Working Capital Management And Profitability: A Case Of Alba County Companies

Dănulețiu, Adina Elena

doi:10.29302/oeconomica.2010.12.1.36

Cited by 13 publications

(1 citation statement)

References 3 publications

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“…Dănuleţiu [4] analyzed the efficiency of working capital management of companies from Alba County. The relation between the efficiency of the working capital management and profitability is examined using Pearson correlation analyses and using a sample of 20 annual financial statements of companies covering period 2004-2008.…”

Section: Literature Reviewmentioning

confidence: 99%

The Relationship between Working Capital Management and Profitability: Evidence from Saudi Cement Companies

Almazari

2014

BJEMT

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Aims: This paper investigated the relationship between the working capital management (WCM) and the firms' profitability for the Saudi cement manufacturing companies. Methodology: There are 13 Saudi cement manufacturing companies operating in the market. Only eight companies were included which are listed in the Saudi stock exchange market (Tadawul) and were established before the year 2005, and the rest were excluded for the period of 5 years from 2008-2012. Results:The study results showed that, Saudi cement industry current ratio is the most important liquidity measure which effected profitability, therefore, the cement firms must set a trade-off between these two objectives so that, neither the liquidity nor profitability suffers. It was also found, as the size of a firm increases, profitability increased. Besides, when the debt financing increased, profitability declined. Linear regression tests confirmed a high degree of association between the working capital management and profitability. Conclusion:The Saudi cement firms could strengthened their working capital in more efficient ways by adopting more advanced financial devices which will help them to manage cash, accounts receivables and inventories, and will ultimately increase their profitability. There is much to be done about working capital in Saudi Arabia in future.

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Section: Literature Reviewmentioning

confidence: 99%

The Relationship between Working Capital Management and Profitability: Evidence from Saudi Cement Companies

Almazari

2014

BJEMT

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Working capital management: a literature review and research agenda

Singh

Kumar

2014

Qualitative Research in Financial Markets

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Purpose – The purpose of this paper is to review research on working capital management (WCM) and to identify gaps in the current body of knowledge, which justify future research directions. WCM has attracted serious research attention in the recent past, especially after the financial crisis of 2008. Design/methodology/approach – Using systematic literature review (SLR) method, the present study reviews 126 articles from referred journal and international conferences published on WCM. Findings – Detailed content analysis reveals that most of the research work is empirical and focuses mainly on two aspects, impact of working capital on profitability of firm and working capital practices. Major research work has concluded that WCM is essential for corporate profitability. The major issues with prior literature are lack of survey-based approach and lack of systematic theory development study, which opens all new areas for future research. The future research directions proposed in this paper may help develop a greater understanding of determinants and practices of WCM. Practical implications – Till date, literature on classification of WCM has been almost non-existent. This paper reviews a large number of articles on WCM and provides a classification scheme in to various categories. Subsequently, various emerging trends in the field of WCM are identified to help researchers specifying gaps in the literature and direct research efforts. Originality/value – This paper contains a comprehensive listing of publications on the WCM and their classification according to various attributes. The paper will be useful to researchers, finance professionals and others concerned with WCM to understand the importance of WCM. To the best of the authors’ knowledge, no detailed SLR on this topic has previously been published in academic journals.

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Working Capital Management and its Affect on firm’s Profitability and Liquidity : in other Food Sector of ( KSE ) Karachi Stock Exchange

Usama¹

2012

AJBMR

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This paper aims to extend the Rehman and Nasr finding regarding Working capital management and its affect on profitability and liquidity of Pakistani firms. For the purpose of our analyses we have been selected the other food sector and selected the data from 2006-2010 of 18 companies of this sector listed on Karachi Stock Exchange. For this purpose we examine the effect of different variables of working capital management like Average collection period, average payment period, inventory turnover in days, cash conversion cycle, debt ratio, financial asset to total asset ratio, current ratio and net operating profitability. We have used pooled least square regression and common effect model. We found that there is significant positive affect of working capital management on profitability and liquidity of the firms. Size of the firm and financial asset to total asset ratio have significant positive effect on firm's profitability while average collection period has significant negative effect on firm's profitability. Size of firm and cash conversion cycle has significant positive effect on firm's liquidity.

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Working Capital Management And Profitability: A Case Of Alba County Companies

Cited by 13 publications

References 3 publications

The Relationship between Working Capital Management and Profitability: Evidence from Saudi Cement Companies

The Relationship between Working Capital Management and Profitability: Evidence from Saudi Cement Companies

Working capital management: a literature review and research agenda

Working Capital Management and its Affect on firm’s Profitability and Liquidity : in other Food Sector of ( KSE ) Karachi Stock Exchange

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