TAILIEUCHUNG - Lecture Corporate finance: A practical approach: Chapter 8 - CFA Institute

Chapter 8 working capital management is the management of the short-term investment and financing of a company. Major points covered: Understanding how to evaluate a company’s liquidity position, calculating and interpreting operating and cash conversion cycles, evaluating overall working capital effectiveness of a company and comparing it with that of other peer companies,. | Chapter 8 Working Capital Management Presenter’s name Presenter’s title dd Month yyyy 1 1. Introduction Working capital management is the management of the short-term investment and financing of a company. Goals: Adequate cash flow for operations Most productive use of resources Copyright © 2013 CFA Institute 2 Internal and External Factors that Affect Working Capital Needs Internal Factors External Factors Company size and growth rates Organizational structure Sophistication of working capital management Borrowing and investing positions/activities/capacities Banking services Interest rates New technologies and new products The economy Competitors Bottom line: There are many influences on a company’s need for working capital. LOS: Describe primary sources of liquidity and factors that influence a company’s liquidity position. Page 304 Introduction Working capital management is the management of the short-term investment and financing of a company. Cash and cash equivalents, inventory, accounts receivable, accounts payable, short-term loans, etc. The goals: Adequate cash flow for operations and the most productive use of resources. Note: Too much cash may result in the company putting too much investment in low and nonearning assets. Exhibit 8-1 Internal and External Factors that Affect Working Capital Needs Internal factors: Company size and growth rates Organizational structure Sophistication of working capital management Borrowing and investing positions/activities/capacities External factors: Banking services Interest rates New technologies and new products The economy Competitors Bottom line: There are many influences on a company’s need for working capital. 2 2. Managing and measuring Liquidity Liquidity is the ability of the company to satisfy its short-term obligations using assets that are readily converted into cash. Liquidity management is the ability of the company to generate cash when and where needed. Liquidity management requires addressing drags .

• Tài chính doanh nghiệp
• Corporate finance
• Lecture Corporate finance
• Tài chính doanh nghiệp
• Business environment
• Corporate governance
• Working capital management
• Intermediate corporate finance
• Lecture Intermediate corporate finance
• Corporate valuation
• Value based management
• Fundamentals of corporate finance
• Business organization
• Financial management
• International corporate finance
• Capital market history
• Raising capital
• Financial leverage
• Financial reporting
• Social welfare
• Forward contracts
• The stock markets
• Basic return concepts
• Portfolio theory
• Bond valuation
• Basic stock valuation
• Accounting for financial management
• Analysis of financial statements
• Financial planning
• Forecasting financial statements
• Capital budgeting
• Decision criteria
• Estimating cash flows
• Real options
• Capital structure decisions
• The levered firm
• Cash management
• Financial distress
• Hedging risk
• Warrants and convertibles
• Principles of corporate finance
• Understanding options
• Valuing options
• Financial analysis
• Financial manager
• Financial institutions