Headroom target

From ACT Wiki
Revision as of 14:22, 21 November 2012 by Doug Williamson (Talk | contribs) (Extracted from "Headroom" page.)

(diff) ← Older revision | Latest revision (diff) | Newer revision → (diff)
Jump to: navigation, search

Total sources of liquidity need to be sufficient to meet the cash needs of an organisation, taking into account any uncertainty over future cash requirements.

For this reason a headroom target should be set to provide flexibility and to ensure the Directors are able to certify their company as being a Going Concern (under IFRS accounting guidelines) at the end of each financial reporting period.