilities.
| | Group Treasurer. |
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| The current ratio gives a very rough indication of the liquidity (or solvency) of the reporting entity.
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| If the current ratio were to fall below 1.0, this would indicate that the entity would not be able to meet its current liabilities out of its cash in hand and the proceeds of its other current assets.
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| | Group Treasury. |
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| '''Example'''
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| Current assets = £5m.
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| Current liabilities = £4m.
| | Grant Thornton. |
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| The current ratio is:
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| = 5 / 4
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| = 1.25.
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| == See also == | | == See also == |
| * [[Balance sheet ratio]] | | * [[Corporate treasurer]] |
| * [[Current assets]] | | * [[Group]] |
| * [[Current liabilities]] | | * [[Treasury]] |
| * [[Liquidity]]
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| * [[Liquidity ratio]]
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| * [[Quick ratio]]
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| * [[Ratio analysis]]
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| [[Category:Accounting,_tax_and_regulation]] | | [[Category:Treasury_operations_infrastructure]] |
| [[Category:The_business_context]]
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| [[Category:Liquidity_management]]
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Revision as of 10:51, 5 June 2018
1.
Group Treasurer.
2.
Group Treasury.
3.
Grant Thornton.
See also
