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managing liquidity

Managing Liquidity in turbulent times

Managing liquidity in Turbulent Times

In the current market environment, companies are enduring challenges in meeting their debt obligations. A structured coordinated response is the best path to success in such conditions.

Factors impacting businesses in Bahrain

  • Economic downturn and COVID-19 has impacted most of the key business segments adversely and exacerbated the already existing stress in the economy.
  • Typical business models were largely trade finance dependent or working capital intensive.
  • As businesses face challenges in recovering outstanding receivables in a timely manner, the working capital positions are being stretched.
  • This is coupled with declining revenues, margin erosion and a fundamental change in consumer behavior.

These factors are leading to:

  • Stressed balance sheets
  • Unproductive assets
  • Long working capital cycles
  • Default in debt payments
  • Delay in payments (both operational and financing)
  • Cash flow issues

Organizations that do not face these challenges head on, understand the options and manage critical stakeholders, run the risk of financial impairment and potential business failure.

 

 

managing liquidity

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