Working capital
Working capital is a liquidity and working-capital metric, calculated as Current assets − Current liabilities.
- Layer
- Metric
- Defined in
- Metric definitions
- Nearby
- 15
Authority
This definition follows Non-GAAP financial measure — SEC Regulation G — it is not a GAAP measure, so a registrant publishing it has to reconcile it to the nearest GAAP figure.
Every citation in this system, with the text we read and the date we checked it, is in US GAAP and where these rules come from.
Formula
Current assets − Current liabilities
Absolute, not a ratio.
A metric without its definition is a number people argue about in meetings. Every metric component in this system requires one — see the rules.
The lessons that teach this
Accounting, 0 to 1 — a free course taught end to end on one month of one company, with the spreadsheet exercises to work it yourself.
- 11The balance sheetThe other three account types, at one instant — and the single line where the month's profit lands, which is what ties the two statements together.10 min
- 12The cash flow statementNorthwind earned $2,550 and its operations consumed $3,100. The third statement is the one that explains the difference, line by line.12 min
Working capital, in use
Quoted from the document that use the word — what it does to an interface, in the spec's own sentence.
The vertical-specific take: purpose-built accounts and cards for particular business models, with working capital and credit lines layered in.
For founders
The same idea written for a founder: what it costs a startup that ignores it, and what to do in a real month.
Nearby in the catalog
No component names this concept outright. These are the ones in its part of the system, which is a weaker claim — but a component nothing links to is a component nobody finds.
7Dashboard & charts
Family spec- MetricDefinitionEvery metric requires one. Formula with values substituted.
- NonGaapReconciliationEBITDA below net income, every adjustment named.Spec
- MrrBridgeThe movement, not a single number with a percentage.Spec
- BudgetVsActualPolarity-aware, materiality-filtered, versions tracked.
- ForecastTableProjections dashed and labeled everywhere.
- CovenantMonitorThe contractual definition, not the generic one.Spec
- KpiHealthStripProvisional marking for pre-close numbers.Spec
- RevenueTrackerRevenue by stream, with mix, growth and concentration.
- ExpenseTrackerSpend by category on three bases. Polarity derived per row from the sign convention.
- DriverModelThe inputs a forecast is built from, and what they produce.
- ScenarioCompareScenarios side by side, all measured against the base.
- PlByDimensionThe P&L cut by department, entity or product.
Also in Liquidity & working capital
Work with this concept
The calculators that compute it and the ledger payloads that carry it. A definition is where a reader starts; these are where they go next.
Defined in Metric definitions. This page is generated from that document, so the two cannot disagree.