Bài luận văn quản trị vốn lưu động bằng tiếng anh học viện tài chính bằng tiếng anh về công ty May 40 Hà Nội đạt điểm A. Working capital management at Hanoi no 40 JSC. Làm theo đúng thứ tự đề cương của gíao viên hvtc hướng dẫn và đã được chỉnh sửa
DECLARATION I hereby declare that this thesis is my own work and effort It has not been submitted anywhere for an award Where other sources of information have been used, they have been acknowledged Graduation thesis author Lê Thu Uyên Lê Thu Uyên- CQ56.11.03CLC ACKNOWLEDGEMENT I would like to express my deep gratitude to all those who have given me the possibility to complete this graduation thesis In preparing this graduation thesis, I have had generous help and advice from my teachers, my colleagues, my family and my friends I would like to express my great thanks to all of them First of all, I would like to express my deepest gratitude to my supervisor, Bui Thu Ha, lecturer of Academy of Finance, who has given immeasurable help, constant guidance with many careful instructions, comments and valuable advice to me whenever I need Without her support, I am not able to have a complete thesis And I really appreciate her patience in reading and correcting my thesis Second, I wish to show my sincere thanks to all my teachers at Academy of Finance, who have provide me with worthy lessons throughout years of study Moreover, I have furthermore to thank the staffs of Hanoi 40 Garment Joint Stock Company for their valuable supports during the internship period Without their helps, it would be impossible for me to finish this work Last but not least, I would like to send my loving thanks to my family whose great love and care in both spirit and health to encourage me to complete the thesis Lê Thu Uyên- CQ56.11.03CLC ABSTRACT This study investigated the factual state of working capital management efficiency at Hanoi 40 Garment Joint Stock Company from the viewpoint of a fourth year student of Coorporate Finance, Academy of Finance The paper aims at finding out the drawbacks in the company’s working capital management and the reasons, and more importantly suggesting main methods to improve the efficiency of working capital management in the company In achieving these aims, the graduation paper surveys the current situation of working capital management and assess that whether it is effective or not From received results, the study argues the most practical implications at Hanoi 40 Garment Joint Stock Company to improve the efficiency of working capital of the company in the year to come Lê Thu Uyên- CQ56.11.03CLC LIST OF ABBREVIATIONS VND : Viet Nam dong CAR : Current account receivables CAP : Current account payables Lê Thu Uyên- CQ56.11.03CLC INTRODUCTION Rationale of the study In the market economy, working capital plays an essential role to maintain smooth running of a business No business can run successfully without an adequate amount of working capital because it is considered as the flesh and blood of an enterprise Enterprises that have paid a lot of attention in managing capital and using them efficiently gain a lot of opportunities to generate much more working capital internally, thereby lowering costs, improving their performance and boosting their competitive position However, in fact, because of remnants of the global financial crisis, geopolitical challenges and negative effects of the Covid-19 epidemic in West Africa, domestic enterprises have to face a lot of difficulties as well as the shortage of capital for many years The challenge of efficiently managing and using working capital becomes an urgent problem of all businesses More and more enterprises make losses because the ways they manage their working capital is inefficient This not only affects the survival and development of enterprises but also adversely affects the whole national economy stability The waste of capital, using capital inefficiency and overlapped capital has limited competitiveness and development among businesses Therefore, to get rid of this bad situation, businesses should ask themselves “How to improve the efficiency of working capital management?” This is not a simple question, but a hard question that enterprises can not deal with immediately They should have an appropriate, proper and reasonable strategy that can draw different ways to improve the efficiency of working capital management, simultaneously focus on capital management activities in utilization to gain optimum profitable target and keep sustainable development Lê Thu Uyên- CQ56.11.03CLC To be aware of the importance of working capital and be inspired of the necessity of effectively managing working capital of during training time at Hanoi 40 Garment Joint Stock Company, as well as based on knowledge and practical experiences I got during the internship, I’m going to choose the topic: “Working capital management at Hanoi 40 Garment Joint Stock Company” as my graduate thesis title Purposes and Research questions - To provide the knowledge and information of working capital management activities at Hanoi 40 Garment Joint Stock Company - To understand the situation of working capital management activities at Hanoi 40 Garment Joint Stock Company - To identify and analyze the causes of the drawbacks of Hanoi 40 