Working Capital Management

2,197 views

Published on

Slides on Working capital Management
need any help or assignment solution please
0092-3219091220
noorulhadi99@yahoo.com

Published in: Economy & Finance, Business
0 Comments
2 Likes
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
2,197
On SlideShare
0
From Embeds
0
Number of Embeds
7
Actions
Shares
0
Downloads
119
Comments
0
Likes
2
Embeds 0
No embeds

No notes for slide

Working Capital Management

  1. 1. Working Capital Management Presented By: Noorulhadi Qureshi M.Com MS(Finance) (inprogress) Email : [email_address] Cell : 0092-321-9091220
  2. 2. Two concepts of Working Capital <ul><li>Gross Working Capital </li></ul><ul><ul><ul><li>Gross working capital is the total of all current assets </li></ul></ul></ul><ul><li>Net Working Capital </li></ul><ul><ul><ul><li>Net working capital is the excess of current asset over current liabilities. </li></ul></ul></ul>
  3. 3. Working Capital Management <ul><li>To be very simple, Working Capital Management is the management of current assets and current liabilities </li></ul>
  4. 4. Points to be consider by working capital manager. <ul><li>Characteristic of current assets </li></ul><ul><li>Factors influencing working capital requirements </li></ul><ul><li>Formulation of working capital policy </li></ul><ul><li>Control of working capital. </li></ul>
  5. 5. Characteristics of current Assets <ul><li>Short life span. </li></ul><ul><li>Swift transformation into other asset form </li></ul>
  6. 6. Factors influencing W.C.M <ul><li>Nature of Business </li></ul><ul><li>Seasonality of operations </li></ul><ul><li>Production policy </li></ul><ul><li>Market condition </li></ul><ul><li>Condition of supply </li></ul>
  7. 7. Formulation of Working Capital <ul><li>What should be the Ratio of current assets to sale? </li></ul><ul><li>What should be the ratio of short-term financing to long term financing </li></ul><ul><ul><li>Aggressive approach </li></ul></ul><ul><ul><ul><li>Increase Risk (investment & utilize of liquid assets) </li></ul></ul></ul><ul><ul><li>Conservative approach </li></ul></ul><ul><ul><ul><li>High Ratio of current asset. </li></ul></ul></ul>Two Approaches for Above questions
  8. 8. Control of Working Capital <ul><li>Control operating cycle of Business. </li></ul><ul><ul><li>Raw material and stores storage stage. </li></ul></ul><ul><ul><li>Working in Progress Inventory stage </li></ul></ul><ul><ul><li>Finished goods inventory stage. </li></ul></ul><ul><ul><li>Debtor collection stage. </li></ul></ul>
  9. 9. Thanks for the Attention <ul><li>The End </li></ul>

×