1.1. Problem Statement Credit risks are important with an organization because the can determine its success or failure. The amount of revenue generated also depends on the same. It is therefore important for ABC groups to take such measures seriously so as to ensure that it runs according to the set objectives.

Poor credit management, inadequate credit policies and quantitative methods of credit assessment and poor evaluation and monitoring systems lead to poor credit policies in business (Addae-Boateng et al. 2013). The absence of updated credit policies and ineffective monitoring credit policies leads to the failure of a business due to the increase in default rate of customers.The credit management section exposes ABC groups to high risks that may lead to financial challenges including bankruptcy.Singh (2014), show that in the current world, there is rapid movement of cash and increased borrowing and lending of funds. Few groups are not affected by borrowers nonpayment of obligation from loans.

ABC groups develop strategies so as to either reduce or eliminate the credit risk. In the management of such risks, such groups must be concerned with financial performance. In spite of the efforts that are made to address poor credit management, ABC groups have difficulties that result from credit management processes.1.2. Research Objectives i).

        To design an effective cash management policy for smooth cash procurement and disbursement of ABC FMCG divisionsii).     To identify the level of working cash balance of ABC and how to maximize the unused funds.iii).  To identify the cash conversion cycle of ABC FMCG divisions with the support of RCP, ICP and PDP through the technique of ratio and other statistical analysis tools.1.

3. Aim of the Study This study seeks to analyze cash conversion cycle, cash holding, cash flow as well as creditworthiness of the ABC Groups FMCG Divisions between 2011 and 2014. Besides, this study will also analyze financial performances of three FMCG divisions of ABC group namely: Yoma Strategic Holdings Company, Oriental Foods Company Limited and Chue Wing & Co.1.4. Major Financial RatiosThere are five main financial ratios that are used in financial accounting for corporate enterprises.

This study will however concentrate on three main ratios particularly in the application to analysis of financial performance of the companies. These ratios are particularly employed in the analysis of financial statements:i).        Leverage Ratio: This ratio measures the extent to which firms financing with regard to debts to equity are concerned. This ratio also focuses on the ability of the firms to cover the interests as well as other fixed leveled charges.ii).

     Liquidity ratio: this ratio is commonly used in the measurement of the abilities of companies to meet their own cash demands any time they arise. The ability of a firm particularly in the FMCG to meet these charges is very important as it constitutes the ability of the companies to maintain their performance capacities in the long-run due to the dynamic nature of the business elements.iii).  Profitability ratio: This ratio basically measures the entire performance of a company as well as its efficiencies in the management of assets, equity and liabilities that are essential to influencing the prospects of cash flows in a firm.