Garment Joint Stock Company’s working capital management - To suggest main methods to improve and strengthen the efficiency of working capital management The scope of the study The research focuses on the efficiency of working capital management at Hanoi 40 Garment Joint Stock Company from 2018 to 2020 and suggestions to improve this activity Data and Research methodology Based on knowledge at university, books and self-accumulation and to achieve these above objectives, several methods of studying the thesis are used as follow: - Figure collection: from websites of Hanoi 40 Garment Joint Stock Company, books, magazines, internet and internal information of the corporation - Inductive, deductive and statistical method - Figure comparison, data evaluation, judgment and conclusion Lê Thu Uyên- CQ56.11.03CLC - Method of analyzing, summarizing, synthesizing materials and books from the theoretical background Thesis structure Besides the Contents, Introduction, Conclusion and References, the thesis consists of chapters - Chapter 1: This chapter provides a general overview of working capital and the necessary of improving the efficiency of working capital management - Chapter 2: The main part of the thesis It gives the overview of the development of Hanoi 40 Garment Joint Stock Company and the current management of working capital in this corporation - Chapter 3: This chapter gives the orientations for the future development of Hanoi 40 Garment Joint Stock Company and provides some practical recommendations and solutions to improve the efficiency of working capital management of this company Lê Thu Uyên- CQ56.11.03CLC TABLE OF CONTENT DECLARATION i ACKNOWLEDGEMENT ii ABSTRACT iii LIST OF ABBREVIATIONS iv INTRODUCTION v CHAPTER 1: THEORETICAL BACKGROUND OF WORKING CAPITAL MANAGEMENT OF A COMPANY 1.1 Working capital and financing working capital 1.1.1 Definition and features of working capital 1.1.1.1 Definition of working capital 1.1.1.2 Chracteristics of working capital 1.1.2 Classification of working capital 1.1.2.1 Based on the form of expression 1.1.2.2 Based on the role of capital 1.1.3.1 Based on capital ownership relationship 1.1.3.2 Based on time raising and using capital 1.1.3.3 Based on scope of rasing capital 1.2 Working capital management 1.2.1 Definition and objectives of working capital management 1.2.1.1 Definition of working capital management 1.2.1.2 Objectives of working capital management 1.2.2 Contents of working capital management 1.2.2.1 Determining working capiatl needs and working capital financing 1.2.2.2 Components of working capital 17 1.2.2.3 Cash management 18 1.2.2.4 Accounts receivable management 19 1.2.2.5 Inventory management 21 1.2.3 Indicators evaluating working capital management 26 1.2.3.1 Indicators evaluating working capital financing management 26 1.2.3.2 Indicators evaluating structure of working capital 27 Lê Thu Uyên- CQ56.11.03CLC 1.2.3.3 Indicators evaluating cash management 28 1.2.3.4 Indicators evaluating account receivable management 29 1.2.3.5 Indicators evaluating inventory management 30 1.2.3.6 Indicators evaluating working capital management 31 1.3 Factors determining working management 32 1.3.1 Internal factors 32 1.3.2 External factors 34 CHAPTER 2: SITUATION OF WORKING CAPITAL MANAGEMENT AT HANOI 40 GARMENT JOINT STOCK COMPANY 35 2.1 Overview of Hanoi 40 Garment Joint Stock Company 35 2.1.1 Establishment and Development of Hanoi 40 Garment Joint Stock Company 35 2.1.2 Business characteristics of Hanoi 40 Garment Joint Stock Company 37 2.1.2.1 The functions and resposibilities of company 37 2.1.2.2 The situation of organizing business activities of the company 39 2.1.2.3 Characteristics of production and business activities of the company 49 2.1.2.4 Production process of the company 49 2.1.2.5 Technical facilities of the company 51 2.1.2.6 The situation of product comsumption activities and competitive position 52 2.1.2.7 The situation of personnel of the company 53 2.1.3 General information on financial situation of Hanoi 40 Garment Joint Stock Company 54 2.1.3.1 Advantages and disadvantages in the operation of the company 54 2.1.3.2 The situation of business result of the company 56 2.1.3.3 The situation of fluctuation of Company’s assets 59 2.1.3.4 The situation of fluctuation of Company’s liabilities and equity 63 2.1.3.5 Assement of funding model of the company 67 2.1.3.6 Overview some finacial ratios of the company 69 2.2 The situation of working capital management at Hanoi 40 Garment Joint Stock Company 72 2.2.1 Determining the needs for working capital and working capital financing at Hanoi 40 Garment Joint Stock Company 72 2.2.1.1 The situation of working capital 72 2.2.1.2 The situation about determining working capital requirement 77 Lê Thu Uyên- CQ56.11.03CLC 2.2.2 Components of working capital at Hanoi 40 Garment Joint Stock Company 77 2.2.3 Cash management at Hanoi 40 Garment Joint Stock Company 2.2.4 Account receivable at Hanoi 40 Garment Joint Stock Company 95 2.2.5 Inventory management at Hanoi 40 Garment Joint Stock Company 100 2.2.6 Indicators evaluating working capital management at Hanoi 40 Garment Joint Stock Company 102 2.3 Assessment of the working capital management at Hanoi 40 Garment Joint Stock Company 104 2.3.1 Achievement 