IMPACT OF WORKING CAPITAL POLICIES ON CORPORATIONS' RETURNS IN THE MANUFACTURING SECTORS OF PAKISTAN Hafsah Batool Lahore

Abstract

The present study examines the relationship between working capital policies and firm performance of fifty limited manufacturing companies listed at the Pakistan Stock Exchange from 2009 to 2018. Panel data methodology was used to evaluate the data. The study's finding shows significant relationships between their working capital policies and the firm’s return. Moreover, there is a positive association between conservative operational capital policy and firms' return. The aggressive working capital has a negative effect on firm performance.      There are two forms of working capital policies, the first form is the aggressive operational capital policy, and the second form is conservative working capital policy. Therefore, this study attempts to check out the impact of working capital policies on companies' financial performance. The study employed descriptive analysis and correlation analysis to assess the collected data. Panel data methodology was used to analyze the data.  Management can increase the value of the firm by using effective working capital management policies. The study would give a better understanding of working capital management policies in the context of Pakistan