The Impact of Ownership Structure as a Balancing Factor on the Relation between the Free Cash Flow and Optimal Use of the Assets

2014 ◽  
Vol 4 (1) ◽  
pp. 407-422
Author(s):  
Daryush Javid ◽  
Seyed Ali Malihi ◽  
Elham Soheilian
Keyword(s):  
Cash Flow ◽  
Ownership Structure ◽  
Free Cash Flow ◽  
The Impact

scholarly journals Determinan Manajemen Laba Perusahaan di Sektor Konsumsi

2019 ◽  
Vol 3 (2) ◽  
pp. 96
Author(s):  
Muhammad Fajri
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Cash Flow ◽  
Institutional Ownership ◽  
Free Cash Flow ◽  
Earning Management ◽  
Managerial Ownership ◽  
Leverage Ratio ◽  
Good Corporate Governance ◽  
The Impact

The aim of this research is to provide empirical evidence on the impact of good corporate governance, free cash flow, and leverage ratio on earnings management. Good corporate governance is measured by audit committee’s size, the proportion of independent commissioners, institutional ownership, and managerial ownership. Discretionary accrual is the proxy of earning management. This research used 28 consumer goods companies listed in Indonesia Stock Exchange from 2016 to 2018. Data were analyzed using panel data with random effect model. Based on the result of analysis concluded that all components of good corporate governance (audit committee’s size, the proportion of independent commissioners, institutional ownership, and managerial ownership), have no significant effect on earnings management, on other hand leverage ratio has a negative effect and no significant on earning management, and free cash flow has a positve and no significant effect on earnings management

scholarly journals Financial Control Systems and Financial Systems Theory: Free Cash Flow and Profitability Nexus: a Comparative Study of Manufacturing Firms in Nigeria and Ghana

2020 ◽  
Vol 15 ◽  
Keyword(s):  
Cash Flow ◽  
Net Present Value ◽  
Performance Metrics ◽  
Positive Impact ◽  
Research Work ◽  
Manufacturing Firms ◽  
Free Cash Flow ◽  
Estimation Model ◽  
Financial Systems ◽  
The Impact

In Financial Systems, the impact of Free Cash Flow (FCF) on the performance of a company has been in the center of academic discourse in recent years. Several studies have tried to ascertain the nature and magnitude of the relationship between free cash flow and firm profitability with conflicting results coming from different scholars. The main objective of this research work was to examine the impact of FCF on the profitability of quoted manufacturing firms in the Nigerian and Ghana stock exchanges. Data were pooled from twenty (20) different companies (ten each from Nigeria and Ghana) for a period of six years (2012 – 2017). A panel data estimation model was used to measure the impact of FCF and other performance metrics on the Return on Assets (ROA), which is our chosen profitability measure. The results show a positive but insignificant relationship between FCF and ROA both for Ghana and Nigerian manufacturing firms. Also, sales growth showed a positive impact on profitability of both countries while leverage negatively impacted on profitability. with Ghana being significant at 5%. The implication of the findings of the study is that it makes no business sense for companies to keep piling up excess funds beyond that which is needed for transactional purposes. The similarity between the results from Ghana and Nigeria in most of the variables shows that the findings of this study can be generalized to other countries. Based on the findings of the study, we recommend that the management of companies should strive to keep only the minimum needed free cash flow while the rest should be invested in other projects with positive net present value

Corporate cash flow and dividends smoothing: a panel data analysis at Bursa Malaysia

2015 ◽  
Vol 13 (1) ◽  
pp. 2-19 ◽  
Author(s):  
Apedzan Emmanuel Kighir ◽  
Normah Haji Omar ◽  
Norhayati Mohamed
Keyword(s):  
Panel Data ◽  
Cash Flow ◽  
Panel Data Analysis ◽  
Generalized Method Of Moments ◽  
Cash Flows ◽  
Payout Policy ◽  
Free Cash Flow ◽  
Content Type ◽  
Financial Firms ◽  
The Impact

