ABSTRACT
The main thrust of this study is to unveil the working capital management practices of small and medium scale enterprises in Akwa Ibom Stateof Nigeria. A well designed and implemented working capital management is expected to contributes positively to the creation of a firms values. The study used descriptive and analytical sample survey for the representation and the analysis of the findings. The result shows that 87.4% of the entrepreneurs functioned as sole proprietors, whiles 14.1% as partnership and the remaining 1.5% as cooperative societies. The results again shows that 46.1% received credit from suppliers and the average credit period given by SMEs to their credit customers ranged between seven to sixty days(7-60days).From the study , two main problems faced by SMEs in dealing with credit customers are late payment and bad debts. The results shows that 52.8% of the respondents use note books to represents cash books whiles non(0%) of the respondents use computer inventory control. 65.3% of the respondents have bank accounts for their businesses. Personal savings accounted for about 35.7% of the start up capital and SMEs consider inflation /price increases to be more problematic than even high debtors turnover period and low stock turnover.The SMEs should establish organizations and groups like civil society organizations, regional, district ,community and interest groups to jointly organise and sponsor training programmes for their accounting personnel. There is also the need for SMEs to identify their investment priorities particularly those that are crucial in sustaining their businesses in the long run. They should sacrifice a chunk of their funds to finance and achieve these priorities that will enable them to generate extra cash or profits to plough back into other sectors of their industries. It is also recommended that SMEs should prepare budget at each time they intend to embark on major expenses. This will forestall unnecessary, unwanted, overestimated and underestimated expense. There is also the need for SMEs to formulate credit policy for their enterprise and to create a re-order level policy for their institution that will create an enabling environment for them to request for their supply of moderate and high quality stocks.
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