Calculation of the "financial cushion" for early forecasting of the state of enterprises during the epidemic

The coronavirus epidemic has had a major impact on the cash flows of businesses. Many financial analysts talk about the growing role of the solvency of enterprises and the lack of funds for operating expenses. By introducing an indicator of the presence of a "financial cushion" of enterprises, the PRC government plans to control the company's cash balance. By calculating this indicator, the company will be able to understand the prospects of its own solvency during the epidemic, take measures to prevent the rupture of the financing chains, and the regulatory authorities will be able to exercise better supervision over enterprises, which will allow them to timely warn the most affected companies and provide them with the necessary assistance.