Float

Posted in Operations and Supply Chain Terms, Total Reads: 260
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Definition: Float

Float in project management term can be defined as the amount of time a task can be delayed without causing a delay to the succeeding task or the overall project completion. Float is used to derive at the critical path and helps to achieve the shortest path to complete a project with the most efficient use of resources. An activity on the critical path will be considered to have free float if delaying that activity will not affect the succeeding activity on the critical path.


Similarly, an activity on the critical path will be considered to have total float if delaying that activity does not cause any delay in the overall project completion. The total float can be interpreted as the total flexibility in the schedule of the project.


Float in field of banking sector can be defined as the duplicate money that is present in the system or in other words, money that can be counted twice because of certain delays in the processing of money. For example: float occurs when a bank credits money to the account as soon as the check is deposited by a customer. However, it takes some time by the payer bank to approve the check and transfer the money. Until the money is transferred, it will appear in both the accounts i.e the payer’s bank and receiver bank account.


Float in securities trading is defined as the total number of outstanding shares available for trading. In other words, total number of outstanding shares minus the closely held shares will give the float.

 

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