Short-term loans and lines of credit require examination of several factors to reach the proper amount required. This is very important because underfunding or overfunding the amount a borrower requires to fund their operations can cause problems.

During this session, you will learn how to calculate the length of the financing gap, which is the time between receipt of cash from the operating cycle and the time required to pay creditors. Specifically, the course will demonstrate the key financial ratios to determine the financing gap, and how to utilize this data to determine the Asset Conversion Cycle and the Operating Cycle.

The course will then proceed to calculate the amount required to fund the financing gap by determining the Net Working Investment and the potential sources of cash to fund the gap before the institution's funds are deployed.What You'll Learn:

• Define the Asset Conversion Cycle, Operating Cycle, and Fixed Asset Cycle
  
• Calculate the Financing Gap by Utilizing Financial Ratio Analysis
  
• Determine Sources of Cash to Fund the Financing Gap Before the Institution's Funds are Required
  
• Address Why a Revolving Line of Credit is Not Revolving
  
• Know the Common Causes of a Line of Credit Becoming Permanent Working Capital
  
• Negotiate More Effectively with Borrowers Requesting Short-Term Funding