Working Capital Management
Working with
Working Capital Management
Multi-Line Industry
Conglomerates Family Firms
In GCC Countries
Abstract:
An efficient Working Capital Management (WCM) has a significant effect toward the creation of a firm’s value. It is a fact that financial managers in the firms used to give concentration on managing long-term financial decisions, specially capital structure, investment decisions, company valuation & dividends decisions. Only little attention was given to managing the short-term assets and liabilities, managers began to realize the importance of investigating those short-term assets and liabilities since the working capital management has an important role for the firm’s profitability & risk and the overall value of the firm.
There is no doubt about the criticality of this issue to firms as holding too much working capital is inefficient and holding too little is dangerous to the organization 's survival. This study looks at some firms in multi-line industry in GCC country focusing on family owned conglomerates firms, to investigate their methods of managing their working capital and identifies how organizations creates balance in their working capital..
Introduction:
Working capital, also known as net working capital, is a financial metric which represents operating liquidity available to a business. Along with fixed assets such as plant and equipment, working capital is considered a part of operating capital. It is calculated as current assets minus current liabilities. If current assets are less than current liabilities, an entity has a working capital deficiency, also called a working capital deficit. Working capital management is simple and a straightforward concept of ensuring the ability of the organization to fund the difference between the short-term assets and short-term liabilities (Harris 2005). Currently, working capital management became an important issue to all firms; overall, it can minimize companies’ risks and
Working Capital Management
Multi-Line Industry
Conglomerates Family Firms
In GCC Countries
Abstract:
An efficient Working Capital Management (WCM) has a significant effect toward the creation of a firm’s value. It is a fact that financial managers in the firms used to give concentration on managing long-term financial decisions, specially capital structure, investment decisions, company valuation & dividends decisions. Only little attention was given to managing the short-term assets and liabilities, managers began to realize the importance of investigating those short-term assets and liabilities since the working capital management has an important role for the firm’s profitability & risk and the overall value of the firm.
There is no doubt about the criticality of this issue to firms as holding too much working capital is inefficient and holding too little is dangerous to the organization 's survival. This study looks at some firms in multi-line industry in GCC country focusing on family owned conglomerates firms, to investigate their methods of managing their working capital and identifies how organizations creates balance in their working capital..
Introduction:
Working capital, also known as net working capital, is a financial metric which represents operating liquidity available to a business. Along with fixed assets such as plant and equipment, working capital is considered a part of operating capital. It is calculated as current assets minus current liabilities. If current assets are less than current liabilities, an entity has a working capital deficiency, also called a working capital deficit. Working capital management is simple and a straightforward concept of ensuring the ability of the organization to fund the difference between the short-term assets and short-term liabilities (Harris 2005). Currently, working capital management became an important issue to all firms; overall, it can minimize companies’ risks and
References: http://blog.receivablesxchange.com/blog/?Tag=credit+crisis http://en.wikipedia.org/wiki/Working_capital www.studyfinance.com/lessons/workcap http://spears.okstate.edu/home/frankpd/legacy/fin3113/Ch16.pdf http://management.ut.ac.ir/fa/hozeh/teachers/MirLohi/ch08.ppt#258,3,Working Capital Concepts http://www.bizresearchpapers.com/Kesseven.pdf http://www.american.edu/TED/SAUDI.HTM