Working capital management is concerned with making sure we have exactly the right amount of money and lines of credit available to the business at all times. In part 1 of our look at working capital management we will look at the liquidity ratios. Cash is the life-blood of any business, no matter how large or small. If a business has no cash and no way of getting any cash, it will have to close down. It's that simple! Following on from this we can see that if a business has no idea of its liquidity and working capital position, it could be in serious trouble.
- Ratio Analysis 3: Working Capital Management 1: Liquidity
Source:
http://www.bized.co.uk/
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