tailieunhanh - Lecture Corporate finance: A practical approach: Chapter 8 - CFA Institute

Chapter 8 working capital management is the management of the short-term investment and financing of a company. Major points covered: Understanding how to evaluate a company’s liquidity position, calculating and interpreting operating and cash conversion cycles, evaluating overall working capital effectiveness of a company and comparing it with that of other peer companies,. | Chapter 8 Working Capital Management Presenter’s name Presenter’s title dd Month yyyy 1 1. Introduction Working capital management is the management of the short-term investment and financing of a company. Goals: Adequate cash flow for operations Most productive use of resources Copyright © 2013 CFA Institute 2 Internal and External Factors that Affect Working Capital Needs Internal Factors External Factors Company size and growth rates Organizational structure Sophistication of working capital management Borrowing and investing positions/activities/capacities Banking services Interest rates New technologies and new products The economy Competitors Bottom line: There are many influences on a company’s need for working capital. LOS: Describe primary sources of liquidity and factors that influence a company’s liquidity position. Page 304 Introduction Working capital management is the management of the short-term investment and financing of a company. Cash and cash equivalents, inventory, accounts receivable, accounts payable, short-term loans, etc. The goals: Adequate cash flow for operations and the most productive use of resources. Note: Too much cash may result in the company putting too much investment in low and nonearning assets. Exhibit 8-1 Internal and External Factors that Affect Working Capital Needs Internal factors: Company size and growth rates Organizational structure Sophistication of working capital management Borrowing and investing positions/activities/capacities External factors: Banking services Interest rates New technologies and new products The economy Competitors Bottom line: There are many influences on a company’s need for working capital. 2 2. Managing and measuring Liquidity Liquidity is the ability of the company to satisfy its short-term obligations using assets that are readily converted into cash. Liquidity management is the ability of the company to generate cash when and where needed. Liquidity management requires addressing drags . | Chapter 8 Working Capital Management Presenter’s name Presenter’s title dd Month yyyy 1 1. Introduction Working capital management is the management of the short-term investment and financing of a company. Goals: Adequate cash flow for operations Most productive use of resources Copyright © 2013 CFA Institute 2 Internal and External Factors that Affect Working Capital Needs Internal Factors External Factors Company size and growth rates Organizational structure Sophistication of working capital management Borrowing and investing positions/activities/capacities Banking services Interest rates New technologies and new products The economy Competitors Bottom line: There are many influences on a company’s need for working capital. LOS: Describe primary sources of liquidity and factors that influence a company’s liquidity position. Page 304 Introduction Working capital management is the management of the short-term investment and financing of a company. Cash and cash equivalents, .

• Tài chính doanh nghiệp
• Corporate finance
• Lecture Corporate finance
• Tài chính doanh nghiệp
• Business environment
• Corporate governance
• Working capital management