Current Liabilities and Financial Performance of Healthcare Firms in Nigeria (Published)
The study evaluated the relationship between current liabilities and financial performance of healthcare firms in Nigeria. The specific objectives of the study are to assess the effect of Trade Payables, Current Tax Liabilities and Short-Term Borrowings on Return on Assets of Healthcare firms in Nigeria. Ex post facto research design was adopted. Data were collected from annual reports and accounts of sampled firms within the industry to test the null hypotheses that selected current liabilities do not affect return on assets significantly. Correlational analysis was the tool of analysis using panel data set covering Fifty (50) observations from Five (5) firms in the Healthcare sector. The findings revealed that Trade Payables (TP) have weak but significant positive relationship with Return on Assets of Healthcare firms in Nigeria with a correlation coefficient of 0.524514 and a p-value of 0.0001. Current Tax Liabilities have weak but significant positive relationship with Return on Assets of Healthcare firms in Nigeria with a correlation coefficient of 0.539686 and a p-value of 0.0001. Short-Term Borrowings have weak but significant positive association with Return on Assets of Healthcare firms in Nigeria with a correlation coefficient of 0.538232 and a p-value of 0.0001. The implication of the findings is that current liabilities such as trade payables, current tax liabilities and short-term borrowings are significant positive determinants of financial performance of healthcare firms in Nigeria. The study therefore concluded that while the observed relationships were statistically significant, the weak correlations suggest that other factors not examined in this study may have stronger association with return on assets of healthcare firms. The study recommends that effective management of trade payables and current tax liabilities is essential for healthcare firms to successfully navigate the tedious regulatory requirements and enhance financial performance. Furthermore, strategic utilization of short-term borrowings would provide healthcare firms with the necessary financial flexibility to support growth initiatives and address short-term funding needs.
Keywords: Current liabilities, Financial Performance, Nigeria, current tax liabilities, healthcare firms, return on assets (ROA), short-term borrowings, trade payables