Accounting Ratios as a Veritable Tool for Corporate Investment Decisions : A Study of Selected Organizations in Delta State

2015 ◽  
Vol 9 (5) ◽  
pp. 38-49
Author(s):  
Aniefor Sunday Jones ◽  
Oboro Oghenero Godday
Keyword(s):  
Investment Decisions ◽  
Corporate Investment ◽  
Accounting Ratios

scholarly journals Economic policy uncertainty and investment in Spain

SERIEs ◽  
2021 ◽  
Author(s):  
Daniel Dejuan-Bitria ◽  
Corinna Ghirelli
Keyword(s):  
Adverse Effect ◽  
Economic Policy ◽  
Strong Evidence ◽  
Investment Decisions ◽  
Corporate Investment ◽  
Precautionary Savings ◽  
Marginal Effect ◽  
Policy Uncertainty ◽  
Economic Policy Uncertainty ◽  
High Uncertainty

AbstractThe aim of this paper is to investigate the effect of economic policy uncertainty on firms’ investment decisions. We focus on Spain for the period 1998–2014. To measure policy-related uncertainty, we borrow the economic policy uncertainty (EPU) indicator available for this country. We find strong evidence that uncertainty reduces corporate investment. This relationship appears to be nonlinear, being the marginal effect of uncertainty attenuated toward zero during periods of high uncertainty levels. Furthermore, the heterogeneous results suggest that the adverse effect of uncertainty is particularly relevant for highly vulnerable firms. Overall, these results are consistent with the hypotheses that economic policy-related uncertainty reduces corporate investment through increases in precautionary savings or to worsening of credit conditions.

scholarly journals The Effects of Securities Class Action Litigation on Corporate Liquidity and Investment Policy

2015 ◽  
Vol 50 (1-2) ◽  
pp. 251-275 ◽  
Author(s):  
Matteo Arena ◽  
Brandon Julio
Keyword(s):  
Investment Decisions ◽  
Market Value ◽  
Corporate Investment ◽  
Class Action ◽  
Investment Policy ◽  
Capital Expenditures ◽  
Litigation Risk ◽  
Securities Litigation ◽  
Corporate Liquidity ◽  
Temporal Effects

AbstractThe risk of securities class action litigation alters corporate savings and investment policy. Firms with greater exposure to securities litigation hold significantly more cash in anticipation of future settlements and other related costs. The result is due to firms accumulating cash in anticipation of lawsuits and not a consequence of plaintiffs targeting firms with high cash levels. The market value of cash is lower for firms exposed to litigation risk. Corporate investment decisions are also affected by litigation risk, as firms reduce capital expenditures in response. Our results are robust to endogeneity concerns and possible spurious temporal effects.

scholarly journals Behavioral CEOs: The Role of Managerial Overconfidence

2015 ◽  
Vol 29 (4) ◽  
pp. 37-60 ◽  
Author(s):  
Ulrike Malmendier ◽  
Geoffrey Tate
Keyword(s):  
Empirical Evidence ◽  
Investment Decisions ◽  
Corporate Investment ◽  
Financing Constraints ◽  
Managerial Overconfidence ◽  
Empirical Framework

In this paper, we provide a theoretical and empirical framework that allows us to synthesize and assess the burgeoning literature on CEO overconfidence. We also provide novel empirical evidence that overconfidence matters for corporate investment decisions in a framework that explicitly addresses the endogeneity of firms' financing constraints.

