y to reflect business conditions. This study examines the role business cycle plays in the working capital-corporate profitability relationship using a sample of Finnish panies from years 1990 to 2008. We utilize the cash conversion cycle (CCC), defined as the length of time between pany's expenditure for the procurement of raw materials and the collection of sales of finished goods, as our measure of working capital. We further make use of 2 measures of profitability, return on assets and gross operating e. We document a negative relationship between cash conversion cycle and corporate profitability. Our results also show panies can achieve higher profitability levels by managing inventories efficiently and lowering accounts receivable collection times. Furthermore shorter account payable
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