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Prepared byPrepared byKen HartviksenKen Hartviksen
INTRODUCTION TOINTRODUCTION TO
CORPORATE FINANCECORPORATE FINANCELaurence BoothLaurence Booth •• W. Sean ClearyW. Sean Cleary
Chapter 24 – Working CapitalChapter 24 – Working CapitalManagement: Current Assets an CurrentManagement: Current Assets an CurrentLia!ilitiesLia!ilities
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CHAPTER 24CHAPTER 24
Working Capital Management:Working Capital Management:Current Assets and CurrentCurrent Assets and Current
LiabilitiesLiabilities
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!e$tre Agenda!e$tre Agenda
• Learning ObjectivesLearning Objectives• Important TermsImportant Terms• Cash ManagementCash Management
– Reasons %or Holding Cas&Reasons %or Holding Cas& – 'etermining t&e (ptimal Cas& )alan$e'etermining t&e (ptimal Cas& )alan$e – Cas& Management Te$&ni*esCas& Management Te$&ni*es
• Accounts Receivable ManagementAccounts Receivable Management – T&e Credit 'e$isionT&e Credit 'e$ision – Credit Poli$iesCredit Poli$ies – T&e Colle$tion Pro$essT&e Colle$tion Pro$ess
• Inventory ManagementInventory Management
– +nventory Management Approa$&es+nventory Management Approa$&es – Evalating +nventory ManagementEvalating +nventory Management
• Short-Term Financing ConsierationsShort-Term Financing Consierations• Summary an ConclusionsSummary an Conclusions
– Con$ept Revie, -estionsCon$ept Revie, -estions
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!earning (b.e$tives!earning (b.e$tives
!ou shoul unerstan the "ollo#ing$ !ou shoul unerstan the "ollo#ing$• %o# to manage iniviual asset items& such as cash&%o# to manage iniviual asset items& such as cash&
receivables& an inventoryreceivables& an inventory
• The nature o" the major sources o" short-term 'nancing& The nature o" the major sources o" short-term 'nancing&such as trae creit& ban( loans& "actoring arrangements&such as trae creit& ban( loans& "actoring arrangements&
an money mar(et securitiesan money mar(et securities
• The "act that in evaluating current asset an current The "act that in evaluating current asset an current
liability ecisions& the 'nal ecision rests on the stanarliability ecisions& the 'nal ecision rests on the stanar
problem o" traing o) e*pecte bene'ts an potentialproblem o" traing o) e*pecte bene'ts an potentialcostscosts
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+mportant C&apter Terms+mportant C&apter Terms
• A+C approachA+C approach
• CapacityCapacity
• CharacterCharacter
• ConitionsConitions
• Creit analysisCreit analysis• Creit enhancementsCreit enhancements
• ,conomic Orer uantity,conomic Orer uantity
• Factoring arrangementsFactoring arrangements
•Finance motiveFinance motive
• FloatFloat
• .ust-in-time inventory .ust-in-time inventorysystemssystems
• Materials re/uirementMaterials re/uirementplanningplanning
• Open accountOpen account• Optimal cash balanceOptimal cash balance• 0recautionary motive0recautionary motive• 0repayments0repayments• Securiti1ationSecuriti1ation• Special purpose vehiclesSpecial purpose vehicles• Speculative motiveSpeculative motive• Terms o" creit Terms o" creit
• Transactions motive Transactions motive
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Cas& and Marketable 0e$ritiesCas& and Marketable 0e$rities
2or(ing Capital Management2or(ing Capital Management
Current Assets an Current LiabilitiesCurrent Assets an Current Liabilities
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Cas& and Marketable 0e$ritiesCas& and Marketable 0e$ritiesReasons %or Holding Cas&Reasons %or Holding Cas&
3434 Transactions motive Transactions motive
5454 0recautionary motive0recautionary motive
6464 Finance motiveFinance motive
7474 Speculative motiveSpeculative motive
