Balance sheet

Another feature in the restructured balance sheet which makes it different from a regular balance sheet is that of financing and investment activities. Cash receivables, inventory, and supplementaries constitute the short term investments for the current assets. On the other hand, account payable, current debt due to creditors, and supplementary accrued liabilities constitutes the short term financing for the current liabilities. So that in cases when the difference between the two is a negative value, then there exist a deficit. This deficit is usually funded by long-term sources of long-term investments in working capital to avoid company demise (Jablonsky & Basrsky, 2001).

Along the premise that a minimal long-term source of long-term investments in working capital is required to cover deficits, Wal-Mart financial managers must have decided to lessen the working capital, such that in 2000 $1.447 billion was allocated for it instead of the $1.867 billion which was allocated working capital in 1990.