- Title
- Determinants of capital structure of small and medium enterprises in the Buffalo City Municipality Eastern Cape Province South Africa
- Creator
- Rungani, Ellen Chenesai
- Subject
- Debt-to-equity ratio
- Subject
- Capital
- Subject
- Value
- Subject
- Business enterprises -- South Africa -- Eastern Cape
- Subject
- Small business -- South Africa -- Eastern Cape
- Subject
- Municipal government -- South Africa -- Eastern Cape
- Date Issued
- 2009
- Date
- 2009
- Type
- Thesis
- Type
- Masters
- Type
- M Com (Business Management)
- Identifier
- vital:11317
- Identifier
- http://hdl.handle.net/10353/271
- Identifier
- Debt-to-equity ratio
- Identifier
- Capital
- Identifier
- Value
- Identifier
- Business enterprises -- South Africa -- Eastern Cape
- Identifier
- Small business -- South Africa -- Eastern Cape
- Identifier
- Municipal government -- South Africa -- Eastern Cape
- Description
- This study investigated the determinants of capital structure of small and medium enterprises (SMEs) in the Buffalo city municipality in the Eastern Cape Province of South Africa. The objectives of the study were, to ascertain whether the use of internal equity (retained profits) was positively or negatively related to the size, age and profitability of the firm. Furthermore the study examined if the use of external equity (capital from owners) was negatively or positively related to the age, size and profitability of the firm. Finally the study wanted to establish if the use of debt was positively or negatively related to the size, age and profitability of the firm. To achieve these objectives, the study hypothesised that age, size and profitability amongst other factors were determinants of capital structure. The study further hypothesised that the use of retained profits by SMEs was negatively related with age, size and profitability of the firm. Furthermore the study hypothesised that the use of external equity by SMEs was negatively related with age, size and profitability of the firm. Finally, the study hypothesised that the use of debt by SMEs was negatively related to the size, age and profitability of the firm. The results revealed that size, age and profitability of the firm were some of the major determinants of capital structure. Finally, the study recommended that SMEs, commercial banks and the South African government take measures to improve access to capital by SMEs. Such measures included government intervention in reducing discrimination from the banks as well as encouragement of SMEs training and education so that they are empowered with business and financial management skills.
- Format
- 218 leaves; 30 cm
- Format
- Publisher
- University of Fort Hare
- Publisher
- Faculty of Management & Commerce
- Language
- English
- Rights
- University of Fort Hare
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UFH Department of Business Management
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