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Cas& and Marketable 0e$ritiesCas& and Marketable 0e$rities'etermining t&e (ptimal Cas& )alan$e'etermining t&e (ptimal Cas& )alan$e
• The optimal cash balance is the amount o" The optimal cash balance is the amount o"
cash that balances the ris(s o" illi/uiitycash that balances the ris(s o" illi/uiity
against the sacri'ce in e*pecte return that isagainst the sacri'ce in e*pecte return that is
associate #ith maintaining cash4associate #ith maintaining cash4
– 'i%%ers sbstantially a$ross %irms'i%%ers sbstantially a$ross %irms3 irms ,it& predi$table $as& %lo,s ,ill &ave lo,er optimalirms ,it& predi$table $as& %lo,s ,ill &ave lo,er optimal
$as& balan$e re*irement$as& balan$e re*irement
3 irms ,it& e5$ess borro,ing $apa$ity 6nsed line o% $reditirms ,it& e5$ess borro,ing $apa$ity 6nsed line o% $redit%or e5ample7 $an &old less $as&8%or e5ample7 $an &old less $as&8
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Cas& and Marketable 0e$ritiesCas& and Marketable 0e$ritiesCas& Management Te$&ni*esCas& Management Te$&ni*es
• Cash 8o# synchroni1ation can "ree up cash 9an lo#erCash 8o# synchroni1ation can "ree up cash 9an lo#erthe amount o" capital a 'rm re/uires:the amount o" capital a 'rm re/uires:
• This is one by$ This is one by$
– 0peeding p $as& in%lo,s:0peeding p $as& in%lo,s:3 )ill $lients earlier ea$& mont&)ill $lients earlier ea$& mont&
3 +n$rease $as& sales t&rog& in$entives+n$rease $as& sales t&rog& in$entives
3 En$orage $stomers to pay sing ele$troni$ payments systemsEn$orage $stomers to pay sing ele$troni$ payments systemss$& as dire$t deposit; atomati$ debit; debit $ard; rat&er t&ans$& as dire$t deposit; atomati$ debit; debit $ard; rat&er t&an$&e*e8$&e*e8
– 'elaying ot%lo,s:'elaying ot%lo,s:3 Arrange ,it& sppliers %or more liberal trade $redit terms 6net 4
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Cas& ManagementsCas& Managementsloatloat
• Float is the time that elapses bet#een the time theFloat is the time that elapses bet#een the time thepaying 'rm initiates payment& an the time the "unspaying 'rm initiates payment& an the time the "unsare available "or use by the receiving 'rm4are available "or use by the receiving 'rm4
• It has three major sources$It has three major sources$
=8=8 T&e time it takes t&e $&e*e to rea$& t&e %irm a%ter it is mailed byT&e time it takes t&e $&e*e to rea$& t&e %irm a%ter it is mailed byt&e $stomer8t&e $stomer8
2828 T&e time it takes t&e re$eiving %irm to pro$ess t&e $&e*e andT&e time it takes t&e re$eiving %irm to pro$ess t&e $&e*e anddeposit in an a$$ont; anddeposit in an a$$ont; and
#8#8 T&e time it takes t&e $&e*e to $lear t&rog& t&e banking systemT&e time it takes t&e $&e*e to $lear t&rog& t&e banking systemso t&at t&e %nds are available to t&e %irm8so t&at t&e %nds are available to t&e %irm8
•
Float has been reuce or eliminate through$Float has been reuce or eliminate through$ – 'ebit $ards'ebit $ards – Preat&ori>ed paymentsPreat&ori>ed payments – Ele$troni$ %nds trans%er 6ET7 and ele$troni$ data inter$&angeEle$troni$ %nds trans%er 6ET7 and ele$troni$ data inter$&ange
6E'+7 systems86E'+7 systems8
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A$$onts Re$eivable A$$onts Re$eivable
2or(ing Capital Management2or(ing Capital Management
Current Assets an Current LiabilitiesCurrent Assets an Current Liabilities
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A$$onts Re$eivable A$$onts Re$eivable
3434 The ecision to e*ten creit to customers has The ecision to e*ten creit to customers has
signi'cant cash 8o# an creit ris( implications "orsigni'cant cash 8o# an creit ris( implications "or
the 'rm4the 'rm43 irms o%ten don?t &ave a $&oi$e; i% t&e availability o% $redit is anirms o%ten don?t &ave a $&oi$e; i% t&e availability o% $redit is an
