The relationship between profitability and liquidity in South African listed firms

Master Thesis

2012

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http://hdl.handle.net/11427/11143
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thesis_com_2012_siame_c.pdf (1.13 MB)
Authors
Siame, Chitongwa
Supervisors
Uliana, Enrico
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University of Cape Town

Department
Department of Finance and Tax
Faculty
Faculty of Commerce
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Abstract
This dissertation analyses the influence of liquidity on the profitability of South African listed firms between 2000 and 2009. The importance of this paper is to assess whether South African firms will improve profitability by managing liquidity efficiently. We used data from past published results of 120 JSE listed firms. The findings from the study suggest that there exists a negative relationship between profitability and liquidity as measured by the cash conversion cycle. Furthermore, efficient liquidity management improves return to shareholders by reducing time taken from the moment that creditors/suppliers are paid until the moment cash is collected from customers/debtors.
Description

Includes bibliographical references.

Keywords
Financial Management

Reference:

Siame, C. 2012. The relationship between profitability and liquidity in South African listed firms. University of Cape Town.

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Masters