ABSTRACT
Working capital, the investment in inventories and debtors net of creditors, is a signifi cant investment in many companies ’ balance sheets. In order to create value for shareholders, this investment needs to be managed down to the minimum levels consistent with the company’s business strategy. In order to do this, it is important to understand the reasons why the investment in inventories and debtors is being made, and to deal with areas of ineffi ciency and inconsistency.
