Accounting · Odoo glossary

Cash Conversion Cycle

The cash conversion cycle estimates how long operating cash is tied up between paying suppliers and collecting from customers.

Definition

In general ERP practice

The cash conversion cycle estimates how long operating cash is tied up between paying suppliers and collecting from customers. Its conventional formula is inventory days plus days sales outstanding minus days payable outstanding.

In Odoo

Odoo Accounting and Inventory provide relevant receivable, payable, cost and stock data. The cited documentation does not define a single standard Cash Conversion Cycle report; calculate it using consistent periods and valuation bases, rather than combining unrelated snapshots.

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