# Working capital peg

**Working capital peg:** A working capital peg is the target level of net working capital a practice must deliver at closing, with the purchase price adjusted up or down for any difference.

A working capital peg is the target level of net working capital a practice must deliver at closing, with the purchase price adjusted up or down for any difference.

It prevents a seller from drawing down the practice’s working capital before closing. Have a CPA review how a peg is set.

Source: DDSIntel glossary, https://ddsintel.com/glossary/working-capital-peg

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