Working capital and the operating cycle - part 4
Taught by James Griffiths · AI tutor support included
Effective working capital management requires balancing the risks of over-capitalisation and over-trading through strategic funding policies. This lesson explores permanent versus fluctuating current assets, compares conservative, aggressive, and moderate working capital funding approaches, and demonstrates how to analyse and optimise working capital policy to support sustainable business growth.
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In this lesson
- 0:00 Introduction to Working Capital Risks
- 1:12 Working Capital Policy Importance
- 2:10 Permanent vs. Fluctuating Current Assets
- 3:05 Working Capital Funding Policies
- 4:58 Analysing Working Capital with an Example
- 6:44 Recap and Conclusion
About this lesson
Unlock the key to managing your company's finances effectively with our latest video on working capital and the operating cycle. Learn how to strike the perfect balance between over capitalisation and over trading, and explore the risks and strategies associated with each. Discover the advantages of conservative, aggressive, and moderate approaches to funding working capital, and find out which strategy aligns best with your risk tolerance. This video is a must-watch for business professionals aiming to optimise their working capital policy for sustainable growth.
Duration: 7m
- Over-capitalisation and over-trading risks
- Permanent and fluctuating current assets
- Conservative working capital funding policy
- Aggressive working capital funding policy
- Moderate working capital funding policy
- Working capital policy analysis and optimisation
Transcript
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