INEFFICIENT WORKING CAPITAL MANAGEMENT AND ITS IMPLICATION OF OIL AND GAS MARKETING FIRM IN NIGERIA

This research study examines inefficient working capital management and its implication on the performance of oil and gas marketing firms in Nigeria. The study identifies inventory turnover ratio and account receivables turnover ratio as critical working capital indicators and examines their influence on return on capital employed, gross profit margin, and operating ratio. Data were collected from the audited financial statements of 10 oil and gas marketing firms (5 major and 5 independent) covering the period 2008–2017. Using financial ratio analysis, regression, and correlation, the findings revealed that inefficient working capital practices have a negative impact on firm performance. Specifically, poor inventory management and delayed receivable collection reduced profitability and increased operational costs. The study concludes that effective working capital management is crucial for the profitability and survival of oil and gas firms in Nigeria. It recommends that firms improve their inventory controls, enhance credit policies, and automate their financial operations to ensure a balanced approach between liquidity and profitability..