February 2019 Vol.
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Merit Research Journal of Business and
Management Vol. 7(1) pp. 001-011, February, 2019
Copyright © 2018 Merit Research Journals
Original Research Article
Effect of Accounts Receivable Management on
the Performance of Selected Business Organizations in Nigeria
1Department of Accounting
and Finance, Crawford University, Igbesa, Ogun State.
2Department of Administration and Management,
Crawford University, Igbesa, Ogun State.
*Corresponding Author’s E-mail: firstname.lastname@example.org
Accepted January 29, 2019
receivable of a firm is a legally enforceable claim for payment
from a business to its customers / clients for goods supplied
and / or services rendered in execution of the customer’s order.
The purpose of the study is to establish how Accounts receivable
management tries to minimize the amounts of money tied up in
form of accounts receivables and thus takes the organization
back to its original set goals. Their accurate monitoring and
proper management are also important dimensions in organization.
This study examined the effects of receivables management on
manufacturing companies in Nigeria using Nestle Nigeria Plc. and
Cadbury Nigeria Plc. as case study. The study further examined
the effects of sales growth on corporate performance and the
effects of bad debt on company’s profitability. The study used
secondary data collected from the annual reports of both
companies for the period 2000-2011 using bad debt, accounts
receivable and sales growth as variables. The Hypotheses were
analyzed using regression analytical tools. The result showed
that accounts receivable directly affects the profitability of
the company having a negative relationship. It was advised that
companies should create credit extension policies.
Keywords: Organizations, Accounts receivable, Management