The impact of working capital management on financial performance of Nigerian listed companies

The aim of this study is to provide an empirical evidence on the impact of working capital management on financial performance of Nigerian listed companies focusing on non-financial companies. A panel data using 226 population for the study was obtained from the Nigerian stock exchange commission (NSEC) for the period of from 2006-2011. The pooled ordinary least square (OLS) and random effects was used for testing the hypotheses of this study. Therefore, the company need to give a specific attention to the variables such as account receivable period, account payable period, and inventory holding period to improve their performance and accordingly attract the investors' attention in making investment decision. Based on the finding of regression result, shows that all variables are positively significant with firm performance except account payable period. Whereas cash conversion cycle is insignificantly related to firm performance. Therefore, the finding on working capital management in Nigeria shows that firms should effectively manage and implement their working capital and standard credit policy in order to improve firm performance.