• Cash and cash equivalents refers to a balance sheet item that indicates the value of a company’s assets that are cash or immediately convertible to cash.

  • Cash equivalents include bank accounts and marketable securities such as commercial paper and short-term government bonds.
  • Cash equivalents must have a maturity of no more than three months.
  • Cash equivalents must also be convertible to cash; for this reason cash equivalents often have active markets.
  • The Company has cash and cash equivalents to pay its short-term bills, as well as to maintain capital for long-term capital allocation.