writing

Take a company that closes the year with current assets of €59m against current liabilities of €36m. Twelve months later, the numbers are €91m and €51m. Textbook working capital has moved from €23m to €40m. The current ratio has improved from 1.64x to 1.78x. Every metric your first-year accounting course taught you says the balance … Leer más

A company can go bankrupt while its EBITDA grows. That isn’t a textbook paradox or a laboratory case: it’s the ordinary outcome whenever someone mistakes an accrual metric for the ability to actually pay wages, interest and suppliers. EBITDA does not measure cash. It measures an edited version of operating profit in which four things … Leer más