Cash Management and Financial Performance of a Private Ltd Company: A Case Studies of Elgon Millers Ltd
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Date
2024-06-17
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Uganda Christian University
Abstract
The study was designed to evaluate cash management and financial performance in Private ltd
Company by assessing the relationship between the two variables.
The research was aimed at achieving the following objectives; to find out the effect of Cash
Collection and financial performance, to find out the effect of cash disbursement on financial
performance, to find out the effect of cash budgeting and financial performance of Private Ltd
Company.
A case study design was adopted during the study; information was obtained from primary
sources using questionnaires and interviews and purposive sampling was used.
Finding: a positive significant relationship between cash collection and financial performance
(r = 0.985**, p< 0.01), also cash disbursement and financial performance, a significant positive
relationship was revealed from the results (r = 0.943**, p< 0.01), and finally findings revealed
that there is a positive and significant relationship between cash budgeting and financial
performance with a result of (r = 0.978**, p< 0.01). If cash management is purely monitored, it
becomes easy to implement and plan for the profits to be generated by the firm and therefore it
is only through effective implementation of cash management that firms get desired profit set
levels therefore the researcher concluded that cash management has a positive effect on
financial performance of organizations.
Recommendations suggested included the need for deploying a cash management system which
involves support and coordination among multiple departments, putting into place more
controls to ensure that cash is safe and also using more of the accrual basis of cash out flow
than the cash basis in order to maintain the liquidity at an optimal level.