The other shareholders have approached TL’s accountants to review the situation.
Prepare a report of up to 1,250 words for the shareholders addressing the following issues.
i.Explain:
a.what is meant by Profit and Cash flow and how they are different
b.what is meant by Working Capital and, the meanings of Receivables, Inventory and Payable.
c.how changes in Working Capital affect Cash flow
ii.Apply the concepts in (i) above to this company to show how the way the company is being managed might affect its financial results.
iii.Analyze and recommend what steps should now be taken to improve this company’s cash flow through better Working Capital management.
