The Analytical Study of Working Capital Management

The concept of working capital is, perhaps, one of the most misunderstood issues in the literature of finance. The reason is that it is subject to multiple connotations. From the accountants' perspective it refers to the current assets-current liabilities differential; from the finance managers' angle it implies the total investment made in current assets; from the production managers' view it refers to the total funds that a firm needs to carry out its day-to-day operations. For definitional purposes, this book adopts, for obvious reasons, the finance managers' view of working capital. Key words:- Perspective, Investment, Operations, Definitional