This assignment is designed to help student to develop a comprehensive understanding of

working capital management and its application in the context of Malaysian companies. You will

explore various aspects of working capital, including its components, financial strategies, and the

impact on a company's financial performance.

Instructions:

Answer the following questions:

Part 1: Understanding Working Capital in the Malaysian Market (20 marks)

1. Define working capital and explain its significance in a company's financial operations.

2. Provide an overview of the key components of working capital, including current assets

(e.g., accounts receivable, inventory) and current liabilities (e.g., accounts payable,

short-term debt).

3. Discuss the role of working capital in supporting day-to-day business activities, such as

managing liquidity, financing operations, and ensuring business continuity in the

Malaysian market.

Part 2: Working Capital Analysis of Malaysian Companies (40 marks)

1. Select two publicly listed companies in Malaysia from different industries.

2. Calculate and analyze the working capital for each of these companies over a specific

period (e.g., the last fiscal year). Include relevant financial data (e.g., balance sheets,

income statements) in your analysis.

3. Compare the working capital positions of the two companies and identify any significant

differences. Discuss the potential reasons for these variations.

Part 3: Working Capital Management Strategies in the Malaysian Context (15 marks)

1. Explore the various working capital management strategies employed by companies in

the Malaysian market. Consider factors such as industry dynamics, market conditions,

and business cycles.

2. Discuss the trade-off between maintaining adequate liquidity and minimizing excess

working capital. How do companies in Malaysia strike a balance between these

objectives?

3. Provide examples of Malaysian companies that have effectively managed their working

capital to enhance financial performance and create value for shareholders.

Part 4: Working Capital Efficiency and Financial Performance (20 marks)

1. Analyze the relationship between working capital efficiency and financial performance

indicators (e.g., return on assets, return on equity) for the selected companies. Assess

how efficient working capital management influences profitability.

2. Discuss the potential consequences of inadequate working capital management, such

as liquidity problems, financial distress, and reduced profitability.

Part 5: Recommendations and Conclusion (5 marks)

1. Based on your analysis, provide recommendations for the selected companies to

improve their working capital management practices.

2. Reflect on the broader implications of effective working capital management for the

Malaysian market and the finance profession