# Cash Cycle Average Balance Basis

Check whether day ratios use comparable average balances rather than mixed opening and closing snapshots.

## Scope
Preparation and review only. No account action or professional decision.

## Inputs
Opening/closing inventory, receivables and payables; COGS/sales; period days and supplied ratio policy.

## Workflow
1. Record each numerator balance basis and denominator separately.
2. Where policy specifies a simple average, show opening-plus-closing divided by 2.
3. Keep sales for receivable days separate from COGS-based components.
4. Return basis conflicts and undefined denominators without replacing reported figures silently.

## Output contract
component | opening | closing | average_policy | average | denominator | days | basis_hold

## Fictional acceptance test
Fictional inventory opening 80, closing 120 has simple average 100. WithCOGS500 and 100 days, DIO20. Using closing 120 would give 24; label the basis difference, not an unexplained 4 day deterioration.

## Review gates
Keep original values, source IDs and version dates. Unknown facts stay held. Use qualified review for hiring, legal and accounting conclusions. No send, share, sign-in, scheduling, ledger change or payment. Fictional contract review is not a live account compatibility test.

## Method source
https://corporatefinanceinstitute.com/resources/accounting/cash-conversion-cycle/

Checked October 10, 2026. Oct10 live AIS Search Console through Oct6: marketing Copilot 37 impressions, Planable/Claude 33, Planable/ChatGPT 23, campaign brief 12, investor agent 19. Social-review/reporting topics follow these parent-query leads. Other professions follow documented workflow needs, not measured exact search intent. Site impressions are not monthly volumes; exact topic volume is unmeasured.