104 2.3.2 Shortcomings and causes 105 CHAPTER 3: SOLUTION TO IMPROVING THE WORKING CAPITAL MANAGEMENT AT HANOI 40 GARMENT JOINT STOCK COMPANY 107 3.1 Objectives and strategic development directions at 40 garment joint stock company 107 3.1.1 Socio-economic context 107 3.1.2 Objectives and strategic development directions of Hanoi 40 Garment Joint Stock Company 110 3.2 Solution to improving the working capital management at Hanoi 40 Garment Joint Stock Company 112 3.2.1 Precisely determining the working capital requirement of the company 112 3.2.2 Accurately finding the reasonable sources to finance working capital and balance the working capital structure 114 3.3.3 Determining and managing cash reserve amount 116 3.3.4 Improving the management of inventories 118 3.3.5 Improving to use working capital effectively 121 3.3 Conditions for implementing solutions 123 3.3.1 Conditions of State 123 3.2.2 Conditions of Company 124 CONCLUSION 125 REFERENCES 126 Lê Thu Uyên- CQ56.11.03CLC 3.2 Solution to improving the working capital management at Hanoi 40 Garment Joint Stock Company To be able to achieve the set goals, the Company needs to strengthen the financial management in the measurement including the management of working capital Through reviewing and assessing the current situation of working capital management of the Company, it can be seen that a number of limitations and inadequacies adversely affect the working capital management, making the effective use of capital mobility is reduced Below are some proposed solutions to strengthen working capital management at Hanoi 40 Garment Joint Stock Company, helping to improve working capital management efficiency: 3.2.1 Precisely determining the working capital requirement of the company One of the best solutions to deal with weaknesses in working capital management is to determine the appropriate requirement of working capital To carry on the business, every company needs capital especially working capital to meet the daily requirements However, it does not mean that the company has to have a lot of working capital If the company has too much working capital, it will lead to working capital stagnant and ineffective working capital using, less profit and high interest rate expense of debt Vice versa, if the enterprises not determine sufficient working capital requirement, it will lead to interruption of production process, business slowing down and decreasing business opportunity So precisely determining the working capital requirement for operation helps the company avoid capital congestion, unnecessary expenses, ensure the sufficient capital for day-to-day business activities and financial security for the company And Hanoi 40 Garment Company is not an exception Son needs to define accurately a proper amount of working capital So the question is: “What is the proper Lê Thu Uyên- CQ56.11.03CLC amount of working capital?” It is not an absolute amount It depends upon the needs and circumstances available in the company To answer for above-mentioned question, we have broadly three methods of estimating the requirement of working capital of a company: percentage of revenue or sales method, components method, and operating cycle method Estimating working capital means calculating future working capital and Son Ha could use one of them to determine the right one • Percentage of Sales Method: It is the easiest of the methods for calculating the working capital requirement of a company This method is based on the principle of „history repeats itself‟ For estimating, relationship of sales and working capital is worked out for say last years If it is constantly coming near say 40% Advantage of this method is that it is very simple to understand and calculate also Disadvantage includes its assumption which is difficult to be true for many organizations • Components method: Here we take up one of the planning models of working capital to estimate working capital The method adopted here attempts at estimation of working capital and its components by taking into account, the period for which the various items remain as stock or as outstanding, the cost structure of production and annual production It assumes even production and even sales, throughout and what is produced is completely sold • Operating Cycle Method: This is probably the best of the methods because it takes into account the actual business or industry situation into consideration while giving an estimate of working capital A general rule can be stated in this method Longer the working capital operating cycle, higher would be the requirement of working capital and vice versa In fact, it can be seen that there is no one definite model that can be applied to every business when it comes to determining working capital needs Therefore, the company Lê Thu Uyên- CQ56.11.03CLC must develop a scientific and appropriate method by itself based on its specific characteristics and situations Through researching a number of practical documents on financial management and operating characteristics of the company A company can use the Percentage-ofSales Method to determine its working capital needs for the planning period Because this is a simple and easy-to-implement method of predicting working capital