Definition:

Other Receivables refer to amounts owed to a company that are not classified under accounts receivable. These can include various types of non-trade receivables such as interest receivable, tax refunds, insurance claims, and advances to employees.

Examples

Examples of Other Receivables include interest earned but not yet received, tax refunds due from the government, insurance claims filed but not yet settled, and loans or advances given to employees that are expected to be repaid.

Formula:

There is no specific formula for Other Receivables as it is a category of receivables that encompasses various non-trade receivables.

How to use the metric:

Other Receivables are used to assess the total amount of money owed to a company from non-trade sources. This metric helps in understanding the liquidity position and financial health of a company by providing insight into potential future cash inflows.

Limitations:

One limitation of Other Receivables is that they may not be as easily collectible as trade receivables, leading to potential liquidity issues. Additionally, they can be diverse and irregular, making it difficult to predict future cash flows accurately.

Applies to:

Other Receivables apply to all industries, as most businesses will have some form of non-trade receivables, such as interest income or tax refunds.

Doesn't apply to:

There are no specific industries where Other Receivables do not apply, but industries with minimal non-trade transactions may find this metric less significant.

Summary:

Other Receivables are a category of receivables that include non-trade amounts owed to a company. They provide insight into potential future cash inflows but can be less predictable and harder to collect than trade receivables. This metric is applicable across various industries, although its significance may vary depending on the nature and volume of non-trade transactions.