Browsing by Author "Premarathne, W.G.I.D."

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Capital Structure and Firm Performance: With Special Reference to the Commercial Banks and Manufacturing Firms in Sri Lanka
(International Conference on Applied Social Statistics (ICASS) - 2019, Department of Social Statistics, Faculty of Social Sciences, University of Kelaniya, Sri Lanka, 2019) Premarathne, W.G.I.D.; Wijesinghe, M.R.P.
In addition to the other financial services, commercial banks are institutions that play a pivotal role in financial intermediation. They play an imperative role in an economy especially financing economic activities. Improvement in the performance of commercial banks would in turn increase their role in an economy (Terraza, 2015; Sufian, 2011; Pasioura & Kosmidou, 2007). In addition to that the manufacturing sector of a country plays a vital role in boosting the economy through value addition and it is the second largest sector in the Colombo Stock Exchange (CSE). Further, number of manufacturing firms in Sri Lankan context is growing rapidly, as indicated by number of companies listed on the CSE drawing our attention back to the sector today. For both the sectors, capital structure decision is an important decision since the profitability of an enterprise is directly affected by such decision. Capital structure is described as the combination of debt and equity. One crucial issue challenging to the managers today is how to determine the combination of debt and equity to achieve optimum capital structure that would minimize the firm’s cost of capital and improves return to owners of the business (Vitor & Badu, 2012). The study identified the firm size as a variable of scholarly interest, due to the fact of, it’s traditionally having much explanatory power, and an understanding of its importance, which has identified as vital for managers who operate in today’s competitive environments (Kioko, 2013). In today’s world, being on the phenomenon of economies of scale, the size of a firm is taking as a crucial factor for a firm’s success. However, modern corporate firms also, seem to be looking to increase their size so as to get a competitive edge over their competitors through multiple ways ( Luqman, Ilo, Lawal, & Fatai , 2017). The study will make multiple contributions to the literature on capital structure, firm size and financial performance through the investigation of the precise composition of capital structure and firm size that maximizes the shareholders return and impacts positively on a bank’s financial performance. And additionally, the study will come in handy to support the government, and regulators in their quest to streamline operations in the banking sector putting in mind that the economy as a whole inch on how the banking sector performs as inappropriate resource allocation can hinder the growth in the economy while paying attention on the manufacturing sector of the country parallel.
Effect of Ex-Ante Risk Management on Financial Stability During Covid 19 Pandemic: Evidence from Food, Beverage & Tobacco Sector Firms in Sri Lanka
(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Sandamali, G.D.U.; Premarathne, W.G.I.D.
Introduction: With the covid 19 outbreak around the globe, scholars have paid attention to investigate whether firms can ensure their financial stability during the COVID-19 pandemic by having ex-ante risk management. Thus, this study aims to identify the effect of ex ante risk management on financial stability of food, beverage, and tobacco sector firms in Sri Lanka during the covid 19 pandemic. Design/Methodology/Approach: The researcher has used a sample of 21 listed companies in food, beverage, and tobacco sector to assess the impact of risk awareness and risk management tools disclosed in annual reports. Data has been gathered using secondary sources and quarterly figures of 2019, 2020 and first two quarters of 2021 have been used for the analysis. Findings: According to the study findings, firms that disclose their risk management tools declares that they have boosted asset utilization and liquidity during the Covid 19 epidemic when compared to before the pandemic. Furthermore, the researcher discovered that inventory management is the most effective risk management tool for ensuring financial stability for businesses during Covid 19 pandemic. Conclusion: The study concludes that there is a significant connection between ex ante risk management and financial stability and also COVID-19 epidemic has a significant impact on the financial wellness of firms. The outcome of the research points out the usefulness of ex-ante risk management in order to mitigate risks in the case of a pandemic. Thus, the study contributes both in practice and knowledge domain.
Exploring the Financial Literacy Programmes Delivered by the Sri Lankan Micro Finance Institutions: A Case Study Approach
(International Conference on Business and Information (ICBI – 2019), [Accounting, Finance and Economics], Faculty of Commerce and Management Studies, University of Kelaniya Sri Lanka, 2019) Premarathne, W.G.I.D.; Abeysekera, R.
Global Financial Literacy Survey done by the Standard & Poor’s Ratings Services reveal that in 2014 only 35% of adults are financially literate in Sri Lanka. There is a dearth of researches covering this critical area using a qualitative approach. Thus, the purpose of this paper is to focus on the critical, yet an under-researched dimension of MF, the intercession of MFIs in delivering FL to the MF clientele focusing on the profiles such as delivering channels, importance, constraints, and strategies to address. Multiple case study method was used as the research method. The data were gathered from a purposive sample using in-depth interviews. The findings show that several channels of delivering FL; social mobilization programmes, seminars, training programmes, community committees, and credit societies, and the importance of delivering FL are; enhancement of human capital, the sustainability of industry and firm, upgrade new venture survival, client protection, and social and economic empowerment and development. Further, the barriers to delivering FL; budget, industry competition, inactive participation, clients’ attitudes, inactive regulatory bodies’ contribution, and external barriers were investigated with the strategies adopted in addressing barriers; community awareness, motivational strategies, regulatory framework and cost addressing strategies. Findings of this study have implications for policymakers in paying attention to make a financially literate clientele in the MF discipline.