needs, moreover, through the analysis of the Company's financial statements over many years (2018-2020), it is found that the proportion of key items in working capital (cash capital, receivables, inventory) have large fluctuations, so this is the right method for the company's situation Although this method is simple and easy to apply, it can estimate the relationship between assets, capital and revenue of the Company, but the accuracy of capital needs depends heavily on revenue estimation Therefore, the calculation of expected revenue requires understanding, mastering the law, the relationship between revenue and factors, business performance, growth ability in the coming year and projections about market volatility However, in reality, there can be a lot of big changes in procurement conditions, inventory of materials and goods, or commodity consumption policies Therefore, to predict the level of working capital needs In the event of unusual changes, the company should determine an appropriate working capital requirement adjustment ratio 3.2.2 Accurately finding the reasonable sources to finance working capital and balance the working capital structure As I analyzed in chapter II, the structure of working capital sources was unsafe and risky, in which the temporary working capital sources held the larger part than the regular one The company used short-term resources to finance long-term assets, which causes financial imbalance because almost all temporary working capital sources came Lê Thu Uyên- CQ56.11.03CLC from short-term loans and trade payables items Therefore, to manage working capital well the company should proactively find the reasonable sources to finance working capital to reduce risks, minimize the capital using expenses and balance the financial situation The followings are some sources that are suitable for the company’s business activities: • Retained Earning: This is the first source of funding considered In the distribution of annual profits, the company always deducts a part from profit after tax to serve reinvestment The rate of reinvested profit that the company set aside is expected to be about 10-30% of the profit after tax, this ratio will not be fixed but be flexible depending on the situation of business results, growth strategy of the company Company in the near future Although this is the first source of funding used for financing, the reinvested profit can only cover a small part of the working capital needs, so the company needs to consider mobilizing additional sources funding from outside • Bank Loans: Working capital, or the money a company needs to run its normal operating cycle, can be obtained by borrowing from banks Borrowers can turn to commercial lenders, credit unions, local banks for these types of loans The repayment terms can a short as one- year and as long as seven years Bank credit capital is the additional capital, not the frequent capital which joins and forms the company With the appropriate interest rate, bank loans can help the company deal with the temporary difficulties However, when borrowing from banks the company should consider the solvency of the company as well as build a proper business plan to make sure that the business is always profitable • Trade Credit: Businesses can also make trade credit agreements with their long-time suppliers The suppliers agree to provide the service or goods with delayed payment terms Trade credit terms are wholly determined between supplier and business owner, but most credit extended is typically due no more than 90 days after service Lê Thu Uyên- CQ56.11.03CLC or supply date The company should have a particularly good relationship established with trade creditors This can not be considered as a major capital fund but when using this capital, the company does not have to pay expenses However, the company can not abuse this fund because its can only be accounted for temporary period • Raise capital from employees in the company: This solution will reduce pressure on long-term capital as well as potential risks in the business It makes employees motivate in working with high responsibility, which contributes for the improvement of the company competitiveness However, to build a suitable working capital structure with suitable sources, the company should develop capital-mobilizing strategies in accordance with market conditions and business environment in each period They should also to estimate the risks and their solvency when borrowing from banks and ensure the safety of funds but still promote business activities Besides, the company needs to create trust for capital suppliers by enhancing the prestige of the company: Stabilize and rationalize financial norms, payoff loans on time 3.3.3 Determining and managing cash reserve amount The optimal amount of cash reserves of the Company must satisfy main requirement: - Expenses for payables for daily production and business activities of the company such as payments to suppliers of goods or services, payments to employees, payment of taxes - Provision for unplanned expenses - Provision for unexpected opportunities when the market changes suddenly The company should develop a method or scientific model to determine the appropriate level of cash reserves Calculating