A company's efficiency, financial strength and cash-flow health show in its management of working capital. Knowing what the company's financial statements mean will help you to analyse your investments. This is why analysts are sensitive to decreases in working capital; they suggest a company is becoming over leveraged, is struggling to maintain or grow sales, is paying bills too quickly, or is collecting receivables too financing small business slowly. A company can be endowed with assets and profitability but short of liquidity if its assets cannot readily be converted into cash. Analysts

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