https://mafiadoc.com/working-capital-management-efficiency-a-studyon-the-small-_59ea62441723ddb9e0b6a1a2.html) conducted in Malaysia tends to support this. By analyzing the efficiency of working capital management with the help of three indexes, the results reveal that the selected SMEs were less efficient in managing their working capital during the sample period (2010-13). The situation is likely to worsen in the current pandemic situation. You are appointed a consultant to the Association of Small and Medium Enterprises in Malaysia and the President of the organization is asking for your help in designing policies for effective working capital management of their members. While you may give necessary guidelines based on your own research of working capital management and experience of other countries including your own, you are expected to address the following questions in your report:

1. Define Cash Conversion Cycle (CCC) and explain how inventory conversion period, average collection period and payables deferral period are used to determine the cash conversion cycle. How would a reduction in cash conversion cycle increase profitability? What are some actions a firm can take to shorten its conversion cycle? Do you think a cash budget will be useful in this regard?