Definition : Working capital

Financial resources available to a syndicate of co-owners to face the day-to-day expenses, as they fall due. It represents the ability to meet short-term financial obligations. In mathematical terms, the working capital is calculated as follows: Current assets - Current liabilities = Working capital. The syndicat is able to pay its bills as long as the working capital is positive.

 WARNING ! The working capital should not be confused with the concept of funds established by the fund basis of accounting.

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