Cash ratio (Absolute liquidity ratio) is one of liquidity indicators which informs us about how many times the firm would be able to pay its current liabilities, if it converts its financial assets to cash.
The indicator has only the most liquid component in the numerator - (short-term) financial assets comprising of cash, bank accounts and possibly short-term investments (short-term securities).
Recommended value: the ideal value is around 0,2 - 0,5.
Their general interpretation: