AN EVALUATION OF WORKING CAPITAL FOR THE SUCCESSFUL MANAGEMENT OF ORGANIZATIONS

Chapter one

Introduction

A firm usually evaluates its working capital management whether small or medium. The sole motive of every business is to make profit.

Many organization can be seen to have bee forced out of business simply because of inadequate or excessive management of working capital.

This could be as a result of overtrading, under trading, lack of a careful appraisal of the procedure of organization of business and probably due to future to review the effectiveness or other wise of existing system of control.

In this chapter, the concept and general principle of working capital in relation to choosing organization of study, there is no company required, but it is an obvious fact that its current assets are insufficient to meet current liabilities, that is there is no working capital. The organization will be unable to satisfy the requirement of its customers and will not be in a position to settle its debts as they arias and will be at the mercy of creditors who might enforce its liquidity.

1.1      background of the study

Kaduna Hotels company limited (Hamdala Hotel) Kaduna, the only premier Hotel in the north and one of the three in the whole name is a wholly owned subsidiary of new Nigeria development company (NNDC) and by extension the government of the nineteen (19) northern states.

The hotel became fully operational in the year 1963. From the in caption of the hotel to the year 1998, the hotel developed to company limited, this makes Hamdala autonomous and is headed by a managing director along with a team of management staff. The Hotel has a total of seventy eight (78) skillful and trained personnel both senior and junior.

Hamdala Hotel has over the year built a good image for itself due to good facilities and services delivery.

1.2      statement of the problem

it appears that some company (s) have the problem of managing their working capital. This has resulted to the poor capital. This has resulted to the poor working capital in many organization. Hence,  it is because of this phenomenon that this study tries to examine the evaluation of working capital for the successful management of Hamdala Hotel

1.3      objectives of the study

The objective of the study are as follows:

1.  To examine the problems of working capital management of the orgnaizatiopn.

2.  To examine how working capital would be managed.

3.  To ascertain it working capital management capable of solving the problem of the organization.

4.  To highlight how the problem could be evaluated and managed within a well structured framework.

1.4      Significance of the study

The researcher work would be of great benefit to the researcher as part of the fulfillment of the requirement of the award of Higher National Diploma in Business Administration and Management. Also managers, working capital administrators, government and students would benefit as it provides and impetus for future study on effective working capital management

For greater productivity in organization the researcher also highlight the attendant consequences of poor capital management on productivity and the way forward ion achieving optimum result.

1.5      Research question

1.  What is the problem of working capital for the successful management of an organization.

2.  How working capital would be managed.

3.  Does effective working capital solve the problem of  a company.

4.  How the problem of working capital would be solved.

5.  What is the prospect of working capital of enterprises in Nigeria.

1.6      Scope of the study

The researcher study will primarily focus on the problems of working capital management of Hamdala  Hotel Kaduna, Kaduna North Local Government Council. The researcher is constrained by certain factors which prevent the exhaustive discussion of the research topic, such factors includes;

i.            Inability to lay hands on proper document because such or some of the documents were tagged confidential that is, going through them might be an intuition in their privacy.

ii.          Unavailability of funds hinders the ability to go deep into the research work.

iii.        Inability to have physical interaction with the manager of the company.

iv.         Most impartiality, most publication may not present the actual state of affair thereby, giving misleading information to any researcher that come across  such publication.

1.7      Limitation of the study

There are some basic problems and hardship that were encountered in the process of collecting the data. Lack of disclosure of some vital information to the researcher hampered the study in no small measure. Strict adherence was served on some of the study and all information supplied in the conduct of the study were kept confidential.

Time factors, semester work load and financial constraints also proof great problem to the researcher.

1.8      Definition of terms

This segment will be use to define various terminologies used in this research.

Working capital: Is a financial metric which recusants the amount of days by day operating liquidity available to the business.

Evaluation: Is the systematic acquisition and assessment of inflammation to provide useful feedback about some object.

Working capital Management: Involves the relationship between firms short term assets and its short term liabilities.

Success: Success can be defined as the gaining of what is aimed at or can be defined as the achievement of desired goals and objective.

Management: Management can be defined as the coordination of all the resources of the organization through the process of planning, organizing, directing and controlling towards achieving the organizational goals and objective. 

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