Acting as the initial cushion of liquidity and the partial rationales for the degree of financial leverage, working capital management explicitly demonstrates material influences on the decision making of executives, especially for the emerging markets, which are featured as the financial mechanisms with insufficient and immature capital flows. The study explores the importance and contributions of working capital management in the case of Thailand, which represents one of the typical emerging markets, by employing 104 listed companies in three different sectors covering the period of year 2002 to 2011 on a quarterly basis, through the incorporation of, working capital management ratios, leverage ratios, and profitability ratios. It results that, the inventory and credit management do contribute to the efficiency of working capital management and therefore impact the basic earning power, rather than financial leverage and profitability.

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