Working Capital Scorecard: A Tumultuous Year

Shortfalls in revenues, curtailed or redirected consumer desire, liquidity pressures, receivables collection headaches  — on the functioning cash entrance, 2020 put finance departments to the check.  How did the biggest U.S. businesses conduct over-all?

Quite a few, especially those people with marketplace clout, improved their functioning cash general performance and stayed a lot liquid. Nonetheless, for many others, a pandemic-disrupted economic climate meant also a lot cash tied up in working day-to-working day buying and selling functions.

The funds conversion cycle (CCC) for the biggest one,000 businesses greater to 33.7 days in 2020 from 33.one in 2019, according to the annual CFO/The Hackett Group Doing the job Funds Scorecard.

The funds conversion cycle demonstrates how efficiently businesses convert assets to funds. (The equation is days gross sales excellent in addition days inventory excellent minus days payables excellent.)

The surprise is that CCC didn’t worsen much more than that, provided

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