CASH FLOW MANAGEMENT AND FINANCIAL PERFORMANCE OF TORORO CEMENT, EASTERN UGANDA

ABSTRACT

The study was to assess the effect of cash flow management and organizational perfàrmance in

Tororo cement of companies. It was based on the research objectives that included assessing the

effect of accounts receivable management on organizational performance, analyze the role of

accounts payables management on organizational performance and examine the effect of credit

management on organizational performance. The study adopted a surveys and case study design

with the sample population of 50 people as respondents chosen from Tororo cement of

companies. It was based on quantitative and qualitative research approaches. The study fIndings

were that accounts receivable management on organizational performance in Tororo cement

Accounts receivables reduces defaults in payment •for business according to 80% of the

respondents who are in agreement, reduces cost of administration of Accounts receivables

business had 88%, enhances working capital flow management had 78%, Provision of debtor

information to the organization had 78%, reduces cash collection delays for the organization

had 66%, reduces cash collection delays for the organization had 66%. It was also established

that accounts payables management affect organizational performance in Tororo cement. The

findings based on agreement was that, regularly pay creditors in time for continued operations

with 80% of the respondents, maintain records of what it owes to suppliers had 74% of

agreement, organization usually pays using the payment mode required by our suppliers (cash,

dra/I, cheques had 60% of respondents, company’s suppliers are regularly infOrmed of the

delays to avoid charges on late payment 48% of the respondents, the organization normally

keeps a stringent/delay payment policy 60% of respondents, reduces costs of invoicing and

adequate and accurate financial reporting had 58% ofthe respondents. The study findings on the

eff~ct of credit management on organizational performance on Tororo cement, The study

findings were that on the effect of credit management on organizational perfOrmance on Tororo

cement. The findings were that the organization experiences cash defIcits in its operations hinder

operations according to 90% of respondents, The company ‘s cash flows are characterized by

more inflows than outflows had 94% of the respondents, the conipany has effIcient cash flow

management systems supporting operations had 60% of the respondents, The organization

carries out careful planning and monitoring of cash flows over time so as to determine the

optimal cash to hold 90% of the respondents, budgeting is useflil in planning fOr shortage and

surplus of cash 60% of the respondents and Credit is effectively handled to attain the complaints

from the staff and manage had 60% of the respondents. The study recommended fOr the need to

enhance accounts intens~,fl’ debt collection for organizations to improve the perfOrmance,

maintaining a positive cash flow is essential for a business to survive, Effective accounts

receivable management can assist agencies improve customer service through providing timely

information on customer requirements, There is need to improve the credit payment procedures.