ABSTRACT
The main purpose of this study was to determine the working capital management practices required by Small and Medium Scale Enterprises (SMEs) for effective operations in Delta State, Nigeria. Six research questions were raised for the study which include; what are the sources of financing working capital required by SMEs for effective operations and six null hypotheses were formulated for the study which include; there is no significant difference between the mean responses of managers and accountants on the cash management practices required by Small and Medium Scale Enterprises for effective operations in Delta State. A descriptive survey design was adopted for this study. The population for the study consisted of 3,627 respondents, made up of 2,012 managers and 1,615 accountants from the 2,012 Small and Medium Scale Enterprises operating in Delta State, as registered with the Ministry of Commerce and Industry. The proportionate stratified and systematic random sampling techniques were employed to select a sample size of 1,110 respondents made up of 616 managers and 494 accountants, which is 30.6% of the population. A Working Capital Management Practices Questionnaire (WCMPQ) was used as the instrument for the study, which was face validated by five experts; two from the Department of Vocational Teacher Education, University of Nigeria Nsukka, two from the faculty of education, Delta State University, and one professional in the industry. The Cronbach Alpha Reliability Coefficient of 0.81 was obtained for the study. The instrument was administered on personal contact by the help of 18 trained research assistants. Out of the 1110 copies of questionnaire administered, 990 were retrieved and used for the study. The data collected were analyzed using the mean and standard deviation in answering the six research questions while t-test analysis was employed in testing the six null hypotheses at 0.05 level of significance. The findings obtained includes: (1) SMEs in Delta State highly require both long-term and short-term sources in financing their working capital; (2) SMEs in Delta State highly require most cash management practices. Amongst others, it was recommended that Business educators, especially accounting educators should be innovative in their instruction by equipping their students with the relevant skills on cash management, accounts receivables management, inventory management, accounts payable management, and investment management; which will enable these students to stand the better chance of succeeding when they establish SMEs.
