What are Operating Current Assets?

Operating current assets are those short-term assets used to support the operations of a business. In most organizations, the key operating current assets are cash, accounts receivable, and inventory. Short-term assets that relate more to financing issues, such as marketable securities and assets held for sale, are not considered part of operating current assets.

Other types of operating assets are long-term in nature, and typically comprise a much larger investment for a business than its operating current assets. This is particularly common in a production-intensive environment, where the investment in fixed assets can greatly exceed the investment in operating current assets. Such is also the case where the investment in intellectual property or natural resources comprise the primary source of corporate value. However, a services business may have most of its assets invested in operating current assets, since there may be little need for investments in other types of assets.

Presentation of Operating Current Assets

An organization’s operating current assets are listed near the top of its balance sheet, within the current assets section. Several examples of operating current assets are shown in the following exhibit, which contains a complete balance sheet.