Factors Affecting on Effective Cash Flow Management During Covid 19 Pandemic: With Special Reference to The Listed Companies in Sri Lanka
(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Silva, M.K.I.T.; Premarathne, W.G.I.D.
Introduction: This research provides an overview of the complete visibility of the factors which affect the effective cashflow management of selected listed companies of Sri Lanka during the pandemic of Covid-19. The aim of this study is to identify the factors affecting on effective cash flow management during Covid 19 pandemic in the listed companies in Sri Lanka. Design/Methodology/Approach: The study used mixed method, a combination of quantitative and qualitative approaches and secondary data were collected taking 15 listed companies in CSE as the sample for the study. The sample of companies were selected from the retail sector based on their stated capital. Accordingly, 15 companies that have the highest stated capital in the retail sector have been selected. Findings: The study findings show that all the independent variables; operational activity management, investment and financing strategies, support from banks and other financial institutions, and management skills on cash management have a significant impact on the cash flow management of listed companies in Sri Lanka. Conclusion: To conclude, if the management needs to improve the cash flow of the company, they need to focus on operational activity management, investment and financing strategies, support from banks and other financial institutions, and management skills on cash management to gain a healthy cash flow.
Factors Affecting on Financial Stability of SMEs' During Covid 19 Pandemic: With Special Reference to Colombo District
(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Ariyawardhana, M.B.M.; Premarathne, W.G.I.D.
Introduction: In the developing countries, Small and Medium-sized Enterprises (SMEs) are considered as the backbone as their role in economies are vital and large due to their significant Contribution in Gross Domestic Production. The study focuses on identifying the factors that affect to the financial stability of the small and medium enterprises in Western Province Sri Lanka during the Covid-19 pandemic. The research objectives are based on the key highlights of the research problem and aims at identifying the impact of firms’ profitability, liquidity and leverage on financial stability of SMEs’ in Sri Lankan context during the Covid 19 pandemic. Design/Methodology/Approach: The research is based on quantitative approach and uses 14 SMEs in Colombo District, Sri Lanka as the sample. The study has collected both the primary and secondary data and has utilized the two approaches, questionnaire and interviews for primary data collection and financial statements of the firms for secondary data collection. Findings: The research findings based on regression analysis indicate a significant impact of profitability, liquidity and leverage on financial stability of SMEs in Colombo district, Sri Lanka during the Covid 19 pandemic. Conclusion: To conclude it was noted that SMEs need to have a healthy working capital in order to run their business in the short term and they are in a dire need of support from financial institutions and government to go ahead. Thus, it is vital to protect SMEs during this kind of a challenging time as they provide a significant contribution to the countries’ economy,
The Factors Affecting on Usage of Cash Deposit Machines: With Special Reference to Elpitiya Area
(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Suduwella, T.S.; Premarathne, W.G.I.D.
Introduction: More recently, E-Banking or financial services via electronic systems spreaded more among customers due to information technology improvement & through competition between banks. This study aims to investigate the factors affecting on usage of cash deposit machines in Elpitiya area in Sri Lanka. The Technology Acceptance Model (TAM) was used to fulfill the intention of the research. Design/Methodology/Approach: The study used simple random sampling as the sampling technique and related data were collected using a questionnaire. A random sample of 250 respondents were selected and distributed the questionnaire both as hard copies and Google forms where yielded a 100 percent response rate. Dependent variable for the study was usage of cash deposit machines & there were three independent variables as perceived ease of use, perceived usefulness, security & privacy and Reliability. This study used correlation test, multicollinearity test, regression test, and descriptive statics for analysis. Findings: The findings show that all the independent variables; Perceived ease of use, perceived usefulness, security & privacy and reliability have a significant effect on usage of cash deposit machines. At the same time, perceived usefulness is the most influencing factor for the Cash Deposit Machine usage in Elpitiya city. Conclusion: The study findings make a guidance to future researchers to find out other variables that are related to Cash Deposit Machine usage. Thus, this study contributes both to the practice and knowledge domain.
The Impact of Financial Literacy on Performance of Small and Medium Enterprises in Anuradhapura District
(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Prabodhani, S.P.; Premarathne, W.G.I.D.
