Embedded Files
STEP 2: Guided Group Work - Live Static Liquidity Calculator
STEP 2: Guided Group Work - Live Static Liquidity Calculator
Open your company's 2025 Annual Report PDF, extract the 7 balance sheet items ([CA] Current Assets, [INV] Inventories, [CASH] Cash, [CL] Current Liabilities), and calculate the 6 liquidity ratios in whole percentages.
📋 WORKFLOW FOR TEAMS 1–5: Paper First, Screen Second!
Use your printed paper worksheet as a scratchpad to extract the Y2025 figures from the PDF report and calculate your ratios. Once you have written down and rounded your answers on paper (whole numbers only, no decimals!), transfer them into the interactive online form below and click Check until every box turns 100% Green! Keep your paper worksheet ready for our live classroom comparison!
Guided Exercise (Team 3 - JERÓNIMO MARTINS / BIEDRONKA): Static Financial Liquidity Ratios
Guided Exercise (Team 3 - JERÓNIMO MARTINS / BIEDRONKA): Static Financial Liquidity Ratios
Goal: Check Jerónimo Martins' (owner of Biedronka) short-term static financial liquidity (Current Ratio [CR], Quick Ratio [QR], and Cash Ratio [CashR]), understand why food retail operates on negative working capital, examine the Inventory Share [INV / CA], and calculate its long-term solvency using the Golden [E / NCA] and Silver [PC / NCA] Balance Sheet Rules.
Worked Example: Step-by-Step for 2024 (Page 78 of the PDF)
STEP 0: OBTAIN THE ANNUAL REPORT HERE
STEP 1: Extract 7 Balance Sheet Items in 2024 (in EUR million, 2024 column):
STEP 1A: Short-Term Working Capital Items (4 Items):
[CA] TOTAL CURRENT ASSETS (Page 78, middle row: Total current assets): 4,833
[INV] INVENTORIES (Page 78, under Current assets: Inventories): 1,997
[CASH] CASH AND CASH EQUIVALENTS (Page 78, under Current assets: Cash and cash equivalents): 1,823
[CL] TOTAL CURRENT LIABILITIES (Page 78, lower section: Total current liabilities): 7,916
STEP 1B: Long-Term Balance Sheet Items (3 Items):
[NCA] NON-CURRENT ASSETS (Page 78, top section: Total non-current assets): 10,462
[E] SHAREHOLDERS' EQUITY (Page 78, middle section: Total shareholders' equity): 3,253
[LTD] NON-CURRENT LIABILITIES (Page 78, lower section: Total non-current liabilities): 4,126
STEP 2: How All 6 Static Liquidity Ratios are calculated (2024 Example):
STEP 2A: 4 Short-Term Liquidity Ratios (2024):
Current Liquidity Ratio -- CR (Norm: 120% to 200%, or 1.2x to 2.0x): ([CA] / [CL]) * 100% = (4,833 / 7,916) * 100% = 61.1% -> 61% (0.61x) -> LOW (Negative Working Capital Retail Model)
Quick Liquidity Ratio / Acid-Test -- QR (Norm >= 100%, or >= 1.0x): (([CA] - [INV]) / [CL]) * 100% = ((4,833 - 1,997) / 7,916) * 100% = 35.8% -> 36% (0.36x) -> LOW (Cash retail has almost no Accounts Receivable)
Cash Liquidity Ratio -- CashR (Norm >= 20%, or >= 0.2x): ([CASH] / [CL]) * 100% = (1,823 / 7,916) * 100% = 23.0% -> 23% (0.23x) -> SAFE (>= 20%)!
Inventory Share in Current Assets -- INV / CA (%): ([INV] / [CA]) * 100% = (1,997 / 4,833) * 100% = 41.3% -> 41% (Quick Assets Share = 59% -- groceries on store shelves!).
STEP 2B: 2 Long-Term Balance Sheet Rules (2024): 5. Golden Balance Sheet Rule -- E / NCA (Norm >= 100%, or >= 1.0x): ([E] / [NCA]) * 100% = (3,253 / 10,462) * 100% = 31.1% -> 31% (0.31x) -> LOW (< 100%) (Store network is financed via IFRS 16 leases and supplier trade credit). 6. Silver Balance Sheet Rule / Maturity Matching -- PC / NCA (Norm >= 100%, where Permanent Capital [PC] = [E] + [LTD]): (([E] + [LTD]) / [NCA]) * 100% = ((3,253 + 4,126) / 10,462) * 100% = 70.5% -> 71% (0.71x) -> LOW (Retail Supplier Credit Model) (Shoppers pay cash immediately at checkout while suppliers [CL] are paid 60-90 days later).
Your Turn: Task for Team 3 (Calculate 2025 -- 13 Tasks!) Look at the 2025 column on Page 78 and complete the exact same steps for 2025 (enter whole numbers and round percentages to whole numbers, no decimals):
STEP 1A: Find the 4 Short-Term Working Capital Items for 2025 (in EUR million):
[CA] TOTAL CURRENT ASSETS (Page 78, Total current assets) = ....................
[INV] INVENTORIES (Page 78, under Current assets: Inventories) = ....................
[CASH] CASH AND CASH EQUIVALENTS (Page 78, under Current assets: Cash and cash equivalents) = ....................
[CL] TOTAL CURRENT LIABILITIES (Page 78, Total current liabilities) = ....................
STEP 1B: Find the 3 Long-Term Balance Sheet Items for 2025 (in EUR million):
[NCA] NON-CURRENT ASSETS (Page 78, Total non-current assets) = ....................
[E] SHAREHOLDERS' EQUITY (Page 78, Total shareholders' equity) = ....................
[LTD] NON-CURRENT LIABILITIES (Page 78, Total non-current liabilities) = ....................
STEP 2A: Calculate the 4 Short-Term Liquidity Ratios for 2025 (whole %, no decimals):
Current Ratio -- CR (%) = ([CA]_2025 / [CL]_2025) * 100% = .......... % (Low <120%, Optimal 120%-200%, or Over-liquid >200%?)
Quick Ratio -- QR (%) = (([CA]_2025 - [INV]_2025) / [CL]_2025) * 100% = .......... % (Pass >= 100% or Low?)
Cash Ratio -- CashR (%) = ([CASH]_2025 / [CL]_2025) * 100% = .......... % (Safe >= 20% or Low?)
Inventory Share -- INV / CA (%) = ([INV]_2025 / [CA]_2025) * 100% = .......... % (Quick Assets = 100% - #4)
STEP 2B: Calculate the 2 Long-Term Balance Sheet Rules for 2025 (whole %, no decimals): 5. Golden Balance Sheet Rule -- E / NCA (%) = ([E]_2025 / [NCA]_2025) * 100% = .......... % (Pass >= 100% or Low < 100%?) 6. Silver Balance Sheet Rule -- PC / NCA (%) = (([E]_2025 + [LTD]_2025) / [NCA]_2025) * 100% = .......... % (Pass >= 100% / Positive NWC > 0 or Low?)
Page updated
Report abuse