Big data and Quick ratio: Difference between pages

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Big data refers to the large volumes of historically unstructured information held by organisations.
''Financial ratio analysis - liquidity ratios.''


(Current assets <i>less</i> Inventories) / Current liabilities.


Big data technology interrogates this previously unstructured information to produce more useful summarised and selected data and analysis.
The quick ratio gives a very rough indication of the liquidity (or solvency) of the reporting entity.<br />
If the quick 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 (excluding inventories).


For example, anti-fraud technology in banks can analyse how often bank customers log into their account, where they usually log in from, and how quickly they type in their user name and password.
 
<b>Example</b><br />
Current assets (excluding inventories) = £3m. <br />
Current liabilities = £4m. <br />
 
The Quick ratio is: <br />
= 3 / 4 <br />
= 0.75.
 
 
The quick ratio is also known as the Acid test or the Acid test ratio.<br />
Inventories are sometimes also known as Stock.




== See also ==
== See also ==
*[[General Data Protection Regulation]]
* [[Balance sheet ratio]]
*[[Operational risk]]
* [[Current assets]]
* [[Current liabilities]]
* [[Current ratio]]
* [[Inventory]]
* [[Liquidity]]
* [[Liquidity ratio]]
* [[Stock]]


[[Category:Compliance_and_audit]]
[[Category:Accounting,_tax_and_regulation]]
[[Category:Manage_risks]]
[[Category:The_business_context]]
[[Category:Risk_frameworks]]
[[Category:Liquidity_management]]
[[Category:Technology]]

Latest revision as of 19:09, 3 February 2019

Financial ratio analysis - liquidity ratios.

(Current assets less Inventories) / Current liabilities.

The quick ratio gives a very rough indication of the liquidity (or solvency) of the reporting entity.
If the quick 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 (excluding inventories).


Example
Current assets (excluding inventories) = £3m.
Current liabilities = £4m.

The Quick ratio is:
= 3 / 4
= 0.75.


The quick ratio is also known as the Acid test or the Acid test ratio.
Inventories are sometimes also known as Stock.


See also