Partial fulfillment of the requirements for the degree of Masters of Commerce.

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Efficient working capital management is one of the pre-conditions for the continued existence of
organizations. This study examined the efficiency of working capital management (WCM) in
Tanzanian universities. A sample of 8 out of 31 universities in Tanzania for a period from year
2005 to 2009 was studied. To measure the efficiency of WCM, three index values namely
performance, utilization, and efficiency indices were computed. Different variables affecting
WCM efficiency including return on assets (ROA), earnings before interest and tax (EBIT),
number of computers and computer software were studied. Further, university sizes, growth in
number of students, and type of university (Government or Private) were used as control
variables. The data were analyzed using descriptive statistics, Pearson’s correlation and
regression. The findings of the study indicate that Tanzanian universities have managed their
working capital satisfactorily. The result shows that there is a positive relationship between
WCM efficiency and university’s earnings. This means that the higher the earnings, the greater
the measure of efficiency in working capital management. The study also found a positive
relationship between number of computers and working capital management efficiency. It
implies that an increase in number of computers with proportion to the number of finance staff
lead to the efficiency in WCM.