WCM component importance ranking order by SMEs: financial directors perspective

Afrifa, G. (2014) WCM component importance ranking order by SMEs: financial directors perspective. International Journal of Current Research, 6 (1). pp. 631-4639. ISSN 0975-833X.

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Abstract

This paper reports the results of an investigation into the ranking order of Working Capital Management (WCM) components of Small and Medium Enterprises (SMEs) listed on the Alternative Investment Market (AIM), from the perspective of financial directors. The analyses are based on
questionnaire distributed to 248 AIM listed SMEs. The paper employs the one-way ANOVA and post hoc test on responses from 72 managers of AIM listed SMEs. The results show differences in the importance of each component of WCM. First, inventory holding period importance is shown to differ from that of accounts receivable period, accounts payable period and cash conversion cycle. The results also show that accounts receivable period importance is different from accounts payable period
and cash conversion cycle. However, there is no difference of importance between accounts payable period and cash conversion cycle. In terms of ranking order, accounts receivable period is ranked first, leading to the conclusion that given the limited resources of SMEs, they need to prioritise their WCM by focusing on accounts receivable period to improve profitability.

Item Type: Article
Subjects: H Social Sciences > HF Commerce > HF5001 Business
H Social Sciences > HG Finance
Divisions: Faculty of Social and Applied Sciences > The Business School
Related URLs:
Depositing User: Dr Godfred Afrifa
Date Deposited: 10 Jun 2015 15:38
Last Modified: 23 Jan 2016 06:28
URI: https://create.canterbury.ac.uk/id/eprint/12814

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Last edited: 29/06/2016 12:23:00