Cash on hand is the cash that a business can easily access at any time after paying for its expenses. This could include assets that are easy to liquidate under 90 days. It does not cover funds that the business cannot spend or use.
Cash on hand can include actual cash, cash in bank accounts, and easy-to-liquidate assets. A company must keep a tab on how much cash on hand it should set aside, depending on factors such as business model being followed. It is ideal for a business to have cash equivalent of three to six months worth of expenses.