1. Robert Uberman, Financial Management, KA im Frycza Modrzewskiego 6

2. Session Six Topics Current assets and liabilities Current assets and liabilities Balancing NWC management Balancing NWC management

3. Robert Uberman, Financial Management, KA im Frycza Modrzewskiego (Net) Working Capital Short - term assets vs Working Capital Short - term assets vs Working Capital capital which costs (interests bearing liabilities) capital which costs (interests bearing liabilities) liquidity approach – confusion liquidity approach – confusion Current assetsShort-term liabilities Cash500Accounts payables700 Marketable securities300Accrued wages300 Accounts receivables800Notes payables500 Inventory900 NWC = 2500 – 1500 = 1000? Or NWC = 17(5)0-1000 = 750 Net assets vs Short-term assets Net assets vs Short-term assets

4. Robert Uberman, Financial Management, KA im Frycza Modrzewskiego Balance Sheet basic analysis (Net) Working Capital Industry and business position context critical while analysing Industry and business position context critical while analysing Exxon vs Metro (MS Excell Spreadsheet) Exxon vs Metro (MS Excell Spreadsheet) Homework: Discuss NWC Management by Pepsico 2014-2013 Homework: Discuss NWC Management by Pepsico 2014-2013 http://www.pepsico.com/docs/album/default-document- library/pepsico-2014-annual-report_final.pdf?sfvrsn=0, http://www.pepsico.com/docs/album/default-document- library/pepsico-2014-annual-report_final.pdf?sfvrsn=0, http://www.pepsico.com/docs/album/default-document- library/pepsico-2014-annual-report_final.pdf?sfvrsn=0 http://www.pepsico.com/docs/album/default-document- library/pepsico-2014-annual-report_final.pdf?sfvrsn=0 Page 71 contains a Balance Sheet Page 71 contains a Balance Sheet

5. Robert Uberman, Financial Management, KA im Frycza Modrzewskiego NWC – Business Context There’s no free lunch: squeezing suppliers (long payment periods, just in time deliveries) and customers (high discounts for immediate payments) always come at cost. There’s no free lunch: squeezing suppliers (long payment periods, just in time deliveries) and customers (high discounts for immediate payments) always come at cost. Best companies analyze and influence whole value chain to avoid hard bargaining and create synergies. Best companies analyze and influence whole value chain to avoid hard bargaining and create synergies.