Module VI· Revolver & Cash Plug MechanicsIntermediate
Question

What is minimum cash balance, and how do you integrate it?

Answer

Minimum cash is the operating cash balance the business needs to run. In the model, ending cash should not fall below this level unless there is a deliberate breach case. Cash available for debt repayment is cash above minimum cash. If cash before financing is below minimum, the revolver draws or other funding is needed.