Liquidity

PrepNuggets

In corporate context, the ability of a company in meeting its short-term obligations. Such obligations include payments to vendors and suppliers, including staff salary and rent, interest payments to creditors, and repayment of debt that is due soon.  

Liquidity management refers to the processes of a company to meet its liquidity needs.  This is especially crucial for companies which are in tighter financial situations to ensure firm solvency.