robert uberman, financial management, ka im frycza modrzewskiego 6
DESCRIPTION
Robert Uberman, Financial Management, KA im Frycza Modrzewskiego (Net) Working Capital Short - term assets vs Working Capital Short - term assets vs Working Capital capital which costs (interests bearing liabilities) capital which costs (interests bearing liabilities) liquidity approach – confusion liquidity approach – confusion Current assetsShort-term liabilities Cash500Accounts payables700 Marketable securities300Accrued wages300 Accounts receivables800Notes payables500 Inventory900 NWC = 2500 – 1500 = 1000? Or NWC = 17(5) = 750 Net assets vs Short-term assets Net assets vs Short-term assetsTRANSCRIPT
Robert Uberman, Financial Management, KA im Frycza ModrzewskiegoRobert Uberman, Financial Management, KA im Frycza Modrzewskiego
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Robert Uberman, Financial Management, KA im Frycza ModrzewskiegoRobert Uberman, Financial Management, KA im Frycza Modrzewskiego
Session Session SixSix Topics Topics
Current assets and liabilities Current assets and liabilities Balancing NWC managementBalancing NWC management
Robert Uberman, Financial Management, KA im Frycza ModrzewskiegoRobert Uberman, Financial Management, KA im Frycza Modrzewskiego
(Net) Working Capital(Net) Working Capital Short - term assets vs Working CapitalShort - term assets vs Working Capital
capital which costs (interests bearing liabilities)capital which costs (interests bearing liabilities) liquidity approach – confusionliquidity approach – confusion
Current assCurrent assetsets Short-term liabilitiesShort-term liabilitiesCashCash 500500 Accounts payablesAccounts payables 700700Marketable securitiesMarketable securities 300300 Accrued wagesAccrued wages 300300Accounts receivablesAccounts receivables 800800 Notes payablesNotes payables 500500InventoryInventory 900900
NWC = 2500 – 1500 = 1000? OrNWC = 2500 – 1500 = 1000? OrNWC = 17(5)0-1000 = 750NWC = 17(5)0-1000 = 750
Net assets vs Short-term assetsNet assets vs Short-term assets
Robert Uberman, Financial Management, KA im Frycza ModrzewskiegoRobert Uberman, Financial Management, KA im Frycza Modrzewskiego
Balance Sheet basic analysisBalance Sheet basic analysis(Net) Working Capital(Net) Working Capital
Industry and business position context critical Industry and business position context critical while analysingwhile analysing
Exxon vs Metro Exxon vs Metro (MS Excell Spreadsheet)(MS Excell Spreadsheet)
Homework: Discuss NWC Management by Pepsico 2014-Homework: Discuss NWC Management by Pepsico 2014-20132013
http://www.pepsico.com/docs/album/default-http://www.pepsico.com/docs/album/default-document-library/pepsico-2014-annual-document-library/pepsico-2014-annual-report_final.pdf?sfvrsn=0,report_final.pdf?sfvrsn=0,
Page 71 contains a Balance SheetPage 71 contains a Balance Sheet
Robert Uberman, Financial Management, KA im Frycza ModrzewskiegoRobert Uberman, Financial Management, KA im Frycza Modrzewskiego
NNWC – Business ContextWC – Business Context There’s no free lunch: squeezing suppliers (long There’s no free lunch: squeezing suppliers (long
payment periods, just in time deliveries) and payment periods, just in time deliveries) and customers (high discounts for immediate customers (high discounts for immediate payments) always come at cost.payments) always come at cost.
Best companies analyze and influence whole Best companies analyze and influence whole value chain to avoid hard bargaining and create value chain to avoid hard bargaining and create synergies.synergies.