and building budget planning tables to Lê Thu Uyên- CQ56.11.03CLC help the Company estimate the budget norm is an effective tool in forecasting the time of budget deficit so that it can prepare sources to make up for the shortfall this In addition, detailed periodic forecasting methods by week, month, quarter and general year for year must also be used regularly After determining the regular cash reserve amount, the company should apply the following soluttions and procedures to minimize risks as well as operating losses: - Payment accountant needs monitoring by opening book in detail of accounts receivable, identifying overdue receivables and calculating interest for this overdue receivables Especially, with the order of high value, the company should require customers to give advanced payment in order to ensure the ability to recover the debt The company should apply the trade discount policy for investors to encourage them to pay the debt as soon as possible It can increase the amount of money in the company and close the gap between the cash flow from business operations and net revenues - During the process of signing the construction contract, the company must prepare terms of the contract in detail, especially about the advanced payment and the payment process The company should give specific binding of payment if the investor violates any terms of this contract The terms of selling on credit for customers and delaying payment for investors must be declared in the contracts about the time of credit, payment discount, late payment penalty Evaluating the liquidation and credit capacity of the customers is identifying the payment capacity of the customers, whether they pay the debts on time The company needs to analyze such indicators as: customers‟ solvency, law compliance, business attitude Besides, the company needs to evaluate the credit capacity They should only provide products for customers who are punctual, compliant and have good reputation The company also needs to strictly regulate the time of payment, types of payment and late payment penalty, ensure the capacity of debt collection Lê Thu Uyên- CQ56.11.03CLC - The company should focus on handling bad debts and strengthening accounts receivable supervision To deal with bad debts the company should have some strategies as bellows: • Enhance payment discounts to customers: the increase of payment discounts rate will encourage customer early payment and attract more new customers • The other short-term receivables should be recovered in time to avoid capital stagnation affecting capital efficiency of the company The company should apply overdue interest rate of 150% for overdue debts the same as Bank • Provision for doubtful debts need to be done The deduction amounts depend on the actual situation of the company receivables and in accordance with law Making provision for receivables helps the company more active in case customers not have the ability to pay debt • The company needs to control the account receivables by organizing them in time period and collecting receivables before due day 3.3.4 Improving the management of inventories Hanoi 40 Garment Company’s current inventory management is not really effective because the levels of inventories increased dramatically and the inventory turnover decreased moderately reflected the risks of capital backlog which does not make any benefit for the company This is not a good perspective for the company because the company had to wait longer to sell products and generate profits Decreasing inventory turnover often means sales are decreasing below expected levels That would increase the expenses to hold these inventories and result in capital backlog As we can see, the company did not have a good direction of inventory in management Therefore to reduce inventories holding costs and boost sales, the company should consider the following steps to improve the efficiency of inventory management: Lê Thu Uyên- CQ56.11.03CLC Step 1: Conduct market research about prices of raw materials, plan reserve materials if it‟s price is expected to increase in the future (this requires accurate information and the ability to accurately predict based on real situation, should be carried out by a team of highly qualified staff) At the same time, the company should keep a close relationship with the providers and select vendors which have the most preferential prices as well as choose suitable means of transport to minimize transport costs Step 2: Set plan to buy, reserve materials in a reasonable quantity, forecast demand to ensure that amount of materials in the warehouse can meet the demand of manufacturing and trading Having too much inventory results in paying additional storage costs, and having too little inventory can result in paying additional fees for rushing orders and expedited shipping Son Ha International Corporation needs to forecast the demand in order to avoid under or over stocking products, forecast the demand so that the correct level of inventory is maintained Step 3: Carry out the classification management for each type of material, monitor the number of materials used in day, the inputs, the number of corrupted materials, and original daily report to management Son Ha should