Correlation between the Profitability and Working Capital Practices: A Case Study in the Gulf Cooperation Council

• 발행기관: 한국유통과학회
• 저자명: Mohammed Abdul Imran KHAN Md. Shabbir ALAM Ahsan Jamil SYED
• 간행물 정보: 『The Journal of Asian Finance, Economics and Business(JAFEB)』Vol. 8 No.3, 229~235쪽, 전체 7쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 2021.03.30

영문 초록

The ability of entrepreneurs to arrange working capital is the key to maximizing the profitability of small- and medium-sized enterprises and the wealth of entrepreneurs. The study investigates the correlation between entrepreneurs’ working capital management and the profitability of SMEs listed on six Gulf Cooperation Council (GCC) stock exchanges between 2019 and 2020. The secondary data is collected from the financial statements of SMEs listed on the six GCC stock exchanges. Actual sample for the research study was a total of 136 small- and medium-sized enterprises selected using purposive sampling methods. Four research models were considered in this analysis, all ending up affecting gross profits. The selected entrepreneurial SMEs were listed on six different Gulf Cooperation Council stock exchanges during 2019–2020. The fixed financial assets ratio, financial debt ratio, and company size are used as control variables and data were analyzed using multiple regression. The research results demonstrate that there is a statistically significant negative correlation between profitability measured by gross profit and cash cycle and the components of the cash cycle (including days of accounts receivable and days of inventory). The study further reveals that there is no significant correlation between gross profit and days of accounts payable.

목차

1. Introduction

2. Literature Review

3. Materials and Methods

4. Results and Discussions

5. Conclusions

References

키워드

Profitability Working Capital Management SMEs Entrepreneurs GCC