Publication Date


Document Type


First Advisor

Weiss, Donald E.

Degree Name

B.S. (Bachelor of Science)

Legacy Department

Department of Finance


Working Capital management is an important aspect of financial management in most firms. Working Capital is the sum of current assets in a firm which provide profitability and liquidity to a firm. Profitability ensures that funds are employed efficiently to generate a maximum rate of return. Liquidity enables the firm to satisfy its financial obligations and avoid bankruptcy. The major current assets which comprise working capital are cash, marketable securities, accounts receivable, and inventory. The current liabilities that detract from working capital are accounts payable, accruals and short-term borrowing. A survey was sent to 65 financial executives to determine the current trends in implementing working capital techniques. Each respondent was asked to supply information about his/her company's annual revenues, industry, cash management policies, marketable securities investments, accounts receivable control, inventor, management and short-term borrowing. Many interesting observations were made based on the data collected from the surveys. Among these observations are the following: The most important features of a cash management system are cost, improvement in float, ease in implementation and consistency of results; the most important characteristics of marketable securities are safety, yield, maturity and marketability; most firms devote a lot of effort to control accounts receivable and reduce delinquent accounts; and the majority of companies feel that a good relationship with a commercial lender is important in obtaining short-term funds. The most important observation was that all companies use working capital management.


viii, 35 pages




Northern Illinois University

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