World Research of Business Administration Journal
Vol.1 No.1 November 2021
DOI https://www.doi.org/10.56830/WRBA11202101
Authors
Heba Srour
Marwa El Maghawry
Abstract
The primary purpose of working capital management is to enable the company to
maintain sufficient cash flow to meet its short-term operating costs and short-term
debt obligations. This is achieved by the effective management of accounts payable,
accounts receivable, inventory and cash. The major aim of this study is to examine
the effect of working capital management which will be measured by the efficiency
of cash management, efficiency of receivables management, and efficiency of
inventory management, on firm’s performance that will be measured using the
growth in total assets, growth in total sales, as well as the growth in net profit. The
data was collected from 6 companies that were listed in the Egyptian stock
exchange market from year 2016 to 2020. The analysis of this study was done using
(EViews 12) for both descriptive statistics and multiple regressions. The study
found that there is a negative correlation between the efficiency of receivables
management and the inventory management. While the results of this study
indicated that there is an overall positive correlation between working capital
management and firm’s financial performance at the 5% level with a probability of
0.0000.
Keywords: Working Capital Management – Receivables Management – Inventory
Management – Cash Management – Firm Performance and profitability.
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