Record Details

Degree of Financial and Operating Leverage and Profitability of Insurance Firms in Ghana

International Business and Management

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Field Value
 
Title Degree of Financial and Operating Leverage and Profitability of Insurance Firms in Ghana
 
Creator Gatsi, John Gartchie
Gadzo, Samuel Gameli
Akoto, Richard Kofi
 
Subject
Profitability; Working capital management; Operating and financial Leverage

 
Description The profitability of any business entity for a particular time period can be conceptualized as the final outcome of its investing and operating activities. This paper investigated how profitability of insurance firms in Ghana, is influenced by working capital management and leverage using 18 firms. The current ratio was taken as representative of the result of working capital management policy and financial leverage and operating leverage as the bench mark for capital structure. Supplementary analysis was also undertaken to assess the impact of premium growth, GDP and firm size on profitability. Panel data methodology was used to determine whether profitability of insurance companies is related to selected indicators in accordance with the accepted finance theory. Furthermore, the research results found that, degree of financial leverage and liquidity are inversely related to profitability while operating leverage is positively related to profitability. Key words: Profitability; Working capital management; Operating and financial Leverage
 
Publisher Canadian Research & Development Center of Sciences and Cultures
 
Contributor
 
Date 2013-11-30
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article

 
Format application/pdf
 
Identifier http://www.cscanada.net/index.php/ibm/article/view/j.ibm.1923842820130702.1060
10.3968/j.ibm.1923842820130702.1060
 
Source International Business and Management; Vol 7, No 2 (2013): International Business and Management; 57-65
1923-8428
1923-841X
 
Language eng
 
Relation http://www.cscanada.net/index.php/ibm/article/view/j.ibm.1923842820130702.1060/pdf_20
 
Coverage