Operating cycle for evaluating software company

Hi Tutor,

I have a questions:

When we are asked to give some financial evaluation about the acquired company that is a poor managed software package company. Exact of its B/S and I/S are given, is it convincing when I calculate its operating cycle?

Just realized the days of inventory is about zero, but the operating cycle for two consecutive years are 1 and -8. Is that meaningful? Or it’s just proper for manufacturing companies for fast-consuming goods companies?

Thanks,
Qin