important %a$tor in t&e $stomer?s pr$&ase de$ision pro$ess 6i%important %a$tor in t&e $stomer?s pr$&ase de$ision pro$ess 6i%$ompetitors o%%er $redit; t&en t&e %irm mst at least mat$& t&ose$ompetitors o%%er $redit; t&en t&e %irm mst at least mat$& t&ose
$redit terms; and t&en $&oose to $ompete on anot&er basis87$redit terms; and t&en $&oose to $ompete on anot&er basis87
5454 The secon ecision 9once the 'rm has ecie to The secon ecision 9once the 'rm has ecie to
e*ten creit: is to etermine #hich customers #ille*ten creit: is to etermine #hich customers #ill
be grante creit4be grante creit46464 The creit terms must be establishe4 The creit terms must be establishe4
7474 The collection process must be ecie4 The collection process must be ecie4
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A$$onts Re$eivable A$$onts Re$eivableT&e Credit 'e$isionT&e Credit 'e$ision
• The ecision to e*ten creit is etermine$ The ecision to e*ten creit is etermine$
– @atre o% t&e prod$t sold;@atre o% t&e prod$t sold;
–T&e indstryT&e indstry – Pra$ti$es o% $ompetitors8Pra$ti$es o% $ompetitors8
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A$$onts Re$eivable A$$onts Re$eivableCredit AnalysisCredit Analysis
• The process esigne to assess the ris( o" non- The process esigne to assess the ris( o" non-
payment by potential customers& #hich involvespayment by potential customers& #hich involves
collecting in"ormation about potential customers #ithcollecting in"ormation about potential customers #ith
respect to their creit history& their ability to ma(erespect to their creit history& their ability to ma(e
payments as re8ecte in their e*pecte cash 8o#s&payments as re8ecte in their e*pecte cash 8o#s&an their overall 'nancial stability4an their overall 'nancial stability4
• From the 'rm;s point o" vie#$From the 'rm;s point o" vie#$
– (%ten ,illing to e5tend $redit on terms better t&an a bank(%ten ,illing to e5tend $redit on terms better t&an a bank
be$ase:be$ase:3 T&e potential %or t&e %irm developing a good $stomer into t&eT&e potential %or t&e %irm developing a good $stomer into t&e
%tre; and%tre; and
3 !osses are limited to prod$tion $osts in t&e $ase o% de%alt8!osses are limited to prod$tion $osts in t&e $ase o% de%alt8
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A$$onts Re$eivable A$$onts Re$eivableCredit AnalysisCredit Analysis
ed to satis%y
paymentpayment
– Conditions – t&e state o% t&e e$onomy8Conditions – t&e state o% t&e e$onomy8
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A$$onts Re$eivable A$$onts Re$eivableCredit Poli$iesCredit Poli$ies
• The 'rm must choose #hat terms o" creit to The 'rm must choose #hat terms o" creit too)er its customers4o)er its customers4
• Terms o" creit inclue$ Terms o" creit inclue$
– T&e de dateT&e de date – T&e dis$ont amont 6i% any7T&e dis$ont amont 6i% any7
• Options inclue$Options inclue$ – Cas& on delivery 6C('7Cas& on delivery 6C('7
– Cas& be%ore delivery 6C)'7Cas& be%ore delivery 6C)'7 – @et #
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A$$onts Re$eivable A$$onts Re$eivableC&ange in Credit Poli$y AnalysisC&ange in Credit Poli$y Analysis
• 2hen e*tening more lenient creit terms the 'rm hopes to2hen e*tening more lenient creit terms the 'rm hopes to
increase revenues through the sale o" more units& anincrease revenues through the sale o" more units& an
perhaps even charge higher prices4perhaps even charge higher prices4
•
These bene'ts are o)set by 'nancing costs an the These bene'ts are o)set by 'nancing costs an theincrease ris( o" non-payment4increase ris( o" non-payment4
• ,valuation o" these ecisions can use an =0< "rame#or($,valuation o" these ecisions can use an =0< "rame#or($
C"#C"s$%&'"uture (%& )=[ 24!"
