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Working Capital Management and Corporate Performance: Evidence from Indonesia

Author

Listed:
  • Kusuma Hadri

    (Islamic University of Indonesia)

  • Bachtiar Ahmad Dhiyaullatief

    (Islamic University of Indonesia)

Abstract

Purpose: The purpose of this paper is to examine the relationship between working capital management and firm performance for firms listed on the Indonesian Stock Exchange. Prior works have employed many indicators of the working capital. The results of previous studies, however, have been inconsistent. This study is an attempt to find out the best proxy of working capital in explaining firm’s performance.

Suggested Citation

  • Kusuma Hadri & Bachtiar Ahmad Dhiyaullatief, 2018. "Working Capital Management and Corporate Performance: Evidence from Indonesia," Journal of Management and Business Administration. Central Europe, Sciendo, vol. 26(2), pages 76-88, June.
    • Handle: RePEc:vrs:jmbace:v:26:y:2018:i:2:p:76-88:n:5
    DOI: 10.7206/jmba.ce.2450-7814.229
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    References listed on IDEAS

    as
    1. Marc Deloof, 2003. "Does Working Capital Management Affect Profitability of Belgian Firms?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 30(3-4), pages 573-588.
    2. Harsh Pratap Singh & Satish Kumar, 2014. "Working capital management: a literature review and research agenda," Qualitative Research in Financial Markets, Emerald Group Publishing Limited, vol. 6(2), pages 173-197, July.
    3. Bana Abuzayed, 2012. "Working capital management and firms’ performance in emerging markets: the case of Jordan," International Journal of Managerial Finance, Emerald Group Publishing Limited, vol. 8(2), pages 155-179, March.
    4. Herdjiono Irine & Sari Indah Mega, 2017. "The Effect of Corporate Governance on the Performance of a Company. Some Empirical Findings from Indonesia," Journal of Management and Business Administration. Central Europe, Sciendo, vol. 25(1), pages 33-52, March.
    5. Mobeen Ur Rehman & Naveed Anjum, 2013. "Determination of the Impact of Working Capital Management on Profitability: An Empirical Study from the Cement Sector in Pakistan," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 3(3), pages 319-332.
    6. Marc Deloof, 2003. "Does Working Capital Management Affect Profitability of Belgian Firms?," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 30(3‐4), pages 573-588, April.
    7. Mobeen Ur Rehman & NaveedAnjum, 2013. "Determination of the Impact of Working Capital Management on Profitability: An Empirical Study from the Cement Sector in Pakistan," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 3(3), pages 319-332, March.
    8. Hadri Kusuma & Ariza Ayumardani, 2016. "The Corporate Governance Efficiency And Islamic Bank Performance : An Indonesian Evidence," Polish Journal of Management Studies, Czestochowa Technical University, Department of Management, vol. 13(1), pages 111-120, June.
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    Citations

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    Cited by:

    1. Maliha Rabeta, 2020. "Working Capital Management and Firm Performance of Companies in Pharmaceuticals & Chemicals Industry of Bangladesh," International Journal of Science and Business, IJSAB International, vol. 4(8), pages 40-75.
    2. Abdul Basyith & Abid Djazuli & Fitriya Fauzi, 2021. "Does Working Capital Management Affect Profitability? Empirical Evidence from Indonesia Listed Firms," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 11(3), pages 236-251, March.
    3. Jacek Jaworski & Leszek Czerwonka, 2021. "Meta-study on the relationship between profitability and liquidity of enterprises in macroeconomic and institutional environment," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 48(2), pages 233-246, June.

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    More about this item

    Keywords

    working capital; profitability; firm’s performance;
    All these keywords.

    JEL classification:

    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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