Working Capital Management Practices of Selected Small and Medium Scale Enterprises in the Cape Coast Metropolis, Ghana

Nuhu Alhassan


The purpose of the study was to examine working capital management practices of Small and Medium Scale Enterprises in the Cape Coast Metropolis. The study adopted the descriptive research design. The population of the study consisted of eight strata of registered SMEs grouped into various associations recognised by the National Board for Small Scale Industries. All the 719 registered and active owners/managers of SMEs in the metropolis form the target population. The sample size of 179 was used for the study. The respondents were selected using snowball sampling procedure. The instrument used in collecting data was questionnaire. Descriptive statistics such as cross tabulation, frequency and percentage distributions were used in analysing the data in order to tackle the specific objectives of the study. The study revealed that SMEs have working policies on working capital management practices; however, they do not pay much attention to financial records keeping practices and cash budgeting and its related issues.  It was further revealed that, the enterprises have credit policies that ensure the effective management of credit sales. The study recommended that management/owners of the SMEs should ensure that there is sufficient policies which when implemented will make it mandatory for the enterprise to prepare, review and spend within its budget.

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