IMPACT OF ASSETS EFFICIENCY MANAGEMENT ON THE FINANCIAL PERFORMANCE OF LISTED COMPANIES IN SRI LANKA

Abstract

The title of this research is The Impact of Assets Efficiency Management on the Financial Performance of Listed Companies in Sri Lanka. The purpose of the study is to examine the impact between assets efficiency ratios analysis and financial performance ratio analysis of listed companies in Sri Lanka. Over period five years (2015-2019). This research used four assets efficiency ratio analysis such as Total Assets Tumolero Ratio (TA1R), Non-current Assets Turnover Ratio (NCATR), Current Assets Tumolero Ratio (CATR) and Working Capital Turnover Ratio (WCTR) in determining their impact and relationship on Financial Performance it measures Return on Assets (ROA) of Listed Companies in Sri Lanka. Financial performance as a dependent variable Assets Efficiency Management Ratio as independent variables. The data were obtained from the financial annual reports (both statement of comprehensive income and statement of financial position) of the selected listed companies on the Colombo Stock Exchange (CSE). Descriptive statistics, Pairwise correlation and $egressions were employed to find out the relationship and impact between the variables and their effect on Financial Performance,. The result of the analysis shows that Non-current Assets Turnover Ratio, Working Capital Turnover Ratio have negative relationship between Return on Assets and Total Assets Turnover Ratio, Current Assets Turnover Ratio have positive relationship between Return on Assets. The analysis also statistically significant with Current Assets Turnover Ratio with Return on Assets in Listed Companies in Sri Lanka. And also Total Assets Turnover Ratio, Non-current Assets Turnover Ratio and Working Capital Tumolero Ratio with Return on Assets statistically insignificant in this research. The results further suggested that only 5.03% of the variations on the dependent variable were caused by the independent variables in this model. Based on the other findings, the researcher recommends that the management decrease the assets in performance of financial performance growth. Finally management should utilize its assets efficiently in order to generate more profit for the company.