frequently supervise the reserve level for each product line and the research on the customers‟ preference and interest to determine the product lines that should be imported more, avoiding the shortage of one item and the excess of the other Step 4: Use technology for many advantages There‟s a wide selection of inventory management software on the market today The right technology can more than pay for itself by helping the company‟s streamline and improve inventory management and reduce costs Step 5: Train the employees well Any employee responsible for ordering anything that comes through the doors of the company, whether it‟s floor merchandise, Lê Thu Uyên- CQ56.11.03CLC raw materials, or just pens and paper towels, should receive inventory management training This will help the company manage the inventories proactively and effectively Step 6: Enhance preservation of raw materials, improve management efficiency by building the warehouse for storage of materials to avoid losses due to weather, climate or the theft Step 7: The last step is to reduce the lead time The longer the lead time, the more inventories the company has in its warehouse The manager should work with suppliers and the warehouse on ways to get items scanned into inventory sooner The faster products can get into inventories after an order is made on a consistent basis, the less inventories needs to be held into stock During my internship at Son Ha International Corporation, the company use justin-time inventory management practices In manufacturing processes, just-in-time inventory management means having the right material, at the right time, in the right place, and in the right amount needed to make a product Unlike traditional inventory management, just-in-time inventory management makes sure raw materials are ordered just when they are needed rather than weeks (or months) in advance, thus reducing inprocess inventory and the associated carrying costs And this method is suitable for a manufacturing company as Son Ha International Corporation However, managing inventory is not as really simple as we are talking about It requires a deep understanding about the company‟s business, the competitive market, the opponents and the management methods What company should now is to reduce the levels of inventories, try to boost sales and only hold more inventories that are interested by many customers This will help the company to reduce the inventories costs Reducing the costs of inventory does not always mean having to switch to a cheaper supplier or sacrificing quality By making systems more efficient, reliable and streamlined, a business can reduce its direct and indirect inventory costs as well as Lê Thu Uyên- CQ56.11.03CLC communicate closely with the suppliers, warehouse and fulfillment center to discuss methods for reducing costs and ask for advice on what can be done 3.3.5 Improving to use working capital effectively The company's working capital accounted for a high proportion at both the beginning and the end of the year, but the efficiency of the company's capital use (working capital and working capital) during the year decreased The reason is that the company has not used its working capital thriftily and rationally Therefore, in the coming time, it is necessary to improve the efficiency of working capital In there: - For capital by cash: From the current situation of the company in 2020, we find that the cash reserve of the Company is still unreasonable: Quick ratio at the end of the year is 0.07 times ( < ), compared with the beginning of the year decreased by 0.053 times, showing that the quick payment ability of the company is reduced The company's current cash ratio also decreased compared to the beginning of the year The amount of cash reserve at that low level is not commensurate with the scale of production and business, reducing the financial initiative of the company This is detrimental to production and business activities because cash capital is the most flexible asset, moreover, with a low amount of cash capital, the company will not be able to take advantage of business opportunities with high profits, or not get a discount trade…Thus, to ensure cash flow, company should: + Determining a reasonable level of cash reserve, which is important in helping businesses ensure the necessary cash payment in the period to avoid risks insolvency, maintaining prestige with suppliers and creating favorable conditions for + It is necessary to strictly manage cash advances, clearly define the advance case, the object of the advance and the advance term + Plan the payment period, plan cash flow, on that basis take appropriate measures to ensure the balance of cash receipts and expenditures Lê Thu Uyên- CQ56.11.03CLC - For inventory: The company needs to determine the right amount of inventory for each product type on the basis of inventory data of previous years and contracts signed with customers Reduce costs incurred such as storage costs, transportation costs, - For receivables: it is necessary to clearly stipulate in the contract the specific terms of the contract value, payment method, payment term as well as terms of breach of contract On the other hand, it is necessary to urge promote the collection of debts of the