The impact of board characteristics on corporate investment decisions: an empirical study

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ben Kwame Agyei-Mensah
Keyword(s):  
Regression Analysis ◽  
Board Of Directors ◽  
Investment Decisions ◽  
Corporate Investment ◽  
Independent Directors ◽  
Investment Efficiency ◽  
Content Type ◽  
Board Characteristics ◽  
The Board Of Directors ◽  
The Impact

Purpose The purpose of this study is to investigate the influence of board characteristics on firms’ investment decisions. Design Methodology Approach The study used data sourced from annual reports of firms listed on the Ghana Stock Exchange from 2014 to 2018. Descriptive analysis was performed to provide the background statistics of the variables examined. This was followed by a regression analysis which forms the main data analysis. Findings The multiple regression analysis results indicated that the proportion of independent directors and financial experts on the board are negatively related to firm investment. These findings imply that independent directors and financial experts on the board can help firms reduce overinvestment and improve investment efficiency. Originality Value The extant literature shows that the board of directors are an effective mechanism to reduce agency problems in firm decisions and operating performance. However, there has been little research on the role of the board of directors in corporate investment policy.

scholarly journals The Effects of Market and Macroeconomic Uncertainties on Corporate Investment Decisions in Nigeria

2021 ◽  
Vol 10 (4) ◽  
pp. 104-113
Author(s):  
Jonathan Oniovosa OSOSUAKPOR
Keyword(s):  
Exchange Rate ◽  
Interest Rate ◽  
Investment Decisions ◽  
Corporate Investment ◽  
Exchange Rate Policy ◽  
Stock Market Volatility ◽  
Market Uncertainty ◽  
Corporate Investments ◽  
Exchange Rate Uncertainty ◽  
Significant Difference

In this paper, the effect of market and macroeconomic uncertainties on corporate investment decisions was examined using the real option investment theory. Two types of uncertainties were investigated: macroeconomic uncertainties (exchange, interest and inflation rates) and market uncertainty (stock market volatility) while corporate investments were measured as the sum of the changes in capital stock and depreciation. Data were obtained for the period 2005-2019 and the Generalized Autoregressive Conditional Heteroskedasticity (GARCH) estimation technique was employed. The results showed a significant difference between the effects of macroeconomic and market uncertainties on corporate investment decisions. We found that macroeconomic uncertainty of inflation rate has positive relationship with corporate investments, with a coefficient of 0.35071, and interest rate uncertainty (0.15567) and exchange rate uncertainty (-0.07852) were also statistically significant, whereas the linear market uncertainty has a negative value of -0.00173 and the quadratic market uncertainty (0.00520) was statistically insignificant. Therefore, interest rate volatility and inflation expectations are not factors constraining investment growth; however, exchange rate uncertainty exerts a substantial negative influence on corporate investment in Nigeria. Given the findings, the study recommends, among others, an appropriate and stable exchange rate policy that makes for easy business planning and forecasting by rational investors. To achieve a stable exchange rate that would bring about increased investment, the government should implement efficient macroeconomic policies, such as those that minimize the structural rigidities in the economy.

scholarly journals MAXIMIZING THE PROFITABILITY ON INVESTMENT BY OPTIMIZING THE PRODUCTION PROGRAM

2021 ◽  
Vol 2021 (4) ◽  
pp. 4913-4917
Author(s):  
JAROSLAVA KADAROVA ◽  
◽  
JAROSLAVA JANEKOVA ◽  
DANIELA ONOFREJOVA ◽  
◽  
...  
Keyword(s):  
Monte Carlo Simulation ◽  
Monte Carlo ◽  
Economic Efficiency ◽  
Production Capacity ◽  
Investment Decisions ◽  
Corporate Investment ◽  
Business Investment ◽  
Production Program ◽  
Future Production ◽  
Fixed Assets

Investments in tangible fixed assets significantly affect the future production capacity of the company, they are a stimulator of the company's development. At the same time, they are associated with a degree of uncertainty that needs to be taken into account when making investment decisions. The article presents an approach to optimizing inhomogeneous production in order to maximize the economic efficiency of a particular business investment. The economic efficiency of the investment is assessed comprehensively in terms of profitability, liquidity and risk. The risk is addressed through Monte Carlo simulation and the production program is optimized using OptQuest. The result is a production program that maximizes the return on the assessed corporate investment.

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