The components of a firm’s working capital are cash, accounts receivable, inventory, and accounts...

Question

The components of a firm’s working capital are cash, accounts receivable, inventory, and accounts payable. Any chief financial officer's (CFO’s) objective is to ensure that current assets less current liabilities—known as net working capital—is a positive number while also not having an excess of money tied up in nonproductive activities.

Write a memo to your CFO about the following:

How does managing the following components of working capital becomes more of a challenge when dealing internationally than domestically?
- Accounts receivable
- Inventory
Be sure to include examples of each case.

David · Accepted Answer

To: Chief Financial Officer 
From: Student Name 
Date: MM/DD/YYYY 
Subject:  Challenges on managing working capital internationally.
Mr. Chief Financial Officer, 
I just wanted to discuss you quickly that, how can we manages the challenges, which we are facing 
during the managing the working capital of the company. As you know, we have subsidiary in the 
abroad; we there increase in the account payable from the subsidiary in the company, so that we are 
shorting of cash for daily operational for the company,

The components of a firm’s working capital are cash, accounts receivable, inventory, and accounts payable. Any chief financial officer's (CFO’s) objective is to ensure that current assets less current...

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