The Importance of Working Capital Policy

Oct 13, 2025 by talynt.org 97 views

The Effect of Working Capital Policy Ratios on the Ability of Profit (ROI) at PT Primarindo Asia, Tbk

Introduction

In the fast-paced business world, working capital policy plays a crucial role in determining the success of a company. It is essential for companies to have a well-planned working capital policy to ensure that they have sufficient funds to meet their operational needs and take advantage of growth opportunities. This study aims to evaluate the effect of working capital policy ratios on the ability of PT Primarindo Asia, Tbk in obtaining profits, measured through Return on Investment (ROI). The study focuses on four working capital policy ratios, namely the ratio of working capital shopping, current ratio, ratio of working capital turnover, and current asset ratio to total assets, with ROI as the dependent variable.

The Importance of Working Capital Policy

Working capital policy is a critical component of a company's financial management strategy. It involves the management of current assets, such as cash, accounts receivable, and inventory, to ensure that the company has sufficient funds to meet its operational needs and take advantage of growth opportunities. A well-planned working capital policy can help companies to improve their financial performance, increase their competitiveness, and achieve their long-term goals.

Research Methodology

This study uses multiple linear regression analysis to evaluate the effect of working capital policy ratios on ROI. The data was collected from PT Primarindo Asia, Tbk and processed using the SPSS statistical application version 12.0. The study uses four independent variables, namely the ratio of working capital shopping, current ratio, ratio of working capital turnover, and current asset ratio to total assets, with ROI as the dependent variable.

Results of the Analysis

The results of the analysis showed that the F statistical test was used to evaluate the simultaneous effect of the working capital policy ratio to ROI. From the test results, it was found that the significant value of F count was 0.008, which was smaller than α 0.05, indicating that the null hypothesis (Ho) was rejected. This means that all independent variables have a significant effect on ROI at PT Primarindo Asia, Tbk.

In a more in-depth analysis, the results of the T statistical test showed that the ratio of working capital shopping (significant 0.007) and the ratio of current assets to total assets (significant 0.015) had a partial significant effect on ROI. This shows that not all ratios have the same influence, and there are certain ratios that are more affecting the company's profits.

Discussion of the Results

The results of the analysis indicate that the ratio of current assets to total assets has the highest value, which means this variable has a dominant effect on ROI. This indicates the importance of efficient and effective current asset assets management in supporting the company's financial performance. The study suggests that PT Primarindo Asia, Tbk plans a more mature working capital policy. The decision to use assets, especially current assets, must pay attention to daily operational needs and expansion opportunities that can improve company performance.

Conclusion

The results of this study provide a clear picture of the importance of working capital policy ratios in influencing company profits. A good understanding of these ratios can help management in better decision making to improve ROI and, in the end, the company's long-term success. The study suggests that companies should pay attention to the ratio of current assets to total assets, as it has a dominant effect on ROI. By implementing a well-planned working capital policy, companies can improve their financial performance, increase their competitiveness, and achieve their long-term goals.

Recommendations

Based on the findings of this study, the following recommendations are made:

PT Primarindo Asia, Tbk should plan a more mature working capital policy that takes into account the ratio of current assets to total assets.
The company should pay attention to daily operational needs and expansion opportunities that can improve company performance.
The company should implement efficient and effective current asset assets management to support the company's financial performance.
The company should use the results of this study to make better decision making to improve ROI and, in the end, the company's long-term success.

Limitations of the Study

This study has several limitations that should be noted. Firstly, the study only focuses on PT Primarindo Asia, Tbk and may not be generalizable to other companies. Secondly, the study only uses four working capital policy ratios, and other ratios may also have an effect on ROI. Finally, the study only uses a single dependent variable, ROI, and other dependent variables may also be affected by working capital policy ratios.

Future Research Directions

This study provides several future research directions. Firstly, the study can be replicated on other companies to see if the results are generalizable. Secondly, the study can be extended to include other working capital policy ratios and dependent variables. Finally, the study can be used as a basis for further research on the effect of working capital policy on company performance.

Conclusion

In conclusion, this study provides a clear picture of the importance of working capital policy ratios in influencing company profits. A good understanding of these ratios can help management in better decision making to improve ROI and, in the end, the company's long-term success. The study suggests that companies should pay attention to the ratio of current assets to total assets, as it has a dominant effect on ROI. By implementing a well-planned working capital policy, companies can improve their financial performance, increase their competitiveness, and achieve their long-term goals.
Frequently Asked Questions (FAQs) about the Effect of Working Capital Policy Ratios on the Ability of Profit (ROI) at PT Primarindo Asia, Tbk

Q: What is working capital policy and why is it important?

A: Working capital policy is a critical component of a company's financial management strategy. It involves the management of current assets, such as cash, accounts receivable, and inventory, to ensure that the company has sufficient funds to meet its operational needs and take advantage of growth opportunities. A well-planned working capital policy can help companies to improve their financial performance, increase their competitiveness, and achieve their long-term goals.

Q: What are the four working capital policy ratios used in this study?

A: The four working capital policy ratios used in this study are:

Ratio of working capital shopping
Current ratio
Ratio of working capital turnover
Current asset ratio to total assets

Q: What is the significance of the ratio of current assets to total assets?

A: The ratio of current assets to total assets has the highest value, which means this variable has a dominant effect on ROI. This indicates the importance of efficient and effective current asset assets management in supporting the company's financial performance.

Q: What are the implications of this study for PT Primarindo Asia, Tbk?

A: The study suggests that PT Primarindo Asia, Tbk should plan a more mature working capital policy that takes into account the ratio of current assets to total assets. The company should pay attention to daily operational needs and expansion opportunities that can improve company performance.

Q: Can the results of this study be generalized to other companies?

A: No, the results of this study are specific to PT Primarindo Asia, Tbk and may not be generalizable to other companies. However, the study provides a framework for other companies to evaluate the effect of working capital policy ratios on their ROI.

Q: What are the limitations of this study?

A: The study has several limitations, including:

The study only focuses on PT Primarindo Asia, Tbk and may not be generalizable to other companies.
The study only uses four working capital policy ratios, and other ratios may also have an effect on ROI.
The study only uses a single dependent variable, ROI, and other dependent variables may also be affected by working capital policy ratios.

Q: What are the future research directions based on this study?

A: The study provides several future research directions, including:

Replicating the study on other companies to see if the results are generalizable.
Extending the study to include other working capital policy ratios and dependent variables.
Using the study as a basis for further research on the effect of working capital policy on company performance.

Q: What are the practical implications of this study for companies?

A: The study provides practical implications for companies, including:

The importance of planning a well-mature working capital policy.
The need to pay attention to daily operational needs and expansion opportunities.
The importance of efficient and effective current asset assets management.

Q: What are the theoretical implications of this study?

A: The study provides theoretical implications, including:

The importance of working capital policy in influencing company profits.
The need to consider the ratio of current assets to total assets in working capital policy.
The importance of efficient and effective current asset assets management in supporting company performance.