Vahid Taghizadeh Khanqah; Mohsen Akbari Khosroshahi; Mohammad Reza Ebrati
Volume 2, Issue 3 , July 2012, , Pages 203-218
Abstract
Working capital management is an essential part of the short-term finance of a firm. With an efficient working capital management, a firm can release capital for more strategic objectives, reduce the financial costs, and improve profitability. The present research studies the relationship of ...
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Working capital management is an essential part of the short-term finance of a firm. With an efficient working capital management, a firm can release capital for more strategic objectives, reduce the financial costs, and improve profitability. The present research studies the relationship of working capital management on performance of firms Listed in Tehran Stock Exchange (TSE). Average Collection Period, Inventory Turnover in days, Average Payment Period, Cash Conversion Cycle, and Net Trading Cycle were used to assess working capital management, and Net Operating Profitability was used to assess firms performance. The findings of studying 50 firms during the period between 2006 and 2009 by using an Ordinary Least Square Method (OLS) showed that there would be a negative and significant relationship between the variables of Average Collection Period, Inventory Turnover in day, Average Payment Period, Net Trading Cycle and the performance of firms Listed in Tehran Stock Exchange (TSE). There were no evidences to prove the existence of a significant relationship between Cash Conversion Cycle and the firms performance (NOP) for all years from 2006 to 2009. The results showed that the increase in Collection Period, Payment Period, and Net Trading will lead towards the reduction of profitability in the firm. In other words, managers can increase the profitability of their firms reasonably, by reducing Collection Period, Inventory Turnover, and Payment Period.
Vahid Taghizadeh Khanqah; Mohsen Akbari Khosroshahi; Elham Ghanavati
Volume 2, Issue 1 , January 2012, , Pages 1-12
Abstract
In modern economics, Intellectual capital is described as an intangible asset which can be used as a source of sustainable competitive advantage. However, intellectual capital components have to interact in themselves to create value. The paper seeks to examine the impact of intellectual capital on firms’ ...
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In modern economics, Intellectual capital is described as an intangible asset which can be used as a source of sustainable competitive advantage. However, intellectual capital components have to interact in themselves to create value. The paper seeks to examine the impact of intellectual capital on firms’ market value and financial performance. The efficiency of the value added by corporate intellectual ability (Value Added Intellectual Coefficient) is incorporated to measure the intellectual capital construct. The analyses are performed using data derived from the financial statements of 28 firms listed on the Tehran Stock Exchange (TSE) during a four-year period from 2006 to 2009. Correlation and Ordinary Least Square (OLS) regressions have been carried out on panel data to check the impact of intellectual capital on firms’ market value and financial performance. Results failed to support most of the hypotheses, only concluding that there is a statistically significant relationship between structure capital efficiency and financial performance (ROE, ROA). Despite the fact that intellectual capital is increasingly recognized as an important strategic asset for sustainable corporate competitive advantages, the results of the present study give raise to various arguments, criticism and further research on the subject.