Purpose – The purpose of this paper is to contribute to the debate and find out the impact of cash flow on changes in dividend payout decisions among non-financial firms quoted at Bursa Malaysia as compared to earnings. There has been renewed debate in recent finance and accounting literature concerning the key determinants of changes in dividends payout policy decisions in some jurisdictions. The conclusion in some is that firms base their dividend decisions on cash flows rather than published earnings. Design/methodology/approach – The research made use of panel data from 1999 to 2012 at Bursa Malaysia, using generalized method of moments as the main method of analysis. Findings – The research finds that Malaysia non-financial firms consider current earnings more important than current cash flow while making dividends payout decisions, and prior year cash flows are considered more important in dividends decisions than prior year earnings. We also found support for Jensen (1986) in Malaysia on agency theory, that managers of firms pay dividends from free cash flow to reduce agency conflicts. Practical implications – The research concludes that Malaysian non-financial firms use current earnings and less of current cash flow in making changes in dividends policy. The policy implication is that current earnings are dividends smoothing agents, and the more they are considered in dividends payout decisions, the less of dividends smoothing. Social implications – If dividends smoothing is encouraged, it could lead to dividends-based earnings management. Originality/value – The research is our novel contribution of assisting investors and government in making informed decisions regarding dividends policy in Malaysia.

scholarly journals FACTORS THAT DETERMINE DIVIDEND POLICY ON BANKING IN THE INDONESIA STOCK EXCHANGE

2019 ◽  
Vol 18 (2) ◽  
pp. 145
Author(s):  
Mega Febriani ◽  
Farah Margaretha
Keyword(s):  
Cash Flow ◽  
Ownership Structure ◽  
Stock Exchange ◽  
Secondary Data ◽  
Free Cash Flow ◽  
Least Square ◽  
Board Structure ◽  
Growth Opportunity ◽  
Managerial Implications ◽  
Financial Characteristics

<p><em>The problem of this research was to test and analyze empirically the influence to financial characteristics, ownership structure and board structure that have significant effects on dividend decisions. The objective of this research was banking firm that listed in Indonesian Stock Exchange for period 2010-2017. The  methodology of this research was applies purposive sampling. The data obtained in this the secondary data was taken from Indonesian Stock Exchange. This research was panel least square model and processed using software eviews 9. Total number of samples is 27 companies. The purpose of this test is to prove the effect of the independent variables on the dependent variable.The result of this research shows that the financial characteristics, significant effected dividend decisions, meanwhile profitability, likuidity, free  cash  flow. Growth opportunity, age, size, leverage and asset tangibility does not effects the dividend decisions. Ownership structure significant effected dividend decisions, meanwhile institusional ownership and goverment ownership. And board structure significant effected dividend decisions, meanwhile independen director. The Managerial Implications from this research are how the company manages the capital sources from free cash flow and likuidity, how to make the company can be efficient in running the company and make earning.</em></p>

scholarly journals Pengaruh Struktur Kepemilikan, Free Cash Flow terhadap Kebijakan Dividen pada Perusahaan Asuransi yang Terdaftar di BEI Tahun 2013-2017

2018 ◽  
Vol 17 (2) ◽  
pp. 94
Author(s):  
Deaninda Sekar Pembayun ◽  
Subarjo Subarjo
Keyword(s):  
Cash Flow ◽  
Ownership Structure ◽  
Dividend Policy ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Institutional Ownership ◽  
Free Cash Flow ◽  
Managerial Ownership ◽  
Insurance Company ◽  
Beta Coefficient

This study aims to find out the Effect of Managerial Ownership Structure (MNJR), Institutional Ownership Structure (INST), Free cash flow (FCF), and the Ownership Structure on Dividend Policy of Insurance Company Registered on the Indonesia Stock Exchange 2013-2017. The population in this study amounted to 55 insurance companies listed on the Indonesia Stock Exchange in 2013-2017. The samples taken were 11 companies with purposive sampling techniques. Hypothesis testing is carried out using multiple linear regression analysis. The results of the study showed that (1) Managerial Ownership Structure does not affect the Dividend Policy as evidenced by the beta coefficient (B) of 0,000, t = -0,064 <t = 2,008, significance probability of 0,0950> 0,05 (2) ownership structure Institutional effect on Dividend Policy is proven by beta coefficient (B) of 0.020, t = 3.053> t = 2.008 and significance probability value of 0.004 <0.05 (3) Free cash flow does not affect Dividend Policy as evidenced by beta coefficient (B) 0,001, t = 1,904 <t = 2,008 and significance probability value of 0,063> 0,05 (4) probability Managerial Ownership Structure, Institutional Ownership Structure, Simultaneous Cash Flow affect the Dividend Policy as evidenced by the value F = 5,031> F = 4,238 , the significance probability value is 0.009 <0.05. Keywords: Managerial Ownership, Institutional Ownership, Free cash flow and Dividend Policy.