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A$$onts Re$eivable A$$onts Re$eivableT&e Colle$tion Pro$essT&e Colle$tion Pro$ess
• The 'rm must monitor outstaning A>R by customer The 'rm must monitor outstaning A>R by customeran by category4an by category4
• The 'rm must then etermine #hat action it #ill ta(e The 'rm must then etermine #hat action it #ill ta(e#hen late payments occur4#hen late payments occur4
– C&arge interest on otstanding balan$esC&arge interest on otstanding balan$es – @oti%y $stomer o% arrears 6email; mail; telep&one7@oti%y $stomer o% arrears 6email; mail; telep&one7
• Actions on unpai amounts$Actions on unpai amounts$ – Allo, no %rt&er pr$&ases on $redit Allo, no %rt&er pr$&ases on $redit
– C&oose %rom a nmber o% additional options to $olle$t:C&oose %rom a nmber o% additional options to $olle$t:
=8=8 Take legal a$tionTake legal a$tion
2828 0ell re$eivable to a $olle$tion agen$y0ell re$eivable to a $olle$tion agen$y
#8#8 Write o%% t&e debt as n$olle$table8Write o%% t&e debt as n$olle$table8
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A$$onts Re$eivable A$$onts Re$eivablea$toringa$toring
It may not be cost-e)ective "or a 'rm toIt may not be cost-e)ective "or a 'rm to
manage the collection process itsel"4manage the collection process itsel"4
Factoring arrangements are the sale o" aFactoring arrangements are the sale o" a'rm;s receivables& at a iscount& to a'rm;s receivables& at a iscount& to a
'nancial company calle a "actor& #hich'nancial company calle a "actor& #hich
speciali1es in collections& or the out-sourcingspeciali1es in collections& or the out-sourcing
o" the collections to a "actor4o" the collections to a "actor4
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Evalating Re$eivables ManagementEvalating Re$eivables Management
• ?se o" prouctivity ratios introuce in?se o" prouctivity ratios introuce in
Chapter 7 can give a tool "or evaluating theChapter 7 can give a tool "or evaluating the
'rm;s ability to manage its accounts'rm;s ability to manage its accountsreceivable4receivable4
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Evalating Re$eivables ManagementEvalating Re$eivables ManagementRe$eivables Trnover Re$eivables Trnover
• Measures the sales generate by every ollarMeasures the sales generate by every ollar
o" receivables4o" receivables4
*ecei+a!leAccounts
Sales
turno+ers*ecei+a!le
=
=
RT
AR
S
[4 !#"
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Evalating Re$eivables ManagementEvalating Re$eivables Management Average Colle$tion Period Average Colle$tion Period
• ,stimates the number o" ays it ta(es a 'rm to collect on,stimates the number o" ays it ta(es a 'rm to collect onits accounts receivable4its accounts receivable4
• I" AC0 is 7@ ays& an the 'rm;s creit policy is net 6@&I" AC0 is 7@ ays& an the 'rm;s creit policy is net 6@&clearly& customers are not paying in (eeping #ith the 'rm;sclearly& customers are not paying in (eeping #ith the 'rm;spolicy& an there may be concerns about the /uality o" thepolicy& an there may be concerns about the /uality o" the'rm;s customers& an #hat might happen i" economic'rm;s customers& an #hat might happen i" economicconitions eteriorate4conitions eteriorate4
turno+er s*ecei+a!le
A*
,urno+er s*ecei+a!le
-/ %erioCollectionA+erage
=
==
ACP
ADS
AR
[4 !$"
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+nventory+nventory
2or(ing Capital Management2or(ing Capital Management
Current Assets an Current LiabilitiesCurrent Assets an Current Liabilities
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+nventory+nventory
