Universal Journal of Accounting and Finance Vol. 9(4), pp. 701 - 711
DOI: 10.13189/ujaf.2021.090416
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Cash Flow Management and Industrial Firms Performance in Nigeria


Idamoyibo Hwerien Rosemary 1, Abner Ishaku Prince 2, Akpan Ededem Jack 3, Orugun Ibidunni Fausat 4, Emmanuel Nwabueze Enoch 3, Udo Emmanuel Samuel 3,*
1 Department of Accounting, Ignatius Ajuru University of Education, Port Harcourt, Nigeria
2 Department of Management, University of Nigeria Enugu Campus, Nigeria
3 Department of Banking and Finance, University of Nigeria Enugu Campus, Nigeria
4 Department of Banking and Finance, Kogi State University, Nigeria

ABSTRACT

The focal point of this research was to establish the liquidity-viability link in quoted non-financial firms in Nigeria. Liquidity improves the profitability of firms but not its solvency. The solvency and performance of a firm exclusively anchor on the firm's capacity to realize the "twin conflicting" targets of liquidity sufficiency and stable growth through a diversified and stable asset-liability mix. The firm's inability to strike an equilibrium balance among meeting financial obligations, sufficient liquidity and profitability has led to insolvency of most firms in Nigeria. Most empirical studies in Nigeria ignore effect of cash flow management on the non-financial sector to focus on the financial sector. Use the regression model predominantly and also ignore the widely accepted econometric process of a pre and post diagnostic test. This study focuses on 13 quoted non-financial sectors in Nigeria firms from 1999-2020. The preliminary test was conducted to determine the best fit model. Liquidity proxy by the current ratio significantly influences ROE and non-significantly on ROE when proxy by the cash flow ratio. Findings also divulged a bidirectional nexus between current ratio, cash flow ratio, and ROE and a non-causal nexus with other variables. Policy recommendations are further discussed.

KEYWORDS
Cash Liquidity, Management Financial Performance, Non-financial Firms, Nigeria

Cite This Paper in IEEE or APA Citation Styles
(a). IEEE Format:
[1] Idamoyibo Hwerien Rosemary , Abner Ishaku Prince , Akpan Ededem Jack , Orugun Ibidunni Fausat , Emmanuel Nwabueze Enoch , Udo Emmanuel Samuel , "Cash Flow Management and Industrial Firms Performance in Nigeria," Universal Journal of Accounting and Finance, Vol. 9, No. 4, pp. 701 - 711, 2021. DOI: 10.13189/ujaf.2021.090416.

(b). APA Format:
Idamoyibo Hwerien Rosemary , Abner Ishaku Prince , Akpan Ededem Jack , Orugun Ibidunni Fausat , Emmanuel Nwabueze Enoch , Udo Emmanuel Samuel (2021). Cash Flow Management and Industrial Firms Performance in Nigeria. Universal Journal of Accounting and Finance, 9(4), 701 - 711. DOI: 10.13189/ujaf.2021.090416.