What is Working Capital?
Working Capital Net current assets calculated as current assets minus current liabilities, representing liquidity available for day-to-day operations and short-term obligations.
Source: CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework
How is “Working Capital” Used in Practice?
A strong working capital position enables a firm to meet its short-term obligations and fund operational needs without liquidity stress.
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Who Needs to Know This Term?
- Financial Analysts
- Bankers
- Traders
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What is Working Capital?
Net current assets calculated as current assets minus current liabilities, representing liquidity available for day-to-day operations and short-term obligations.
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