• The level o" inventory a 'rm hols is a trae o) The level o" inventory a 'rm hols is a trae o)bet#een bene'ts an costs$bet#een bene'ts an costs$
)ene%its o% Holding +nventory:)ene%its o% Holding +nventory:
3 Take advantage o% large"volme dis$ontsTake advantage o% large"volme dis$onts3 Red$e t&e probability o% prod$tion disrptions be$ase o% la$k o%Red$e t&e probability o% prod$tion disrptions be$ase o% la$k o%
inventoryinventory
3 Minimi>e lost sales be$ase o% sto$k"otsMinimi>e lost sales be$ase o% sto$k"ots
Costs o% Holding +nventory:Costs o% Holding +nventory:
3 inan$ing $osts asso$iated ,it& inventory investmentinan$ing $osts asso$iated ,it& inventory investment3 0torage; &andling; insran$e; spoilage and obsoles$en$e $osts80torage; &andling; insran$e; spoilage and obsoles$en$e $osts8
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+nventory+nventory+nventory Management Approa$&es+nventory Management Approa$&es
• A+C ApproachA+C Approach
• ,conomic Orer uantity 9,O: Moel,conomic Orer uantity 9,O: Moel
•
Materials Re/uirement 0lanning 9MR0:Materials Re/uirement 0lanning 9MR0:• .ust-in-time 9.IT: Inventory systems4 .ust-in-time 9.IT: Inventory systems4
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+nventory+nventoryEvalating +nventory ManagementEvalating +nventory Management
• ?se o" 'nancial ratios can give some?se o" 'nancial ratios can give some
inication o" the e)ectiveness o" a 'rm;sinication o" the e)ectiveness o" a 'rm;s
inventory management4inventory management4
• Ratios& ho#ever& o not measure shortageRatios& ho#ever& o not measure shortage
costs& 'nancing costs& etc4costs& 'nancing costs& etc4
• These ratios inclue$ These ratios inclue$
– +nventory trnover +nventory trnover – Average day?s sales in inventory8 Average day?s sales in inventory8
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Prod$tivity RatiosProd$tivity Ratios+nventory Trnover +nventory Trnover
• ,stimates the number o" times& ening inventory #as,stimates the number o" times& ening inventory #asturne over; 9sol: in the year4turne over; 9sol: in the year4
• A ratio that involves both stoc(; an 8o#; valuesA ratio that involves both stoc(; an 8o#; values
• Is strongly a "unction o" ening inventory valueBIs strongly a "unction o" ening inventory valueBmanagers o"ten try to improve this ratio as they approachmanagers o"ten try to improve this ratio as they approachyear en through inventory reuction strategies 9cashyear en through inventory reuction strategies 9cashan carry sales>inventory clearance& etc4:an carry sales>inventory clearance& etc4:
,urno+er0n+entory INV
CGS =
[4 !%"
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Prod$tivity RatiosProd$tivity Ratios+nventory Trnover +nventory Trnover
• 2hen Cost o" oos Sol is not available& it may be2hen Cost o" oos Sol is not available& it may be
necessary to estimate inventory turnover using sales4necessary to estimate inventory turnover using sales4
• ?se o" the sales 'gure is less vali than Cost o" oos?se o" the sales 'gure is less vali than Cost o" oos
Sol because Cost o" oos Sol is base onSol because Cost o" oos Sol is base oninventorie cost& but Sales inclues a pro't margin oninventorie cost& but Sales inclues a pro't margin on
top o" inventorie cost4top o" inventorie cost4
,urno+er0n+entory INV Sales=
[4 !&"
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Prod$tivity RatiosProd$tivity Ratios Average 'ays 0ales in +nventory 6A'0+7 Average 'ays 0ales in +nventory 6A'0+7
• ,stimates the number o" ays o" sales tie up,stimates the number o" ays o" sales tie up
