Search results

1 – 5 of 5
Per page
102050
Citations:
Loading...
Access Restricted. View access options
Article
Publication date: 5 June 2017

Godfred Adjapong Afrifa and Ernest Gyapong

The purpose of this paper is to extend the literature on trade receivables and trade payables by examining the determinants of net trade credit.

1612

Abstract

Purpose

The purpose of this paper is to extend the literature on trade receivables and trade payables by examining the determinants of net trade credit.

Design/methodology/approach

To do that, a sample of 67,047 firms in the UK with 443,190 firm year observations is used.

Findings

The results are robust to unobserved heterogeneity and industry effects. The evidence suggests that firms with more inventories, market share and are financially distressed invest less in trade credit. Moreover, higher operating cash flow, annual sales growth, export propensity, access to bank credit and larger firms lead to higher investment in trade credit.

Originality/value

Additionally, the paper broadens the scope of the literature by analysing the determinants of net trade credit around the financial crisis and industry competitiveness.

Details

International Journal of Managerial Finance, vol. 13 no. 3
Type: Research Article
ISSN: 1743-9132

Keywords

Access Restricted. View access options
Article
Publication date: 14 May 2018

Godfred Adjappong Afrifa and Oluseyi Oluseun Adesina

The purpose of this paper is to empirically explain the relationship between the remuneration levels of a sample of listed small and medium enterprise (SME) directors and firm…

1221

Abstract

Purpose

The purpose of this paper is to empirically explain the relationship between the remuneration levels of a sample of listed small and medium enterprise (SME) directors and firm performance. The paper also investigates whether deviations from the optimal directors’ remuneration level reduces firm performance.

Design/methodology/approach

The study uses a panel data regression analysis of 802 AIM-listed SMEs over an eight-year period (2005-2012).

Findings

Using a non-linear approach, the results show that an optimum director’s remuneration level is calculated by comparing the benefits and costs of director’s remuneration. Hence, the paper not only shows how directors’ remuneration level affects firm performance but it also extends the stream of knowledge by indicating how a deviation from the optimal point influences UK-listed SME performances. Moreover, the results show that the effect of directors’ remuneration on firm performance is greater during a financial crisis period.

Originality/value

Compared with previous literature on directors’ remuneration, this paper focuses on AIM-listed SMEs, and the author’s finding of a concave relationship between directors’ remuneration level and performance of leads them to recommend that firms, especially SMEs, should endeavour to determine the optimal level of directors’ remuneration to maximise performance.

Details

Review of Accounting and Finance, vol. 17 no. 2
Type: Research Article
ISSN: 1475-7702

Keywords

Access Restricted. View access options
Article
Publication date: 15 February 2016

Godfred Adjapong Afrifa and Kesseven Padachi

The purpose of this paper is to report the results of an investigation of the relationship between working capital level, measured by the cash conversion cycle (CCC) and…

6144

Abstract

Purpose

The purpose of this paper is to report the results of an investigation of the relationship between working capital level, measured by the cash conversion cycle (CCC) and profitability of small and medium enterprises (SMEs).

Design/methodology/approach

The paper employs panel data regression analysis on a sample of 160 Alternative Investment Market (AIM)-listed SMEs for the period from 2005 to 2010.

Findings

The empirical results show that there is a concave relationship between working capital level and firm profitability and that there is an optimal working capital level at which firms’ profitability is maximised. Furthermore, an examination as to whether or not deviations from the optimal working capital level reduce firm profitability indicate that deviations above or below the optimum decrease profitability.

Research limitations/implications

The sample is limited to AIM-listed SMEs, and therefore the findings cannot be generalised to all firms.

Practical implications

Overall, the evidence suggests that firms should strive and attain the optimal working capital level in order to maximise their profitability.

Originality/value

The results are of importance to both SMEs and policy makers providing insight into the nature of CCC and its relationship to SMEs profitability.

Details

Journal of Small Business and Enterprise Development, vol. 23 no. 1
Type: Research Article
ISSN: 1462-6004

Keywords

Access Restricted. View access options
Article
Publication date: 8 February 2016

Godfred Adjapong Afrifa

– This paper aims to examine the influence of cash flow on the relationship between net working capital and firm performance.

7066

Abstract

Purpose

This paper aims to examine the influence of cash flow on the relationship between net working capital and firm performance.

Design/methodology/approach

The paper uses unbalanced panel data regression analysis on a sample of 6,926 non-financial small and medium enterprises in the UK for the period from 2004 to 2013.

Findings

The results indicate a strong concave relationship between net working capital and performance in the absence of cash flow; however, the relationship becomes convex after taking cash flow into consideration. The results further show that firms with cash flow below the sample median exhibit lower investment in working capital, but firms with cash flow above the sample median have higher investment in working capital. The results suggest that managers should consider their firms cash flow when determining the appropriate investment to be made in working capital, so as to improve performance.

Practical implications

Overall, the results suggest that whilst firms with limited cash flow should strive to reduce investment in working capital, firms with available cash flow should increase investment in working capital to improve performance.

Originality/value

This current study incorporates the relevance of cash flow in assessing the association between working capital management and firm performance.

Details

Review of Accounting and Finance, vol. 15 no. 1
Type: Research Article
ISSN: 1475-7702

Keywords

Access Restricted. View access options
Article
Publication date: 31 July 2013

Venancio Tauringana and Godfred Adjapong Afrifa

This paper aims to report the results of an investigation of the relative importance of working capital management, measured by the cash conversion cycle (CCC), and its components…

10085

Abstract

Purpose

This paper aims to report the results of an investigation of the relative importance of working capital management, measured by the cash conversion cycle (CCC), and its components (inventory, accounts receivable and accounts payable) to the profitability of SMEs.

Design/methodology/approach

The paper employs panel data regression analysis and a questionnaire survey on a sample of 133 Alternative Investment Market (AIM) listed SMEs. The panel data analysis utilises financial data for the period 2005 to 2009. The questionnaire survey results are based on 19 SMEs that responded.

Findings

Panel data analysis results show that the management of accounts payable (AP) and accounts receivable (AR) is important for SMEs profitability. However, AP management is relatively more important than AR management. Inventory (INV) and CCC management is not important for SMEs profitability. Questionnaire results suggest that management of CCC and all its components is perceived as important for SMEs profitability. In terms of relative importance, AR management is most important, followed by AP, INV and CCC respectively.

Research limitations/implications

The sample is limited to AIM listed SMEs, and therefore the findings cannot be generalised to all companies.

Practical implications

Overall the results imply that the SMEs need to concentrate their limited resources on managing AR and AP in order to be more profitable.

Originality/value

The study is the first to investigate the relative importance of WCM and its components to SMEs profitability and use both regression analysis and questionnaire survey.

Details

Journal of Small Business and Enterprise Development, vol. 20 no. 3
Type: Research Article
ISSN: 1462-6004

Keywords

1 – 5 of 5
Per page
102050