Authors:
Dhina Suresh, G. Rajasekaran, M. Sakthivanitha, Prasanna Ranjith Christodoss, M. Mohamed Sameer Ali
Addresses:
Department of Computer Science, St. Joseph’s College of Arts and Science for Women, Hosur, Tamil Nadu, India. Department of Computer Science and Business Systems, Dhaanish Ahmed College of Engineering, Chennai, Tamil Nadu, India. Department of Information Technology, Vels Institute of Science Technology and Advanced Studies, Chennai, Tamil Nadu, India. Department of Computing, Mathematics and Physics, Messiah University, One University Ave, Mechanicsburg, Pennsylvania, United States of America. Department of Computer Science Engineering, Dhaanish Ahmed College of Engineering, Chennai, Tamil Nadu, India.
All businesses, small, medium, or large, require finance to continue their operations and to meet their target. Finance is so vital nowadays that it's aptly described as the lifeblood of a business. No business can fulfil its goals without sufficient finance. Thus, this paper is concerned with analysing different aspects of working capital management essential to performing day-to-day activities. This paper is concerned with the analysis of “Working Capital Management” in Software Firms. In working capital management, the company is confronted with two important issues: First, based on the level of sales and the corresponding cost considerations, what are the optimal levels of cash, accounts receivable, and inventories that a company should opt to hold? Second, having these optimal quantities, how can these working capital investments be most economically financed? To generate the highest possible performance, companies should have no idle assets and utilise the lowest-cost sources of financing. Why? Generally, it is very favourable for the company to invest in short-term assets and to use short-term liabilities. The scope of the study is determined after and during the study. The primary scope of the study was to apply theoretical concepts in real-life work experience. The working capital study is founded on tools such as Ratio Analysis and the statement of changes in working capital. Additionally, the study is founded on last year's Annual Reports of Software Companies.
Keywords: Working Capital Management; Optimal Amounts; No Unproductive Assets; Real Life Work Experience; Software Companies; Short-Term Obligations; Financing Working Capital; Debtors and Circulating Assets.
Received on: 05/08/2024, Revised on: 20/10/2024, Accepted on: 09/12/2024, Published on: 05/03/2025
DOI: 10.64091/ATICS.2025.000104
AVE Trends in Intelligent Computing Systems, 2025 Vol. 2 No. 1, Pages: 39-51