company 3.1.1 Other solution to improve working capital management - Investing to advanced technology The company must pay attention to improving the production process, looking for new production technologies towards the development of diversified products This helps the company to increase productivity, product quality to be competitive in the market, accelerate the consumption of goods and especially create prestige of customers - Improving human resources department + Supplementing the shortage of human resources, developing human resources through recruitment or training to create motivation for development, hiring more experienced staff + Improving the management and administration capacity of the management a modern human resource management model whereby the rights and responsibilities of each management unit are clearly delineated, ensuring the creativity and initiative of each member with the whole system through business targets + Improve the qualifications of both employees by: Regularly organizing training to improve the qualifications of employees, and at the same time organizing refresher courses to raise awareness of management, production ability, management level… for employees in the company Lê Thu Uyên- CQ56.11.03CLC 3.3 Conditions for implementing solutions 3.3.1 Conditions of State - Conditions of Goverment The State needs to create a favorable environment for business activities, simplify administrative procedures, and save time and money for businesses It is necessary to further innovate macroeconomic policies, ensuring the orientation to create conditions for businesses to develop The policy must aim at stability and sustainable development, creating an attractive and competitive environment for investors At the same time, the state needs to have clear policies in the period of economic fluctuations in prices, inflation, interest rates, exchange rates so that businesses can operate with peace of mind Further strengthen the role of organizations, associations and unions and adopt policies to encourage businesses and individuals with excellent achievements, creating motivation for development - Conditions of Congress A comply legal system of the State plays a very important role, it is a condition for creating a stable and developing economy, making it easy for businesses to improve their financial capacity in the current situation - Conditions of State Bank Strengthening the role of controlling the economy through credit analysis reports, monitoring the financial situation of commercial banks about factories with bank accounts The banking system also needs to be improved, diversify operations, and prepare all necessary conditions to become a truly effective financial intermediary in the stock market Lê Thu Uyên- CQ56.11.03CLC 3.2.2 Conditions of Company The company needs to provide accounting software solutions, allowing to improve the efficiency of financial and accounting activities of the Company as well as apply new information technology to the management of the company The company needs to take measures to adjust and supplement human resource, advise the director in the process of searching and signing contracts, so that the company can have more revenue, increase profits, ensure sustainable development To be able to improve the business performance of the company The company should have a department in charge of debt management and debt monitoring, especially specific to each customer and debt value Lê Thu Uyên- CQ56.11.03CLC CONCLUSION Well-managed working capital is crucial to the running of a healthy and successful business No business can run successfully without an adequate amount of working capital because it is regarded as the blood of the enterprise Being in the manufacturing sector, Hanoi 40 Joint Stock Company has always understood the importance of working capital efficiency in its development process In recent years the company always pays attention on improving the efficiency of working capital management The prestige of the company has been insisting on the market Revenue, profits grow steadily over the years, the remuneration of officers and staff is constantly improved and enhanced However, besides achievements, the company still has some limitations in the working capital management Deriving from the actual situation in the company and the knowledge learning from university, I made the research on the working capital management efficiency of the company Thereby, I boldly proposed some solutions to improve the efficiency of working capital at Hanoi 40 Garment Joint Stock Company However, improvement of working capital management efficiency is a complex problem It needs investigating deeply and approaching realistically So during internship and writing this essay, mistakes are unavoidable I look forward to receiving valuable contribution from the lecturers and other readers Lê Thu Uyên- CQ56.11.03CLC REFERENCES Corporate Finance Syllabus, copyright © 2010 Academy of Finance, Chief author PhD Nguyen Trong Co Corporate Finance Syllabus, copyright © 2014 Academy of Finance, Chief author PhD Vu Van Ninh Financial Statement of Hanoi 40 Garment Joint Stock Company Documents collected from department of 40 Garment Joint Stock Company Lê Thu Uyên- CQ56.11.03CLC