scholarly journals Kebijakan Dividen dari Perspektive Agency Cost Model (Studi Kasus Perusahaan yang Terdaftar di Bursa Efek Indonesia periode 2011-2013)

2016 ◽  
Vol 5 (1) ◽  
pp. 73
Author(s):  
Akhmad Hitten
Keyword(s):  
Cash Flow ◽  
Ownership Structure ◽  
Cost Model ◽  
Investment Decisions ◽  
Listed Companies ◽  
Agency Cost ◽  
Free Cash Flow ◽  
Dividend Policies ◽  
Main Model ◽  
Observation Period

The paper examines the influence of agency theory on dividend policies with free cash flow,maturity, capital structure, and ownership dividend variables. The sample used in this research isIndonesian listed companies with observation period from 2010 to 2013, and the data collectiontechnique used is data pooling or merging data. The data is analyzed with multiple linearregression analysis in SPSS program. The result of this study indicates that free cash flow,maturity, and ownership structure do not influence devidend policies, however capital structureinfluences dividend policies in Indonesian listed companies. The research also implies thatagency cost theory, as the main model of relevance dividend preposition, cannot explaindividend policies in Indonesian Companies. The investors cannot rely solely on dividend policiesin term of investment decisions in the future. 

Pengaruh Free Cash Flow, Operating Cash Flow, dan Dividend Payout Ratio Terhadap Nilai Perusahaan

2018 ◽  
Vol 10 (1) ◽  
pp. 52-65
Author(s):  
Suwaldiman Suwaldiman
Keyword(s):  
Cash Flow ◽  
Firm Value ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Multiple Linear Regression Analysis ◽  
Free Cash Flow ◽  
Manufacturing Companies ◽  
Dividend Payout ◽  
Operating Cash Flow ◽  
The Impact

            This research examines the impact of free cash flow, operating cash flow, and dividend payout ratio on the firm value which is represented by stock return.             This research employees a multiple linear regression analysis to test the hypothesis. Samples used in this research are 159 manufacturing companies registered in Indonesia Stock Exchange for the period of 2013, 2014, and 2015.             This research reveals that free cash flow and operating cash flow have no significant impact on the firm value. Those variables seem having no important contents in the point of view of investors. Therefore they do not response to the information. However, this research proves that dividend payout ratio have significant impact on the firm value. It can be concluded that dividend payout ratio is more important than those of free cash flow and operating cash flow. Investors will positively response to the dividend information and it will significantly increase the firm value.

Free Cash Flow and Firms' Growth: An Empirical Investigation of Nigerian Quoted Non - Financial Firms

2018 ◽  
Vol 10 (3(J)) ◽  
pp. 258-267
Author(s):  
Gideon Tayo Akinleye ◽  
Odunayo Magret Olarewaju ◽  
Kole Samson Fajuyagbe
Keyword(s):  
Cash Flow ◽  
Net Present Value ◽  
Negative Impact ◽  
Random Effect ◽  
Free Cash Flow ◽  
Percentage Change ◽  
Total Asset ◽  
Estimation Methods ◽  
Effect Estimation ◽  
The Impact

This study analyzes the effect of free cash flow on the growth of non- financial quoted firms in Nigeria. Specifically, the impact of free cash flow on the percentage change in a total asset of selected quoted firms (Dangote Flour Mills, Honeywell Nig. Plc, Dangote Sugar Refinery, Flour Mills of Nig. Plc, and PZ CussonsPlc) over a period of five years (2012 - 2016) was analysed . Data used in the study were sourced from the annual reports of the selected quoted firms. Correlation analysis, restricted F - test, Hausmantest, and some panel estimation methods (pooled OLS estimation, fixed effect estimation, and random effect estimation) were employed to analyse the data. Results revealed that free cash flow exerts a negative impact on firms ' growth rate, to the tune of - 0.000391(p=0.179 > 0.05). The study, therefore, established that rising free cash flow has the capacity to erode the growth prospect of firms quoted on the Nigeria stock exchange. Based on this result, the study recommends that quoted firms in the country decrease their free cash flow, leverage increased turnover, explore viable/positive net present value projects, and reduce operational costs so as to be positioned for better growth in terms of percentage change in total asset.

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