What is Core Capital Asset as firstly pointed out by Tondons Committee for Financing of Working capital?
2. What is the difference between Permanent Working Capital and Core Capital Asset? 3. How to calculate Core capital Asset when Maximum Permissible Bank Finance is also not available? Posted By: Sachidanand Singh On: 13/04/2009 16:51:18 By its nature working capital assets get transformed with time. Raw material changes into goods in process, then in finished goods, then in receivables and finally in cash. This cash to cash cycle is called working capital cycle. Tandon Committee (incidentally Mr Tandon, a CA, was the first Indian CEO of Hindustan Lever, now Hindustan Unilever) was appointed by RBI in early seventies to devise a mechanism for allocating bank’s lendable resources equitably among various industries. (Those days bank finance was a scarce commodity) The essence of TC’s recommendations was that a certain part of the working capital needs must come from long term sources. As most borrowers were lax, relying overly on bank finance TC made graded recommendations giving three me
