Study on Working Capital Financing Practices: With Special Reference to Risks

In working capital, short term investment and financing activities are considered. Working capital is known as an important component of financial management. Profitability and liquidity of a firm depends on the working capital of that firm. It is very significant for corporate finance management. In order to reduce the risk factors, all the current assets and liabilities are managed by working capital management in such a way that excessive investment in these assets can be avoided. The management of short-term assets and liabilities should be done carefully as the profitability and risk management of a firm can be affected by the working capital management. The current paper highlights the impact of working capital on risk factors.