Abstract:
The purpose of this paper is to examine the effects of inflation and operating cycle
on cash holding in Tehran Stock Exchange in the period 2010 to 2014.The sample
is comprised of 103 companies which are selected by systematic elimination
method and total of 515 year-firm collected. In this study for testing the hypothesis
is used of linear regression and correlation. To analyse data and test hypotheses
is used of Eviews software. After designing and testing hypotheses for each
main hypothesis, it was concluded that inflation and operational cycle has not a
significant impact on the level of firm's cash holding. The results show no significant
effect of inflation through the operating cycle on cash holding.
Machine summary:
After designing and testing hypotheses for each main hypothesis, it was concluded that inflation and operational cycle has not a significant impact on the level of firm's cash holding.
Zhenxu [11] with investigating the effect of diversification on firm cash holdings in the New York Stock Exchange showed that the value of cash held by one-section companies is more than firms with several sections, and this negative relation is also in financial limited companies and other firms.
Malekian et al [6] examined the determinants of the amount of cash and their results showed that there is a negative relationship between size of the company, tangible fixed assets and leverage with the cash holding.
According to the hypothesis, because variables such as the price adjusting index and consumer price index to cash holding are significant in the model, so H0 is rejected, it means that there is a relationship between inflation and the level of cash holding.
Table 6: The estimation results of second hypothesis coefficients (View the image of this page) In Table 6, constant coefficient and variable coefficients such as operating cycle (repayment period of receivable accounts and inventory turnover period) to cash holding is in significance level of 5% and t-statistics for these variables is 2.
6 Discussion and Conclusion The aim of this study was to investigate the effect of inflation on cash holding and operating cycle of the company, in the period 2010 to 2014 in Tehran Stock Exchange.
, Inflation, operating cycle, and cash holdings, China Journal of Account- ing Research, 2014, 7(4), P.