in inventory 9base on ening inventoryin inventory 9base on ening inventory
values:values:
turnover Inventory
ADS
INV
-/
'A1S0$in+entoryinsalesaysA+erage
=
= [4 2'"
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0&ort"Term inan$ing Considerations0&ort"Term inan$ing Considerations
2or(ing Capital Management2or(ing Capital Management
Current Assets an Current LiabilitiesCurrent Assets an Current Liabilities
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0&ort"Term inan$ing Considerations0&ort"Term inan$ing Considerations
• Investment in current assets ten to rise anInvestment in current assets ten to rise an
"all #ith the volume o" activity4"all #ith the volume o" activity4
• Accruals an accounts payable 9trae creit:Accruals an accounts payable 9trae creit:
are spontaneous; liabilities4are spontaneous; liabilities4
• Other sources o" 'nancing must beOther sources o" 'nancing must be
negotiate; an be"ore using the 'rm mustnegotiate; an be"ore using the 'rm must
evaluate the cost e)ectiveness o" alternativeevaluate the cost e)ectiveness o" alternative'nancing mechanisms4'nancing mechanisms4
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0&ort"Term inan$ing Considerations0&ort"Term inan$ing Considerations
To estimate the annual e)ective rate o" return or cost 9(: o" To estimate the annual e)ective rate o" return or cost 9(: o"
any 'nancing alternative$any 'nancing alternative$
2cos
2-./ - )
rice Purchase p
t financingn-Day ! "n+=[ 242"
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0&ort"Term inan$ing Considerations0&ort"Term inan$ing ConsiderationsTrade CreditTrade Credit
• O"ten a very important source o" short-term 'nancing4O"ten a very important source o" short-term 'nancing4
• O)ers a number o" avantages$O)ers a number o" avantages$
– Readily availableReadily available
–ConvenientConvenient – le5iblele5ible
– Dsally does not entail any restri$tive $ovenants or pledges o%Dsally does not entail any restri$tive $ovenants or pledges o%
se$rity8se$rity8
• There is no e*plicit cost associate #ith creit terms There is no e*plicit cost associate #ith creit terms
such as$such as$ – @et #
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0&ort"Term inan$ing Considerations0&ort"Term inan$ing ConsiderationsTrade CreditTrade Credit
• There is usually a high implicit cost to a 'rm that "orgoes There is usually a high implicit cost to a 'rm that "orgoes
iscounts on early payment such as$iscounts on early payment such as$
– 2B=< @et #
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24 " #/
0&ort"Term inan$ing Considerations0&ort"Term inan$ing Considerations)ank !oans and a$tor Arrangements)ank !oans and a$tor Arrangements
Options inclue$Options inclue$
– (perating loans B lines o% $redit(perating loans B lines o% $redit3 0e$red by a$$onts re$eivable and inventory to a ma5imm0e$red by a$$onts re$eivable and inventory to a ma5imm
per$ent o% t&ose assetsper$ent o% t&ose assets3 +nterest only payments+nterest only payments
3 )alan$e $an be retired at t&e %irm?s dis$retion)alan$e $an be retired at t&e %irm?s dis$retion
– a$tor arrangementsa$tor arrangements
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CHAPTER 24 – Working CapitalMana ement – Crrent Assets and Crrent
24 " #
0&ort"Term inan$ing Considerations0&ort"Term inan$ing ConsiderationsMoney Market +nstrmentsMoney Market +nstrments
• Large 'rms #ith high creit ratings may be ableLarge 'rms #ith high creit ratings may be ableto by-pass 'nancial institutions an borro#to by-pass 'nancial institutions an borro#irectly "rom the money mar(et4irectly "rom the money mar(et4
