ABSTRACT
The study investigated effect of working capital management on performance of firms in Nigeria It extracted secondary data obtained from annual reports of selected quoted manufacturing firms listed in the Nigeria stock Exchange within theperiod 2010to2016. The study used expost facto research design to ascertain the relationship of the variables and employed gross working capital, networking capital, and acid test ratio as collective proxies for working capital management while profit after tax,return on assets and return on equity was adopted as proxies for performance in 3 distinct models. The study adopted panel least squares method of data estimation based on the crosssection and time series data employed to determine whether working capital management affects performance of quoted firms in Nigeria. It was established that83.7% of the total variation on profit after taxis attributable to working capital management. It was established that working capital management has no significant effect on return on equity while it has significant effect on return on assets and profit after tax. The study, therefore, concludes thatworking capital management has significant effect on performance of quoted firms inNigeria.It therefore recommends that firms should efficiently manage their current assets and acid test ratio to enhance the profit level, management of firms should ensure that the current assets are efficiently and effectively managed to ensure return to shareholders and firms should ensure that their inventories are well utilized to meet business operations in a way that would generate more profits.
TABLE OF CONTENTS
CHAPTER ONE: INTRODUCTION
1.1 Background to the Study1
1.2 Statement of the Problem 4
1.3 Objectives of the Study5
1.4 Research Questions 6
1.5 Statement of Hypotheses6
1.6 Significance of the Study 7
1.7 Scope of the Study7
1.8 Limitations of the Study 8
CHAPTER TWO:REVIEW OF RELATED LITERATURE
2.1Conceptual Framework 9
2.1.1Concepts of Working Capital 10
2.1.2Concept of Performance 11
2.1.3 Determinants ofWorking Capital 12
2.1.4 InventoryManagement15
2.1.5AccountReceivable Management 18
2.1.6 CashManagement19
2.1.7 AccountPayableManagement 21
2.1.8 Measurement of working CapitalManagement 22
2.1.9 WorkingCapitalPolicy 27
2.2 Theoretical Framework: 30
2.2.1 Operating CycleTheory 34
2.2.2 Resources BasedTheory 35
2.3 Empirical Review 35
2.3.1 SummaryofEmpirical Review 45
2.4 SummaryofLiterature Review 54
CHAPTERTHREE:METHODOLOGY
3.1 ResearchDesign 55
3.2 AreaoftheStudy 55
3.3 MethodofDataCollection 55
3.4 ValidityandReliability oftheData 56
3.5 DataAnalysis Technique 56
3.6 ModelSpecification 56
3.7 DecisionRule 58
CHAPTER FOUR: DATA PRESENTATION, ANALYSIS AND DISCUSSION OF RESULTS
4.1 Presentation of data 5
4.2Analysis and Discussion of unit root results60
4.3 Analysis and discussion of results 62
4.3.1Effectofworking capital management on profit after tax 62
4.3.2Effectofworkingcapitalmanagement on return on equity 69
4.3.3Effectofworking capital management on return on assets 75
4.4 Hypotheses Testing80
CHAPTER FIVE: SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS
5.1 SummaryofFindings 83
5.2 Conclusion 85
5.3 Recommendations86
REFERENCES
APPENDIX A
APPENDIXB
DAVID, I (2021). Effect Of Working Capital Management On Performance Of Firms In Nigeria (A Study Of Selected Quoted Firms). Mouau.afribary.org: Retrieved Oct 30, 2024, from https://repository.mouau.edu.ng/work/view/effect-of-working-capital-management-on-performance-of-firms-in-nigeria-a-study-of-selected-quoted-firms-7-2
IJEOMA, DAVID. "Effect Of Working Capital Management On Performance Of Firms In Nigeria (A Study Of Selected Quoted Firms)" Mouau.afribary.org. Mouau.afribary.org, 23 Feb. 2021, https://repository.mouau.edu.ng/work/view/effect-of-working-capital-management-on-performance-of-firms-in-nigeria-a-study-of-selected-quoted-firms-7-2. Accessed 30 Oct. 2024.
IJEOMA, DAVID. "Effect Of Working Capital Management On Performance Of Firms In Nigeria (A Study Of Selected Quoted Firms)". Mouau.afribary.org, Mouau.afribary.org, 23 Feb. 2021. Web. 30 Oct. 2024. < https://repository.mouau.edu.ng/work/view/effect-of-working-capital-management-on-performance-of-firms-in-nigeria-a-study-of-selected-quoted-firms-7-2 >.
IJEOMA, DAVID. "Effect Of Working Capital Management On Performance Of Firms In Nigeria (A Study Of Selected Quoted Firms)" Mouau.afribary.org (2021). Accessed 30 Oct. 2024. https://repository.mouau.edu.ng/work/view/effect-of-working-capital-management-on-performance-of-firms-in-nigeria-a-study-of-selected-quoted-firms-7-2