06-10-2010, 08:22 PM
"The timing of cash flow within payback period" refers that payback doesn't distinguish if £1 is received on the first day or the last day of the "calculated" payback period.
Since £1 on Day 1 or £1 on Day 360 within a 1 year payback period are the same.
The mentioned disadvantage isn't related to calculating payback itself (as my query is) but to the cash flows that occur within the payback period.
