The Impact of Inventory Movements on Financial Performance at Arab Potash Company

Abstract

The inventory of Spare parts is considered an important portion of the financial statement of capital-intensive companies, and they are classified according to their movements to fast moving, slow moving and unmoved (obsolete) Spare parts. The purpose of this research is to study the impact of inventory movements on the financial performance at Arab Potash Company. The study adopts the descriptive research approach. It will be conducted on the past nine years’ financial statements of Arab Potash Company to determine the impact relation on financial performance measures of profitability and liquidity indicators at Arab Potash Company. The findings are found significant on both profitability and liquidity measures, while the researcher provided some recommendation for the decision makers to mitigate the impact value on the firm.