دراسات العدد الاقتصادي
Volume 12, Numéro 2, Pages 381-397

The Effect Of Working Capital Management On Firms’ Performance: Evidence From Algerian Listed Firms

Authors : Boussouf Azzeddine . Belkaid Brahim .

Abstract

The present study was designed to investigate the effect of working capital management on the performance of Algerian firms listed on the Algiers Stock Exchange over the 2015-2019 period, we collected their annual financial statements from the COSOB’s database in order to determine the different variables needed for our study. Pearson’s correlation and pooled ordinary least square regression models were used for the analysis. The results indicate a significant positive relationship between cash conversion cycle and firms’ performance, the same result was found for the number of days on inventory, whereas the number of days of accounts receivable and number of days of accounts payable showed a negative relationship with firms’ performance. These results will allow Algerian listed firms to improve their performance by efficiently managing their working capital.

Keywords

working capital management ; firm performance ; cash conversion cycle ; Algiers stock exchange ; financial statement