Cash
Cash comprises cash on hand and demand deposits. It includes notes and coins held by the business and bank deposits available on demand. Cash is an asset unless a bank balance represents an overdraft. In the cash flow statement, cash is considered together with qualifying cash equivalents, and certain repayable-on-demand overdrafts may form part of cash management.
Worked example
A till contains $400 and an ordinary bank current account holds $6,000: both are cash assets.
Common mistake
A credit sale is revenue but creates a receivable rather than cash; an unused borrowing facility is not cash either.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | F1 | Direct | July 2027–August 2028 |
| ACCA | F3 | Supporting | July 2027–August 2028 |
| ACCA | FA | Direct | September 2026–June 2027 |
| ACCA | K1 | Direct | July 2027–August 2028 |
| FIA | FFA | Direct | September 2026–June 2027 |