Esther Ijeoma Awuzie, Matthew Okechukwu Nwokoye, Mwuese Patricia Kuma


This study investigated the relationship between financial analysis and performance of small and medium enterprises in Makurdi. The study adopted descriptive research design and utilized secondary source of data. The population of the study consists of ten chosen SMEs registered in the State ministry of commerce and industry and have operated for seven years. The analysis of data collected was done using descriptive statistics and mean scores while the test of hypotheses was through the application of chi-square technique. The findings revealed that; the mean average of return on asset (ROA) for most SMEs is 2.83% which is less than the 3.00 threshold. The mean average of return on equity (ROE) for most SMEs is 20.45% which is high showing that SMEs generate profits from shareholders investments. The mean average for net interest margin (NIM) for SMEs is 2.88% which is less than 3.00 showing less management decision making for profit generalization. Based on the findings the following recommendations were made; SMEs operating in Makurdi should ensure proper assessment of ROA before taking investment decision. This will help improve their performance. Most SMEs studied seem not to have shareholders; this reflected on the low profitability from the shareholders’ investment. SMEs should be able to accommodate other business partners as shareholders. This decision can help improve their profit over time. Net interest margin of every SME should be considered before taking business decisions for the attainment of high business performance.


Relationship, Financial Analysis, Performance, SMEs, Makurdi Metropolis.

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