Control Process in Management


3)Working Capital
: Working Capital is considering what the best way would be in terms of a management for short-term resources and obligations. The concept of this decision focuses on if it is possible to maintain enough capital for payments of its bills including and extra money earned as interest. Current assets and current liabilities are considered as the part of this decision.

The difference between net income and profits adjusted for current cost of supply comes down to the way inventories are accounted for.

Working capital is positive, meaning that the company has enough cash, accounts receivable, inventory, and short time investments to cover the current liabilities.

• Monitor the first 60 Days Activity Levels and Results and establish levels if necessary.

What is working capital? Working capital is defined as the difference between current assets and liabilities. Current assets are assets that are expected to be turned into cash in within a year. Current liabilities are obligations that are due within one year. Working capital measures the amount leftover when you take the liabilities out of the assets, this number can be positive or negative.

When looking and comparing the financial statements, there are a couple of categories that show a marked difference in the amounts or ratios that each company has. The net working capital, which shows how the current assets exceed

Nonfinancial working capital represents notes payable, accounts payable and accrued expenses subtracted from accounts receivable and inventory.

Listed below you will find a quick analysis of the company using productivity, Liquidity and solvency ratios. This analysis is accompanied by vertical and horizontal analysis. These analysis gives anyone inquiring a good picture of the company’s overall performance. This analysis is also a good way to determine the company’s financial standings for the said years.

In personal finance, net worth is the value of all your assets. An asset includes savings, home, and everything that you own and it has value. Moreover, the best way to measure and track the health of your finances is by doing it periodically. According to Siegel & Yatch (2009) your net worth is the difference between your assets minus your liabilities. But, what are your liabilities? Your liabilities are your debts or any financial obligation you have like your mortgage, school loan, and car loans. Hence, in most cases, your net worth will be positive. This means that the value of your asset is greater than the total amount you owe. However, if you owe more than you own, you will have a negative net worth. Meaning that a negative net worth is not bad, it only means that you haven’t earned enough money to overcome the weight of your debts.

The control process is a continuous flow in Taj between measuring, comparing and action. Naturally Taj follows the four steps in the control process: establishing performance standards, measuring actual performance, comparing measured performance against established standards, and taking corrective action.

Well firstly, standards are documents laying out procedures, stipulations and guidelines. Standards are designed to ensure that services, systems and products are consistent, safe and reliable. The term open standards can be define as a standard that is independent of any single owner and the general public can also amendment such standard. It also facilitate interoperability and maximise access to data, products, resources and services and are intended for widespread adoption.

A manager has several functions in any given establishment or enterprise. These functions of a manager define the manager’s responsibilities and duties in the running of a company. The main function that is of critical importance is one of control. Control is important because it is the only way managers know whether organisational goals are being met and if not, the reasons why.

According to accounting principles board of the American institute of certified public accountants U.S.A. “Working capital sometimes called net working capital is represented by the excess of current assets over current liabilities and identifies

A series of corporate collapses over the last two decades has generated consider-able debate and a strengthening of corporate governance requirements. But throughout the belief has

Cash Conversion Cycle (CCC) as a measure of working capital management, where a shorter CCC represents the aggressiveness of working capital management measured by the following Cash Conversion Cycle = Inventory days + Accounts Receivables days – Accounts Payable day