WORKING CAPITAL MANAGEMENT AND EXTENT OF INFLUENCE ON PUBLIC LISTED FIRMS’ PERFORMANCE IN INDUSTRIAL PRODUCT INDUSTRY

Sim, Siew-Ling and Ali, Azlan WORKING CAPITAL MANAGEMENT AND EXTENT OF INFLUENCE ON PUBLIC LISTED FIRMS’ PERFORMANCE IN INDUSTRIAL PRODUCT INDUSTRY. The Asian Journal of Professional and Business Studies, 1 (1). ISSN 2716-666X

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Abstract

Due to the turbulent global environment, an effective working capital management has accentuated ever since the manifestation of global financial crisis wherein the eventuality of the unforeseen plight is immensely affecting both firms’ profitability and liquidity risk. The purpose of this study is to examine the influence of working capital management on firm performance, likewise furnishing insight on the pertinence of the theories that are applicable to exemplify the management of short-term resources in a firm. This study adopts dynamic panel data methodology, one-step system generalised method of moments (GMM) to capture for the endogeneity issues arising from the unobserved time-invariant firm-specific elements as well enhance the data efficiency. Adopting a sample of 156 Malaysian public companies listed on bursa Malaysia in industrial products economy sector with the time period of 10 years (i.e. from 2007 through 2016), the researcher discovers evidence as follows: the coefficient results implying significant negative linkage between working capital proxy (i.e. ccc) and firm performance indicators. The firm size has been signified as a remarkable control variable that might affect firm profitability as well as firm market valuation due to the competitive edges that could gain through economies of scales. The novelty verdict endeavours to accommodate intuitions for finance managers as well prospective investors in envisaging the momentous of working capital management in trading-off liquidity and returns, particularly in the region of emerging countries such as Malaysia

Item Type:	Article
Uncontrolled Keywords:	Working Capital Management (WCM), Firm Performance; Industrial Product Industry, Dynamic Generalised Method of Moments (GMM
Subjects:	L Education > L Education (General) L Education > LC Special aspects of education L Education > LC Special aspects of education > LC5201 Education extension. Adult education. Continuing education
Divisions:	Faculty of Business, Accountancy and Social Sciences
Depositing User:	Mrs Shariffah Shuhaiza Syed Mohd Nor
Date Deposited:	18 Jun 2021 02:48
Last Modified:	17 Aug 2021 04:38
URI:	http://eprints.kuptm.edu.my/id/eprint/1781

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