Working Capital Management In Automobile Industry

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Working capital is the ability of a business to meet its short-term liabilities as the full due out of its short-term assets.

It is therefore necessary that an industry should always maintain a well-articulated and consistent management of its working capital.

To facilitate the exposition of this research work for a clear understanding by our readers, this work had been divided into three chapters. In course of the study hypothesis were development, it was observed that automobile industry had adequate working capital to improve efficiency of its production we observed that automobile industry had adequate and good quality capital position though it has no credit policy for its customers.

Based on these we concluded that, automobile industry has effective working capital management. Also we provided some useful suggestions that can further improve the effectiveness of the industry’s working capital management. The suggestions include the establishment of credit policy and embarking on marketing strategy organizing of symposium and seminars on working capital management.   


          Title Page

          Approval Page



          Table of Content

          Abstract of Preface


          Chapter One:

1.0       Introduction

1.1    Background of the Study

1.2       Statement of the Problem

1.3       Purpose of the Study

1.4       Significance of the Study


Chapter Two:

2.1       Review of Related Literature

2.2       Working Capital Management an Overview

2.3       Management of Cash

2.4       Management of Inventories

2.5       Management of Debtors

2.6       Management of Creditors

2.7       Method of Data Collected


Chapter Three:

3.1       Design and Methodology

3.2       Sources of Data

3.3       Location of Data


Chapter Four:

4.0       Summary of Findings


Chapter Five: 

5.0       Recommendation and Conclusion






In the early 70’s there was an economic from in Nigeria and manufacturing industries inspite of widespread misapplica and diversion of resources still returned handsome profits. Companies expanded and prospered as a result and effective management became insignificant.

However, in the early 80’s, Nigeria started witnessing an austere economic condition due to global oil fall in price.

Business environment became so complex that most manufacturing industries and other sectors of the economy started findings things difficult.

Hence the need for effective management of resources became imperative.

The financial resources of the manufacturing industries were one of the major casualties. The companies liquid asset were inadequate to meet its day to day requirement of fund and a newly established company require adequate working capital to be able to start off operation effectively.

Good working capital management is vital to effective financial obligation of an industry.

It is therefore imperative at this point to illustrate the definition of working capital. It represent asset used in the day-to-day mining of an enterprise.

In other words, working capital in the net investment in current assets.

Working capital also indicates in a general sense, the ability of a business to meet it short-term liabilities as they fall due out of its short-term asset.

However the importance of working capital cannot be over emphasized. Explicate survey has revealed that there is growing awareness of importance of capital and its influence on the success of a business organization.

Based on the above general premises of our discussion, working capital management refers to all aspect of administration of


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