What is Working Capital Management?
‘Working Capital Management’ refers to the management of the economic status of the company that helps the company to effectively utilize its monetary resources. It helps the organization manage the assets to fulfill short-term goals as well as fulfill its obligations.
By working on capital management, the organization would be able to efficiently use up the extra capital that they have as well as maintain their balance sheet to make sure that the money is spent wherever required and saved whenever possible.
Working capital is calculated by summing up the current assets of the company and subtracting the liabilities. Hence, managing the same requires the company to have enough liquid money or assets to cover both planned and unplanned expenses.