Liquidity Management and Financial Performance of Quoted Consumer Goods Companies

ABSTRACT

This study empirically analysed the impact of liquidity management on financial performance of quoted consumer good companies in Nigeria. The population of this study consists of all consumer good companies listed in the Nigeria stock from 2009 to 2018. The sample size was 7 consumer goods companies listed on the Nigeria Stock Exchange. The data were obtained from the annual reports and accounts of the sample companies and Nigerian Stock Exchange Fact Book. The method of data analysis used in this study is the Least Squares Regression Method the results showed a positive and a weak direct relationship between cash ratio (0.0134) and return on assets of quoted consumer good companies in Nigeria. Also, the results showed a negative and weak inverse relationship between current ratio (0.0125) and return on assets of quoted consumer good companies in Nigeria. The results also showed a negative and a weak inverse relationship between quick ratio (0.0034) and return on assets of quoted consumer good companies in Nigeria. Therefore, the study recommends that consumer good companies should focus on improving their asset utilization ratio so as to improve their performance. This is because a change in the liquidity management of consumer goods companies would not have significant influence on their financial performance.