IDEAS home Printed from https://ideas.repec.org/a/rnd/arimbr/v7y2015i3id422.html

Working Capital, Financing Constraints and Firm Financial Performance in GCC Countries

Author

Listed:
  • Sree Rama Murthy Y

Abstract

This paper looks at the impact of level of working capital on a firm’s financial performance of 153 large manufacturing firms operating in the six Gulf Cooperation Council Countries (GCC).Three hypotheses being tested in the paper are that working capital levels and inventory levels have a negative impact on corporate financial performance, have a positive impact on corporate financial performance, or that there is no empirically provable relationship between working capital and inventory and financial performance. A number of control variables including firm size, gross margins, and age of the firm are used in the regression analysis, as financial performance is not purely dependent on working capital and inventory levels. Pre-tax return on assets (ROA-profit before tax divided by total assets) is used to measure corporate financial performance. Performance is strongly influenced by levels of accounts receivables; however inventory levels and payables have no impact on performance.

Suggested Citation

  • Sree Rama Murthy Y, 2015. "Working Capital, Financing Constraints and Firm Financial Performance in GCC Countries," Information Management and Business Review, AMH International, vol. 7(3), pages 59-64, June.
    • Handle: RePEc:rnd:arimbr:v:7:y:2015:i:3:id:422
    DOI: 10.22610/imbr.v7i3.1154
    as

    Download full text from publisher

    File URL: https://amhinternational.com/imbr/article/view/422-working-capital-financing-constraints-and-firm-financial-performance-in-gcc-countries
    File Function: Abstract page
    Download Restriction: no
    File URL: https://amhinternational.com/imbr/article/download/422-working-capital-financing-constraints-and-firm-financial-performance-in-gcc-countries/95bf652d-c122-448d-8a37-f9d99d75ad6d
    File Function: Full text
    Download Restriction: no
    File URL: https://libkey.io/10.22610/imbr.v7i3.1154?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rnd:arimbr:v:7:y:2015:i:3:id:422. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AMH International (email available below). General contact details of provider: https://amhinternational.com/imbr .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.