The determinants of working capital management of selected publicly listed companies from 2000 t0 2006

• Main Authors: Ang, Katherina Carl N., Clemente, J. Samson L., Reyes, Bea Cristina C.
• Format: text
• Language: English
• Published: Animo Repository 2007
• Subjects: Capital > Management; Business enterprises Finance; Finance and Financial Management
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/5715
• Institution: De La Salle University

The paper was conducted to study the management of working capital using internal and external determinants. The determinants are business indicator and industry effect as external factors and debt ratio, operating cash flow, growth, firm performance and firm size for the internal factor. To see the effects of these determinants on working capital management, the proxies employed in the study were Net Liquid Balance (NLB) and Working Capital Requirements (WCR). Out of the 241 listed companies in Philippine Stock Exchange, only 137 companies were used to conduct the study. The study was subject to the availability of financial statements for the entire timeframe covered (2000-2006). Results of this study partially proved some of the hypotheses constructed to be true. Results showed that AGE and SALES have an effect on Net Liquid Balance while GDP and OCF have on Working Capital Requirement. But among the determinants tested none showed a significant effect on both Working Capital Requirement and Net Liquid Balance as hypothesized (although there was a partial significance for industry effect the financials sector showed positive significance with both proxies while the hypothesized relationship of firm size held true for Working Capital Requirement but not Net Liquid Balance).