WORKING CAPITAL MANAGEMENT AND FINANCIAL PERFORMANCE OF COMPOSITE COMPANIES IN NIGERIA
Abstract
Abstract
The study was carried out to examine the effect of working capital management on the financial performance in listed insurance companies in Nigeria. Claims ratio, Trade Receivables and Trade Payables was used to measure working capital while return on asset return on equity and return on assets was used to measure financial performunce. The study adopted Ex-post facto research design. The population of the study comprised of the 28 insurance companies in Nigeria consumer goods sector. The study focused on purposive sampling technique to select five (5) consumer goods insurance companies in Nigeria for appropriate sampling with information gathered from their respective financial statement were selected for this study for a period of 10 years (2012-2021). Panel data approach was conducted on each model using an OLS method.
return
Findings
on
revealed
asset in
in
listed
hypothesis one that working capital management has a significant effect on
inn hypothesis two that working
insurance companies in Nigeria p= 0.025458 < 0.05). It was revealed
in listed insurance companies
capital management has a significant effect on return on equity
that working capital management
in Nigeria (p=0.005207 < 0.05). Lastly hypothesis three revealed
companies
has no significant return on assets in listed insurance
concluded that
in Nigeria (p- 0.311774 > 0.05). Based on the findings of this study, it was
listed insurance
working
companies
capital management has a significant effect on financial performance in
should in Nigeria. Hence, the study recommended that insurance companies draft appropriate policies to make efficient use of their credit management policy. It was also
the collection
recommended that insurance companies of Nigeria should be more concerned about both of accounts receivables and settlement of account payables in due time.
Keywords: Trade Receivables, Trade Payables, Claims ratio, Return on assets, Return on equity, return on assets
Word count: 281
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