DPO and Floating rate note: Difference between pages

From ACT Wiki
(Difference between pages)
Jump to navigationJump to search
imported>Doug Williamson
(Mend links.)
 
imported>Doug Williamson
(Add alternative name.)
 
Line 1: Line 1:
1.
(FRN).  


Days Payables Outstanding.
A bond, normally with a fixed maturity, where the interest coupon is adjusted at regular intervals reflecting the prevailing market rate (usually at a margin over LIBOR).


A working capital management ratio calculated by dividing accounts payable outstanding at the end of a time period by the average daily credit purchases for the period. 


For example: a company has an average of £50,000 of payables over a year in which the cost of goods sold was £400,000.
Sometimes known as a floating rate ''bond'', or a 'floater'.
 
The DPO is:
 
50,000 / 400,000 * 365 = 45.6 days
 
 
A higher number is generally perceived as better, but a business needs to maintain the goodwill of its suppliers and a shorter payment terms may therefore be necessary.
 
 
Also known as creditor days.
 
 
2.
 
Data Protection Officer.




== See also ==
== See also ==
* [[Accounts payable management]]
* [[Bond]]
* [[Creditors]]
* [[Capped FRN]]
* [[Days inventory outstanding]]
* [[Convertible FRN]]
* [[Days sales outstanding]]
* [[LIBOR]]
* [[General Data Protection Regulation]]
* [[Nominal bond]]
* [[Payables management]]


[[Category:Context_of_treasury]]
[[Category:Financial_products_and_markets]]
[[Category:Corporate_financial_management]]
[[Category:Cash_management]]
[[Category:Technology]]

Revision as of 19:31, 1 December 2018

(FRN).

A bond, normally with a fixed maturity, where the interest coupon is adjusted at regular intervals reflecting the prevailing market rate (usually at a margin over LIBOR).


Sometimes known as a floating rate bond, or a 'floater'.


See also

Retrieved from ‘https://wiki.treasurers.org/w/index.php?title=DPO&oldid=21573’