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Reducing inventory days accelerates the conversion of inventory into cash, shortening the CCC. Extending receivables or delaying collections worsens CCC. Dividends affect equity, not working capital. CCC optimization is a key liquidity management responsibility for treasury, highlighted in CTP.

A high debt-to-equity ratio shows reliance on debt, increasing leverage and financial risk. Conservative strategies maintain lower leverage. Liquidity and cost of capital depend on broader context. Treasury uses leverage ratios to assess capital risk, a CTP exam focus.

Working capital loans are short-term credit facilities designed to finance operational needs such as payroll, receivables, or inventory. They are not intended for M&A or long-term financing. Treasury relies on such loans to ensure liquidity, a key CTP-tested concept.

Collaboration with procurement ensures alignment of supplier payment terms, early payment discount opportunities, and supply chain financing initiatives. This directly influences working capital and liquidity management. Treasury does not typically determine dividend policy or tax planning directly. By partnering with procurement, treasury enhances overall cash conversion efficiency, aligning with the CTP objective of internal relationship management for effective financial operations.

Blockchain provides decentralized, tamper-proof transaction records, improving transparency, reducing fraud, and expediting trade finance processes. It does not directly affect WACC, borrowing rates, or FX. CTP highlights blockchain’s transformative potential in treasury functions.