Effect of liquidity management on profitability of cement manufacturing firms in Kenya
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Date
2015-10Author
Njuguna, Tabitha
Type
ThesisLanguage
enMetadata
Show full item recordAbstract
Liquidity management describes the effort of the investors or managers to reduce
liquidity risk exposure to enhance profitability of the firm. This study was carried out
on the effect of liquidity management on profitability of cement manufacturing firms
in Kenya. A descriptive approach was used in trying to establish the relationship
between liquidity management on profitability of cement manufacturing firms. The
study adopted a descriptive approach in trying to find out the effect of liquidity
management on the profitability of cement manufacturing firms in Kenya. The study
did a census survey since it involved all the seven cement manufacturing firms in
Kenya. Data was obtained from secondary sources; financial statements. The
collected data was analyzed using SPSS and presented in tables. The results of the
regression analysis showed that there was a significant relationship between the
relationship between liquidity management and profitability. Correlation analysis also
shows a moderate positive relationship between liquidity management and
profitability. The limitation of this study was that the annual financial statements are
prepared under the fundamental assumptions and concepts which are subjective and
therefore they are not be uniformly applied especially in terms of provisions and
estimates. The study recommends for a comparative study that can be carried out to
establish whether liquidity management affects profitability in other sectors like the
public sector.
Publisher
University of Nairobi