HC Deb 13 March 1978 vol 946 cc12-3W
Mr. Woof

asked the Secretary of State for Trade what has been the level, respectively, of cash and Government securities, and of current liabilities held by companies operating mainly in the United Kingdom since 1971 to the latest available date; and what has therefore been their liquidity ratio for each of these years.

Mr. Clinton Davis

The available figures, which relate to large listed and, except for 1976, unlisted companies engaged mainly in the United Kingdom

Year(a) … … Number of companies(b) Cash etc.(c) £ million British Government Securities(d) £ million Total current liabilities(e) £ million Liquidity ratio(f) Per cent.
1971 final … … 1,851 1,833 14 17,153 10.8
1971 comparable to … … 1,825 1,829 14 17,093 10.8
1972 final … … 1,754 2,797 8 19,447 14.4
1972 comparable to … … 1,734 2,788 8 19,319 14.5
1973 final … … 1,691 3,510 18 25,354 13.9
1973 comparable to … … 1,665 3,476 18 24,883 14.0
1974 final … … 1,649 3,053 26 30,491 10.1
1974 comparable to … … 1,527 3,024 24 30,420 10.0
1975 final … … 1,513 3,987 32 32,550 12.3
1975 comparable to … … 821 3,069 29 23,498 13.2
1976 provisional (g) … … 802 4,250 97 28,371 15.3

Sources: Business Monitor, M3—Company Finance (published annually):

  • 1971—Table 3 of Fifth Issue;
  • 1972 to 1974—Table 1 of Sixth, Seventh and Eighth Issues;
  • 1975 and 1976—Tables 1 and 2 of Ninth Issue (to be published shortly).

Notes:

  1. (a) The figures for any one year, shown as a calendar year, cover figures for companies' accounting periods ending between 6th April of the year shown and 5th April of the following year.
  2. (b) The number of large companies covered by the analysis (as published in Business Monitor M3) decreases from year-to-year because of acquisitions, mergers, liquidations or nationalisation. For this reason two figures for each year are shown. The large fall in the number of companies between 1974 and 1975 followed the raising of the size criteria that determine which companies are included.
  3. (c) Cash etc. = cash, bank and similar balances plus United Kingdom Treasury Bills.
  4. (d) British Government securities, in so far as they can be identified in companies' accounts.
  5. (e) Total current liabilities = Bank overdrafts and loans plus short-term loans plus trade and other creditors plus dividends and interest due plus current taxation.
  6. (f) Liquidity ratio = Cash etc. plus Government securities as a proportion of total current liabilities.
  7. (g) Relates to large listed companies only.

Further details of assets and liabilities can be obtained from Business Monitor M3—Company Finance, including figures for a liquidity ratio defined as the ratio of immediate assets—total current assets less stocks and work-in-progress—to total current liabilities.

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