Cash tied up between buying and getting paid.
Working-capital analysis follows the time between a supplier commitment and the customer’s payment. The useful detail sits inside receivables, inventory and payables, rather than in their totals alone.
Receivables need a collection view.
An aging report may not explain why invoices remain unpaid. An invoice missing a purchase-order reference needs administrative correction; a disputed charge needs agreement on the amount. An extended payment term may already be correct.
We examine material balances with the finance team, separate recurring issues from isolated items and connect the expected receipts to the cash forecast. A collection estimate should reflect the facts of the invoice, including any unresolved deduction.
Inventory commits cash before it is sold.
Stock on hand is only part of the commitment. Deposits, open purchase orders, minimum order quantities and goods in transit can all affect the next payment cycle.
The analysis relates those commitments to expected use or sale. Slow-moving stock and an essential component awaiting another part require different treatment. Production and purchasing colleagues supply the operating context; finance translates the dates and amounts into cash.
- Which open orders require a deposit before delivery?
- How much is already committed to goods in transit?
- When is slow-moving stock expected to be used or sold?
- Does a minimum order exceed the next production requirement?
Supplier terms have an operating consequence.
Moving a payment can alter a discount, credit limit or supply arrangement. We compare the cash effect with the terms the supplier has actually offered and the purchases the business expects to need.
A changed date affects short-term cash; a lost discount or required deposit can also change the amount paid. Supplier discussions need both effects.
The work can include an annotated receivables view, inventory commitments and a payment calendar. Each material forecast adjustment carries the basis for its date and amount.