Causal Relationship between Working Capital Policies and Working Capital Indicators on Firm Performance: Evidence from Thailand

• 발행기관: 한국유통과학회
• 저자명: Sareeya WICHITSATHIAN
• 간행물 정보: 『The Journal of Asian Finance, Economics and Business(JAFEB)』The Journal of Asian Finance, Economics, and Business Vol. 9 No.5, 465~474쪽, 전체 10쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 2022.05.30

영문 초록

Using structural equation modeling, the study aims to investigate the causal relationship between working capital policies and working capital indicators on firm performance, including profitability and market value (SEM). The samples of 381 firms were selected from various industries listed on the Stock Exchange of Thailand (SET) from 2016 to 2020. The results showed that 1) there is an effect of working capital policies on profitability and market value; 2) there is an effect of working capital indicators on profitability and market value and 3) there is the effect of profitability on market value. From the results, it is suggested that conservative working capital investment policy (CIP) and conservative working capital financing policy (CFP) affect a company’s performance in the Thailand context. In addition, shortening the cash conversion cycle (CCC) should be applied in management to increase profitability by reducing the receivables collection period (RCP) and inventory conversion period (ICP) while increasing the payables deferral period (PDP). The practical implications of the study provide the evidence that meeting the dues according to short CCC management can represent healthy liquidity in cash flow that helps gain investor confidence and the investment interest that further increases the market value.

목차

1. Introduction

2. Literature Review

3. Research Methodology

4. Results and Discussion

5. Conclusion

References

키워드

Working Capital Management Working Capital Policies Working Capital Indicators Profitability Market Value Stock Exchange of Thailand