EVALUATING THE IMPACT OF FINANCIAL MANAGEMENT PRACTICES ON ORGANIZATIONAL PERFORMANCE: THE MEDIATING ROLE OF WORKING CAPITAL MANAGEMENT EFFICIENCY IN PAKISTAN'S SERVICE SECTOR
Abstract
This study investigates the mediating role of working capital management in the relationship between financial management practices and business performance. The research targets businesses operating in Rawalpindi and Islamabad, Pakistan, using a sample of 150 respondents from 35 industry sectors. Employing a quantitative approach and regression analysis, the study tested its hypotheses and evaluated the validity of the proposed model. Findings reveal that sound financial management practices significantly enhance business performance, contributing to greater stability and growth. Moreover, working capital management was found to strengthen the link between financial management and performance outcomes. The study highlights the importance of adaptive financial strategies in dynamic economic environments. However, limitations such as the cross-sectional design and limited sample size restrict generalizability. Future research should consider longitudinal designs with broader samples to validate these findings. Despite these constraints, the study contributes valuable insights to financial planning literature in Pakistan and underscores the strategic role of working capital management in improving organizational success.
Keywords: Financial Assessment, Working capital management , Organizational Performance, Rawalpindi-Islamabad Pakistan
