Working Capital
Short definition
Working capital is current assets minus current liabilities. It nets the resources tied in inventory, receivables and cash against supplier and short-term funding.
Detailed explanation
The textbook definition takes all current items, including cash and financial debt. The cut CFOs use more often is operating working capital: trade receivables + inventory − trade payables. If the two are mixed, “working capital rose” can mean either more cash tied in operations or a new short-term draw.
Sales growth raises the cash amount of receivables and inventory even when days are unchanged. That is the mechanics of the working-capital illusion: profitable growth that still squeezes cash.
Why it matters for the CFO
Growth, pricing and credit policy create the cash need here. Banks size short-term lines off this stock. In valuation, the cash flow is ΔNWC, not the stock.
How it is calculated
İşletme sermayesi (klasik) = Dönen varlıklar − Kısa vadeli yükümlülükler
Variables in the formula
- WC: Current assets − current liabilities
How to read it
Positive working capital is not “strength”; bloated stock and receivables are positive too. Negative working capital (retail, prepaid travel) is customer and supplier funding, not a universal quality grade. Sector CCC dominates.
Numerical example
Current assets 250 mn TL, current liabilities 160 mn TL → textbook WC = 90 mn TL.
Related calculators
Güven Sayılgan’s writing on this topic
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What to learn next
Definitions are educational. They are not investment, credit or tax advice.