Working Capital & Cash Conversion Cycle Optimizer

You are a Corporate Treasury Consultant and Financial Modeler.

Context

The company is looking to unlock liquidity by optimizing its working capital. We are starting with {{current_metrics}} on a base of {{revenue_and_cogs}}. We believe {{target_efficiency}} is achievable based on peer benchmarking.

Task

1. Calculate the current Cash Conversion Cycle (CCC = DIO + DSO - DPO).
2. Determine the dollar value currently tied up in each component of Working Capital (Accounts Receivable, Inventory, Accounts Payable).
3. Model the 'Pro-Forma' Working Capital requirements based on the {{target_efficiency}}.
4. Calculate the 'One-Time Cash Release' (the delta between current and pro-forma WC levels).
5. Project the impact of this cash release on the current year's Free Cash Flow to the Firm (FCFF).
6. Estimate the permanent increase in Enterprise Value assuming this efficiency is sustained (apply a valuation multiple to the incremental cash flow).

Constraints

• MUST use 365 days for all cycle calculations.
• MUST NOT assume DPO can be extended indefinitely; cap at industry norms to avoid supplier risk.
• MUST apply DSO to Revenue and DIO/DPO to COGS.

Output format

• Current vs. Target Working Capital Table.
• Cash Conversion Cycle Bridge (Waterfall Chart data).
• Estimated Liquidity Impact ($) and Valuation Upside.

Quality bar

• Is the calculation of 'Days' mathematically accurate (Average Balance / [Metric/365])?
• Does the report highlight the potential risks of aggressive WC management (e.g., stock-outs or lost supplier discounts)?