RESEARCH OF DIFFERENCES BETWEEN OPERATING CASH AND CASH ON BANK ACCOUNT IN SELECTED PHARMACEUTICAL COMPANIES IN THE REPUBLIC OF SERBIA

Abstract

This research analyzes EBITDA as operating cash and an indicator of the
company's earning capacity and cash on account at the end of the business year. The
study underlines the difference between EBITDA as operative cash and cash that is
really on the account at the end of the business year and shows whether there is an
interdependence between these two coefficients. The paper accepts the null hypothesis
and rejects the alternative, so it can be concluded that there are differences between
operating cash (EBITDA) and cash on the bank account at the end of the business year.
The difference between a company's annual earnings and what is on the account at the
end of the business year is clarified. Some of the relevant questions are: Are EBITDA
and cash on bank account the same? What are the differences between these two
concepts? As the answer to the first question is negative, internal and external
stakeholders cannot save time in calculating the EBITDA ratio by observing only the
account balance at the end of the business year. The second question was used for
research for a more detailed explanation of these two concepts.