Available modeling methods
| Method / input | Behavior |
|---|---|
| Amount | Enter the desired balance for a supported actual or forecast period. |
| Days / DSO | Annual revenue × collection days ÷ 365, subject to available receivables. |
Balances and collections
The model reconciles opening gross receivables, revenue and closing gross receivables to customer collections. A target cannot imply collecting a negative amount: gross receivables cannot exceed opening gross receivables plus revenue. Inconsistent explicit actual balances are rejected rather than hidden in a cash plug.
Impairment and adjusted views
Supported impairment uses an amount or percentage of a receivable reference and changes the allowance. Net receivables and the non-cash expense differ from gross collection movements. A direct receivable adjustment changes working capital, not revenue. Inspect linked cash-flow effects after changing the balance.
Example
At revenue of 3,650, DSO of 30 implies 300 of receivables before constraints. Raising DSO to 40 implies 400 and consumes an additional 100 of cash when other inputs are unchanged.
Documents the current implemented behavior. Example assumptions are not market data.