It’s critical to manage the company’s working capital as cash generated from the working capital cycle is not synonymous with profit generated from the business. Without adequate cash/liquidity, profitable companies can not survived as they need to pay their liabilities from cash and not from profit.
Some examination questions test the candidates on the understanding, objective and how to optimize the working capital as this is one way to do value-adding to the organization.
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Part |
Useful Information |
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1 |
Introduction & Reasons/Objectives of Working Capital Management |
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2 |
Optimizing Working Capital by Managing Debtors |
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3 |
Optimizing Working Capital by Managing Stocks |
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4 |
Optimizing Working Capital by Managing Accounts Payable |
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5 |
Further Reading on Cash Operating Cycle Article 1; Article 2 |
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6 |
Cash Management Article on The Importance of Cash flows Article on Improving Cash flows |
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