For any kind or organization working capital is a great factor, without working capital no firm can run properly. So, working capital is known as a key factor for business organization. The goal of working capital management is to manage the firm’s current assets and liability in such way that a satisfactory level of working capital is maintained (Raju, n.d.). This is so because if the firm cannot maintain a satisfactory level of working capital, it is likely to become insolvent and may even be forced into bankruptcy (Singh, 18 July 2007). Khan & Jain (2004) asserts that “[t]he current assets should be large enough to cover its current liabilities in order to ensure a reasonable margin of safety” (Khan & Jain, 2004).
Now the financial position of THAI-LAY FASHION CO. LTD is shortly prescribed below:
- The financial condition of this company good as it maintains a good amount of working capital to run its business smoothly. the company is growing day by day.
- Primarily it was financed by the owner of the company but now its most financing is going by the shareholders, and it is not so highly gearing but day by day it is smoothly gearing.
- The working capital management is good as shown by the balance sheet and other financial ratios are working properly for making the business healthy.
- This company is making profit day by day more and more, so it can be said that in the next company will reach in peak.
- If this company is non-profit earnings company nevertheless the process of Accounting should done by following Accounting principles.
- This organization is compared with its close competitors by the net profit, financial condition, goodwill, ratio analysis and economic background of the company.
- There is no further interesting issues that show up in the financial statements.
- Financial statements of this company is really needed to the Owner, Shareholders, Investor, Tax authority, Government, Employee of the firm, Internal auditor, External auditor, Management of the firm, Directors of the firm, Borrowers, Customers, Competitors and overall people from country. (Vanasco, 1996, p. 46)
- The accounts have been audited properly.
So, this study can say that this company is in highly acceptable company for the country’s people and the financial position of this shows a good position.
References
Khan, M.Y., Jain, P.K. (2004), Financial Management, Text Problems and Cases, 4th ed., Tata McGraw-Hill Publishing Company Ltd, New Delhi.
Raju, P Iyer (n.d.) “Budgeting & Budgetary Control”, Web.
Singh, Ritu. (2007), Yamaha Report. Web.
Vanasco, R. Rocco (1996) Auditor independence: an International Perspective, Managerial Auditing Journal, Vol. 11, Iss. 9, pp. 4-48.