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Working Capital Definition

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Working Capital Definition

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  • May 16, 2026 at 5:24 pm #731060
    Avatartules
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    • Topics: 14
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    In various resources I have seen working capital defined as “all current assets – all current liabilities” (which obviously includes cash) and also “inventory + receivables – payables – overdraft” (which does not)

    The latter makes more sense to me, because cash cannot be tied up in cash, it is liquid and available.

    Is this just a case of calculate the latter if the question provides sufficient information and the former if it does not?

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