Working Capital

The capital required for the company to run its day to day operations. The funds invested in current assets are termed as working capital. It is the fund that is needed to run the day-to-day operations. Generally, working capital refers to the current assets of a company that is changed from one form to another in the ordinary course of business, i.e. from cash to inventory, inventory to work in progress (WIP), WIP to finished goods, finished goods to receivables and from receivables to cash.

The basic calculation of the working capital is:

Working Capital=Current Assets - Current Liabilities

Required Documents for Working Capital:- (All copies of documents should be self attested by the customer)

Nature of the business

Size of the business

Production policy

Seasonal variations

Production cycle process

Working capital cycle

Process for working capital:

Working Capital Plan

Working capital Performances

Reviewing the Working Capital Plan

Improving the Working Capital Plan