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Practices of working capital policy and performance assessment financial ratios and their relationship with organization performance

Author

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  • Niazi, Ghulam Shabbir Khan
  • Hunjra, Ahmed Imran
  • Rashid, Majid
  • Akbar, Syed Waqar
  • Akhtar, Muhammad Naeem

Abstract

The purpose this study is to highlight the application of working capital policy and the performance assessment financial ratios and to determine their relationship with organization performance. The target respondents were the finance executives/financial analysts of the companies. 64 properly filled questionnaires were processed for analysis. This study concludes that the finance executives consider that the proper practices of working capital and financial ratios are very important for the growth and performance of the organization. This research study also finds that there is positive and significant relationship between these practices and organization performance.

Suggested Citation

  • Niazi, Ghulam Shabbir Khan & Hunjra, Ahmed Imran & Rashid, Majid & Akbar, Syed Waqar & Akhtar, Muhammad Naeem, 2010. "Practices of working capital policy and performance assessment financial ratios and their relationship with organization performance," MPRA Paper 40659, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:40659
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    File URL: https://mpra.ub.uni-muenchen.de/40659/1/MPRA_paper_40659.pdf
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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. Rajan, Raghuram & Zingales, Luigi, 2003. "Banks and Markets: the Changing Character of European Finance," CEPR Discussion Papers 3865, C.E.P.R. Discussion Papers.
    3. Abdul K. M. Azhar & Robert J. R. Elliott, 2006. "On the Measurement of Product Quality in Intra-Industry Trade," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 142(3), pages 476-495, October.
    4. George Soros, 1999. "The International Financial Crisis," Challenge, Taylor & Francis Journals, vol. 42(2), pages 58-76, March.
    5. Anna‐Maija Lantto & Petri Sahlström, 2009. "Impact of International Financial Reporting Standard adoption on key financial ratios," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 49(2), pages 341-361, June.
    6. Abagail McWilliams & Donald Siegel, 2000. "Corporate social responsibility and financial performance: correlation or misspecification?," Strategic Management Journal, Wiley Blackwell, vol. 21(5), pages 603-609, May.
    7. 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.
    8. Butt, Babar Zaheer & Hunjra, Ahmed Imran & Rehman, Kashif-Ur-, 2010. "Financial management practices and their impact on organizational performance," MPRA Paper 32685, University Library of Munich, Germany.
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    More about this item

    Keywords

    Working capital policy; financial ratios; corporate sector; organization performance; significant relationship;
    All these keywords.

    JEL classification:

    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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