S. David Young
Professor of Accounting and Control
The boom years made businesses careless with working capital. So much cash was sloshing around the system that managers saw little point in worrying about how to wring more of it out, especially if doing so might dent reported profits and sales growth.But today capital and credit have dried up, customers are tightening belts, and suppliers aren’t tolerating late payments. Cash is king again.In this article the authors explore six common mistakes that companies make in managing working capital. The simple act of correcting them could free up enough cash to make the difference between failure and survival in the current recession.