The Impact of Receivables Management on the Growth of Shareholder’s Value, A Case Study of Small and Medium Enterprises (Smes) In Jinja District.
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Date
2007-09
Authors
Odero, M. George
Journal Title
Journal ISSN
Volume Title
Publisher
Kampala International University, college of Economics and management-masters of business administration
Abstract
Whenever a business extends a credit to its clients through credit sales definitely
it creates the accounts receivables, the background of this study depicts that at
first; most of the SMEs depended on the collaterals as a security to the debts that
it has advanced to its client. Currently, due to economical changes brought out
by the competition has forced these SME5 to start issuing credit without attaching
much on the notion of collaterals and most have ended winding up.
The objective of the study was to find out if SMEs really invest on receivables; in
addition to examine the way these receivables are managed and the factors that
affect its management. Lastly, also there was a quest to understand the impact of
receivables management on the growth of the shareholders value within the
SMEs where Jinja district was used as a case study. The methodology used in
the study was a descriptive design where data was collected and analyzed both
quantitatively and qualitatively, the data was presented by use of tables and
graph.
The findings revealed that few of the SME5 invest on receivables. Secondly, the
findings showed that over half of the respondents admitted having knowledge on
receivables management although their credit policies was still lacking. Due to
these facts, most of the SMEs were seen as not able to increase the growth of
their shareholders value due to poor receivables management. In concluding as
per the finding of the research, the researcher noted few SMEs invest on
receivables, few had investment on receivables yet they all offered credit to their
clients in addition to incurring doubtful and bad debts which means that there’s
still poor receivables management within the SME5.
Lastly as per the findings, their were few of these entities which realized growth
in their shareholders value through accounts receivables which implies that to
most SMEs, receivables management is poor and has not seen them adding
growth to their shareholders value.
Therefore the researcher recommended that, the SMEs should enact policy to
aid them in investing on receivables, they should also adopt modern methods of
receivables management by employing better credit policies, in addition to that
the stakeholders in the business field especially the government and Ngo’s
should give a hand to this SME5 in order to make them realize growth of their
shareholders value through receivables management.
Description
A Research Thesis Submitted to the School of Post Graduate In Partial Fulfillment For The Award Of A Master’s Degree of Business Administration (Finance and Accounting) Of Kampala International University.
Keywords
Receivables, Management, Growth of Shareholder’s Value,