Problem
Elegant Fumitures Limited owner, Mr. TK Haraka has been struggling in paying his employee's salaries for the last 6 months. He does not understand why, yet the goods in his furniture shop have been selling fast. He starts to suspect that his staff could be stealing from him, and he is on the verge of dismissing most of them or even close the shop. You meet him during a common friend's function, and you get discussing various things when he mentions to you his current situation. You ask him to share his financial records to see where the challenge could be coming from, and if the staff are stealing from the shop. Upon analysis of the books, you realize that the business has a huge accounts receivable amount, high levels of stock yet the firm has been very prompt in accounts payable clearance and thus has a huge bank overdraft which is spent on payment of salaries and wages. Advice TK Haraka on how to get rid of the working capital challenges.