| dc.description.abstract | Working capital management plays an important role in improving the profitability of the company. The company can optimize their working capital by making the trade-off between profitability and liquidity. This article analyzes the impact of working capital management on profitability of 120 companies in 8 different industries in Vietnam stock market from 2012-2015, which are 480 observations in total. Based on the unbalance panel data, correlation analysis and regression analysis are used to establish the relationship between working capital management and profitability of the company. The data of the variables are obtained from the financial statements, annual reports of enterprises. Technical data analysis Eview, this method allows to estimate the two micro and macro variables simultaneously in the same model. The variables are used to test the relationship include Return on asset (ROA), Receivable Conversion Period (RCP), Inventory Conversion Period (ICP), Payable Deferral Period (PDP), Current Ratio (CR), Debt Ratio (DR), Firm size (SZ) and Sales growth (SG). The results show negative relationship between RCP, ICP, and CCC to ROA. The results may not be true for every aspect of firms or every situation, managers need to consider the characteristics of different industries as well. | en_US |
