Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Jurgis Bekepuris who wrote (29241)	12/13/2007 11:46:16 AM
From: Paul Senior	Respond to of 78959

My understanding is nca = net current assets = total current assets minus all liabilities (both long and short term). (Some people exclude the balance sheet category 'deferred taxes' from this liability, on the assumption these are never going to be paid.) Some people search the 10k's and other reported stuff for total (future, not just current) 'pension liability' and other off balance sheet liabilities which they then add to the liability total. In Ben Graham's day, from my understanding, there weren't so many of these off-balance sheet items. Net cash -- my understanding of it -- is either defined as cash less total long term liabilities, or more commonly but less strictly as: (cash+cash equivalents+short term investments) minus long term liabilities. My understanding is that "short term liabilities" are not included in the definition of 'net cash', because, by definition, these are items expected to be paid off within a 12 month period. Perhaps to my detriment (perhaps not), I generally calculate from the balance sheet only and so I ignore off-balance sheet liability items unless someone else points out that these are or could be significant for the particular company, and so should be included in the calculations.