THE WORK CAPITAL OF INVESTMENT PROJECTS

Abstract

The model IKT for new projects is relevant to calculate the investment in working capital in new companies minimizing the risk of bankruptcy by preventing deficits in the operating cash flow resulting in their closure in a high percentage before their reach the first year. The model IKT was built as an alternative for the issues identified when evaluating the new companies that were created with the Fondo Emprender which a fund is supported by the Colombian Government. This fund assists with the foundation of the new companies and between the periods of 2005 and 2017, 44, 79% of the initiatives had to be closed, mainly due to the cash flow deficit. The research follows an evaluative method applying the logit model which verifies the entrepreneurship capacity in Colombia as a result of the ratio between the risk of closure and new companies. Evaluating the investment projects and the use of a formulation method had to be applied to elaborate the model. The research findings indicate inappropriate to determine the working capital in new companies with the same method applied in operating companies. Furthermore, establish the importance of estimating the working capital by selecting dynamic variables such as costs variance and fixed monthly costs and considering the fixed monthly cost in relation to the number of months that each company will need to reach the break-even point.