The relationship between profitability and liquidity in South African listed firms

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.

Grantor dc:publisher.institution

Department of Finance and Tax

Year dc:date.issued

2012

Author dc:creator

• Siame, Chitongwa

Advisor dc:contributor.advisor

• Uliana, Enrico

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/11427/11143

OAI identifier oai:identifier

oai:open.uct.ac.za:11427/11143