EFFECT OF WORKING CAPITAL MANAGEMENT ON THE FINANCIALPERFORMANCE OF LISTED CONSUMER GOODS FIRM, IN NIGERIA
Abstract
This study examined the effect ofWorking Capital Management on the Financial PerformanceoflistedConsumergoodsfirmsinNigeriaovera10-yearperiod(2014-2023).Theresearchdesign usedinthisstudyisex-postfactoresearchdesigns.Toaccomplishtheresearchobjectives,thestudyutilizedthreeworkingcapitalmanagementproxies - AccountReceivable (AR), Cash Conversion Cycle (CCC), andAccountPayable (AP) - as the independent variable, andReturn on Asset (ROA) asaproxyforfinancialperformance, servingasthedependentvariable. Theanalysis employedpaneldataandmultipleregressiontechniques,facilitatedbyE-views10 software,to examinetherelationshipsbetweenthevariables.TheanalysisshowedthatAccountReceivable (AR),CashConversionCycle(CCC),and Account Payable(AP)haveasubstantialand robustpositive impact on theReturn onAsset (ROA) of consumergoods companies inNigeria, indicatingastrongcorrelationbetweeneffectiveworkingcapitalmanagementandimprovedfinancial performanceinthe sector.Thefindings suggestthat Nigerianconsumer goodsfirmscanbenefitfromamorecomprehensiveapproachtoworkingcapitalmanagement,incorporatingmultiplemeasurestoensureimprovedfinancial performanceandinternalcontrol.Thestudytherefore recommends thatcompaniesshouldprioritize effectivemanagementof their cash conversion cycle,including inventory and receivables, as a deliberate approach to lengthening the cycle is linked toincreasedprofitability, asmeasuredbyReturnonAssets(ROA).
Keywords:Workingcapitalmanagement,financialperformance,Consumerg
Full-Text Access Notice
In accordance with the NERD Policy on promoting peer-reviewed publication, public access to the full text of a project, thesis or dissertation is restricted for three years, allowing the author and supervisors sufficient time to pursue peer-reviewed publication.
During this period, researchers with legitimate academic or research purposes may request authorisation directly from the author to enable NERD to release the indexed full texts of the work using the form below.