• T#o "orms o" money mar(et instruments$ T#o "orms o" money mar(et instruments$ – Commer$ial paperCommer$ial paper
– )ankers? a$$eptan$es)ankers? a$$eptan$es3 T&e %irm pays a stamping %ee; and is able to borro, based on t&eirT&e %irm pays a stamping %ee; and is able to borro, based on t&eir
bank?s $redit rating8bank?s $redit rating8
•Money mar(et securities$Money mar(et securities$ – 0old at a dis$ont %rom %a$e vale0old at a dis$ont %rom %a$e vale
– Matrities at time o% isse o% #
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CHAPTER 24 – Working CapitalMana ement – Crrent Assets and Crrent
24 " #1
0&ort"Term inan$ing Considerations0&ort"Term inan$ing ConsiderationsMoney Market +nstrmentsMoney Market +nstrments
• The annuali1e yiel on a money mar(et instrument$ The annuali1e yiel on a money mar(et instrument$
-./
yielannualeAppro3imatturity Days to #a price $ar!et
Discount ×=[ 24("
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24 " #
0&ort"Term inan$ing Considerations0&ort"Term inan$ing Considerations0e$riti>ations0e$riti>ations
• Special purpose vehicles 9S0
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CHAPTER 24 – Working CapitalMana ement – Crrent Assets and Crrent
24 " #9
0mmary and Con$lsions0mmary and Con$lsions
In this chapter you have learne$In this chapter you have learne$
– T&at t&e optimal level o% investment in $as&;T&at t&e optimal level o% investment in $as&;
re$eivables and inventory o$$rs ,&en t&ere$eivables and inventory o$$rs ,&en t&e
bene%its balan$e t&e $ostsbene%its balan$e t&e $osts – T&e advantages; t&e disadvantages andT&e advantages; t&e disadvantages and
asso$iated e%%e$tive annal $osts o% t&e mostasso$iated e%%e$tive annal $osts o% t&e most
$ommon s&ort"term %inan$ing options available to$ommon s&ort"term %inan$ing options available to
$ompanies8$ompanies8
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Con$ept Revie, -estionsCon$ept Revie, -estions
2or(ing Capital Management E2or(ing Capital Management E
Current Assets an LiabilitiesCurrent Assets an Liabilities
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CHAPTER 24 – Working CapitalMana ement – Crrent Assets and Crrent
24 " 4=
Con$ept Revie, -estion =Con$ept Revie, -estion =Motives %or Holding Cas&Motives %or Holding Cas&
2hy o 'rms hol cash2hy o 'rms hol cash
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CHAPTER 24 – Working CapitalMana ement – Crrent Assets and Crrent
24 " 42
Con$ept Revie, -estion =Con$ept Revie, -estion =loatloat
2hat is 8oat an #hy is it important to the2hat is 8oat an #hy is it important to the
'rm'rm
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CHAPTER 24 – Working CapitalMana ement – Crrent Assets and Crrent
24 " 4#
+nternet !inks+nternet !inks
• Securiti1ation =et -Securiti1ation =et - http$>>###4securiti1ation4net>http$>>###4securiti1ation4net>
• Gun H +rastreet Small +usiness solutions -Gun H +rastreet Small +usiness solutions -http$>>smallbusiness4nb4com>creit-reports>bro#se-prouchttp$>>smallbusiness4nb4com>creit-reports>bro#se-proucts4aspts4asp
http://www.securitization.net/http://www.securitization.net/http://smallbusiness.dnb.com/credit-reports/browse-products.asphttp://smallbusiness.dnb.com/credit-reports/browse-products.asphttp://smallbusiness.dnb.com/credit-reports/browse-products.asphttp://smallbusiness.dnb.com/credit-reports/browse-products.asphttp://smallbusiness.dnb.com/credit-reports/browse-products.asphttp://smallbusiness.dnb.com/credit-reports/browse-products.asphttp://www.securitization.net/
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