Introduction: The performance and growth of Small and Medium-Sized Enterprises (SMEs) have throughout the nations, been of great concern to, among development economists, entrepreneurs, government, venture capital firms, financial institutions, and non-government organizations. This study aims to investigate the impact of financial literacy on performance of Small and Medium Enterprises in Anuradhapura district. Design/Methodology/Approach: This is a quantitative study done on using deductive approach. The study selected a sample 100 SMEs as using simple random sampling technique and data were collected using a structured questionnaire. Multiple Regression was used as the analysis technique and SPSS was used as the analyzing tool. Findings: As per the results of the study, all the independent variables; bookkeeping skills, financial planning and fixed assets management show a significant positive relationship with the performance of SMEs in Anuradhapura district. Thus, the research findings support to conclude that there is a significant positive impact of overall financial literacy on performance of SMEs in Anuradhapura district. Conclusion: This study concludes that it is crucial for SMEs to pay their attention more on improving knowledge on financial literacy related areas such as bookkeeping skills, financial planning and fixed assets management as they can make a huge impact on performance of their businesses. Moreover, the study contributes both in practice and knowledge domain.
Impact of Financial Literacy on Personal Financial Management: Evidence from Government Teachers in Kandy Education Zone, Sri Lanka
(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Bandara, J.M.U.; Premarathne, W.G.I.D.
Introduction: When existing in a world which is more financially driven rather than more trade driven, the quality of life depends upon the individual’s capacity to manage his/her financial affairs. Compared to industrialized nations, developing countries have a significantly lower financially informed populace. Consequently, financial education programs have risen in popularity. This study aims to examine the impact of financial literacy on personal financial management of government teachers in Kandy zone, Sri Lanka using investments and savings, spending patterns, debt management and retirement planning as the proxies of financial literacy. Design/Methodology/Approach: This study used the quantitative approach through distributing questionnaires to collect data and the random sampling technique was exercised in selecting a sample of 254 government teachers in Kandy zone as respondents. The data was analyzed by using the multiple regression analysis and SPSS software was utilized. Findings: The results of the study were evident enough to prove that financial literacy in all the aspects of savings, investments, spending patterns, debt management and retirement planning shows a positive and a significant impact on personal financial management. Spending patterns showed the highest impact on the personal financial management of teachers. Conclusion: The study findings make a guidance to future researchers to develop other variables that are related to teachers’ personal financial management behaviour. Thus, this study contributes both to the practice and knowledge domain.
The Impact of Risk Management on Firm Profitability: With Special Reference to the Commercial Banks in Sri Lanka
(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Soysa, W.D.M; Premarathne, W.G.I.D.
Introduction: Banks are crucial to the sustainability of any economy, because they facilitate business, trade, and the efficient deployment of idle funds. Banks also play an important role in implementing government monetary policies. However, banks’ incapacity to satisfy their intermediation commitments exposes the financial system to some risk. Thus, this study aims to identify the effect of risk management on firm profitability in Commercial banks in Sri Lanka. Design/Methodology/Approach: The research population is commercial banks in Sri Lanka and the study covered a period of 10 years from 2011 to 2020. Based on the market capitalization and relevance to the Sri Lankan context, 12 Domestic Licensed Commercial Banks were recognized as the sample for this study. Return on Assets and Return on Equity were utilized to assess financial performance in the study. Nonperforming advances, net interest income to total assets, loan to deposit and cost to income ratios were used to measure the impact of credit risk, market risk, liquidity risk and operational risk respectively. Further, descriptive statistics, correlation and regression analyses were applied to analyze the data Findings: According to the regression Analysis all independent variables had a significant impact on commercial banks’ financial performance except Loan to deposit ratio which represent the Liquidity risk. It had a positive insignificant impact on ROE. Moreover, still the same variables show a significant positive impact on ROA. Conclusion: According to the findings, banks should strike a healthy balance between financial risk management methods and financial performance by employing appropriate market, credit, liquidity and operational risk management practices that will protect their banks' safety while also yielding positive profits.
Stock Market Performance During the Covid 19 Pandemic in Sri Lanka
(Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka, 2021) Wasana, W.P.; Premarathne, W.G.I.D.
Introduction: With the covid 19 pandemic eruption, Sri Lankan economy began to collapse. Stock Market ranks among the best indicators of a country’s economic condition. This study focuses on identifying the impact of the covid 19 pandemic on performance of Colombo Stock Exchange. Design/Methodology/Approach: In this study monthly values of All Share Price Index (ASPI) and USD Exchange rate were used as independent variable; the monthly Total Return Index (TRI) value was also used as dependent variable to measure the Colombo Stock Exchange performance. Monthly data from March 2017 to February 2020 were used to show stock market performance before the covid 19 pandemic and monthly data from March 2020 to December 2020 were used to show Colombo Stock Exchange performance during the period of the covid 19 pandemic. Findings: The stock market performance during the Covid 19 pandemic was not the same as the stock market performance before the covid 19 pandemic. And the findings conclude that Covid 19 pandemic is negatively affecting the performance of the stock market. Conclusion: The study concludes that the performance on the Colombo Stock Exchange has declined due to the covid 19 pandemic, and the future researchers have an opportunity to improve the study using death rates etc. as well as independent variables for the study.