When I first studied cash conversion days after reading an article in HBR, I felt like someone was trying to pull the wool over my eyes. And then, seemingly a gazillion other financial analysts fell for the sleight-of-hand math to calculate cash conversion days.
In this brief article, I’ll explain why the metric cash conversion days is misleading if not misworded. What the math reveals answers a completely different, but still important, piece of financial information than what teachers explain about this measurement.
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