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The success of an newlineorganization to a greater extent depends upon the effective management of working newlinecapital.It guarantees the financial soundness of the organization and therefore keeps it newlineaway from the sickness zone.
Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UK Essays.
Working capital management (WCM) refers to management of a firm’s current assets and current liabilities, which is also a primary function that support firm daily operation such as used to funds its stock, credit sales, and credit purchases.
However, the management of working capital is complex as it needs to manage a number of different components which are inter-linked to each others.
The management needs to concern on account receivables, account payables, inventories and cash, as altering one component will affect the others.
The main newlinescope of the study is to check the management of working capital (current assets and newlinecurrent liabilities) of only FMCG sector.
The study analyzed the liquidity position and newlineworking capital management of a limited sample consisting of only five companies i.e. The study of working capital is based on only newlineone tool i.e. Further the study is based on last 10 years Annual Reports newlineof the five companies taken into consideration.
The study has also examined the liquidity position of newlinethe companies.
newline The scope of the study is identified after and during the study is conducted.
One objective should not be cost of the other because both of them have their important (Raheman & Nasr, 2007). (1996) also point out this fact saying ‘firms with glowing long term prospects and healthy bottom lines do not remain solvent without good liquidity management’.
For these reason WCM should be given proper consideration.