IFO4
Loading...The difference between current assets and current liabilities, representing the short-term liquid resources available to fund day-to-day operations. Working capital is the load-bearing measure of an organisation's ability to meet near-term obligations without recourse to external financing. The federation requires working capital to be expressed both as an absolute figure and as a coverage ratio against ninety days of operating expense. A persistently negative working capital posture without a documented financing arrangement is treated as a Tier-1 risk indicator under MEV-Annex:4.1.
Coined in nineteenth century industrial accounting; the term distinguishes the rotating fund of operations from the fixed capital tied up in plant.
Federation members include working capital and the ninety-day coverage ratio in their quarterly disclosure. Coverage below 1.0 triggers an automatic review under TGS-002:2.3. Working capital management practices are evaluated as part of the treasury maturity assessment.
@misc{ifo4_glossary_working_capital,
title = {{Working Capital}},
author = {{IFO4 Federation Editorial Board}},
howpublished = {{IFO4 Federation Glossary, slug \texttt{working-capital}}},
year = {2026},
url = {https://ifo4.org/glossary/working-capital},
note = {Category: Capital; key: WorkingCapital}
}Federation members and accredited practitioners may challenge any entry under TGS-002:1.7. Filed challenges are routed to the editorial board, triaged into the revision register, and resolved in writing on the public docket. The slug remains stable through any revision.