“The Effect Of Working Capital Management On Financial Performance Of Selected Industrial Goods Companies In Nigeria:- Ezechukwu Chizobam F

ABSTRACT

In Nigeria, many local, industries are operating under harsh conditions such as lack ofaccess to fund and high interest rates on bank loans. This study is to examine the effect ofworking capital management on financial performance ofIndustrial goods companies in Nigeria. The study employs Expost research design andsecondary data. The study tends to determine the extent of accounts receivable ratio (ARR) and accounts payable ratio (APR) affect return on Assets(ROA) ofNigerian industrial goods companies? And How does accounts receivable ratio (ARR) and accounts pavable ratio (APR) affect Return on equity (ROE) of Nigerian industrial goods companies?. The study employs Pecking Order theory ofliquidity, Trade offTheory of Liquidity and Working Capital Cycle Theory The area of the study cover 13 manufacturingfirms on NSE. Secondary source ofdata was used and anlysed using SPSS version 20. The findings of the study concludes that for Berger Paints ltd, Dangote Cement and beta glass, working capital has a positive and significant impact on performance of industrial companies in Nigeria. The study recommended that Much attention should be paid to cost ofsales to ensure that it will not negatively affect prices of stock and they should exhibit carefulness in handling of stock/investors at least to ensure that their stock level will not be below the minimum stock level.