scholarly journals Does a Pro-Environmental Firm Attract Future Cash Flow? With an Impact of Sustainable Advertisement on Firms’ Financial Performance

2021 ◽  
Vol 13 (3) ◽  
pp. 1348
Author(s):  
Jaehong Lee ◽  
Suyon Kim
Keyword(s):  
Cash Flow ◽  
Stock Exchange ◽  
Sustainable Growth ◽  
Public Image ◽  
Superior Performance ◽  
Organization Management ◽  
The Public ◽  
Future Cash Flow ◽  
Active Involvement ◽  
The Future

This study investigates the future existence of firms that are engaged in environment-oriented activities. Recently, strategic activities for firms’ sustainable growth has been critical for the environment. We use regression analysis to examine the relationship using firms listed in the Korea Stock Exchange market from 2014 to 2018. We use five aspects of environment-oriented activities: organization, management, strategy, performance, and shareholders, provided by the Korea Corporate Governance Service. The empirical results indicate that the firms participating in environment-oriented activities are likely to predict future cash flow, implying firms’ sustainability. We also claim that firms engaged in environment-oriented activities are likely to advertise their pro-environmental engagements, resulting in firms’ sustainable existence in the future. These findings are robust when we use the aggregate value as an alternative measurement. Our finding provides useful information for corporate practice. Active involvement in environmental activities can be used as a strategy that leads to superior performance. These efforts will contribute to enhancing the public image and improving green competitiveness. From the perspective of regulators, the non-financial information assessment supports the government’s eco-friendly policy that emphasizes environment-oriented activities. The results indicate that transparent information for external investors seeking to invest in firms are engaged in environment-oriented activities.

scholarly journals The Influence of Future Cash Flow Predictions on Profits in Companies Listed on the Indonesia Stock Exchange

2021 ◽  
pp. 026-033
Author(s):  
Titik Purwanti
Keyword(s):  
Cash Flow ◽  
Stock Exchange ◽  
Cash Flows ◽  
Net Income ◽  
Purposive Sampling ◽  
Future Cash Flow ◽  
Operating Profit ◽  
Food And Beverage ◽  
Future Cash Flows

This research was conducted to determine the effect of future cash flow predictions on profits (gross profit, operating profit, and net income) in food and beverage companies listed on the Indonesia Stock Exchange. The method used in this research used purposive sampling with a population of food and beverage companies listed on the Indonesia Stock Exchange for the period 2016-2018. The samples in this research were 19 companies. The results obtained indicate that the operating profit variable has a partial effect on future cash flows, while the net income variable and the gross profit variable do not partially affect future cash flows. Simultaneously, gross profit, operating profit and net income have an effect on future cash flows.

scholarly journals Analysis of Fundamental Indexation as an Efficient Approach to Active Investing

2018 ◽  
Vol 6 (4) ◽  
pp. 41-51
Author(s):  
M. Volkov
Keyword(s):  
Stock Exchange ◽  
Superior Performance ◽  
Theoretical Rationale ◽  
Efficient Approach ◽  
Weighted Index ◽  
Future Performance ◽  
The Future ◽  
Passive Investing ◽  
The Uk ◽  
Investment Portfolios

For many years researchers have been arguing on whether active investing is superior to passive investing by giving theoretical and empirical rationale underlying their beliefs. A desire to over-perform passive investing by utilising fundamentally-justified methodology has led to the development of numerous active and semi-active strategies, such as Fundamental indexation established in 2005 by Arnott et. al. In their research, the authors suggested constructing investment portfolios by assigning the weights of each asset concerning the values of its fundamental indicators. This approach has met heavily critique for the lack of theoretical rationale, by not being able to connect the values of selected fundamental indicators to the future performance of the portfolio. In this research, the thesis of passive investing superiority has been challenged by constructing an active investing strategy based on Fundamental Index described by Arnott et al. (2005) - Modified Fundamental Index and testing it on the UK stock exchange companies. The resulted portfolio showed superior performance compared to the cap-weighted index while also having lower risks and higher diversification. Also, I suggested some ideas for further research concerning MFI.

scholarly journals Foreign Monitoring and Predictability of Future Cash Flow

2019 ◽  
Vol 11 (18) ◽  
pp. 4832
Author(s):  
Jaehong Lee ◽  
Eunsoo Kim
Keyword(s):  
Cash Flow ◽  
Stock Exchange ◽  
Predictive Ability ◽  
Financial Statements ◽  
Cash Flows ◽  
Foreign Investors ◽  
Future Cash Flow ◽  
Flow Components ◽  
Future Cash Flows

A company’s sustainability is generally determined by whether it is able to create a positive long-term cash flow. This paper investigates whether the predictive ability of cash flows and earnings in forecasting future cash flows differs depending on the foreign investors’ ownership. Based on firms listed in the Korea Stock Exchange market from 2000 to 2017, we find that earnings and cash flow components of financial statements enhance the predictability of future cash flow in the Korean stock market. Conversely, foreign investors showed a tendency to decide on investments based on operating cash flow instead of earnings when predicting future cash flow. These findings indicate that reliability towards earnings may fall since foreign investors’ concerns are on the prospects of earnings management. These results were strengthened by the addition of several more analyses including cluster analyses, consideration of information asymmetry and the chaebol governance.

Relationship between earnings management, CEO compensation, and stock return on Tehran Stock Exchange

2019 ◽  
Vol 23 (1) ◽  
pp. 1-22
Author(s):  
Mahdi Moardi ◽  
Mahdi Salehi ◽  
Simin Poursasan ◽  
Homa Molavi
Keyword(s):  
Earnings Management ◽  
Cash Flow ◽  
Significant Relationship ◽  
Stock Return ◽  
Stock Exchange ◽  
Discretionary Accruals ◽  
Content Type ◽  
Future Cash Flow ◽  
Accruals Quality ◽  
The Relationship

Purpose The purpose of this paper is to investigate the relationship between earnings management and chief executive officers’ (CEOs) compensation. Owing to the fact that earnings management does not have only opportunistic effects, but signaling effects, this study focuses on accruals quality to examine earnings management incentives. Thus, accruals quality is described against future cash flow. The empirical evidences suggest that a positive relationship between discretionary accruals and future cash flow provides predictive elements for earnings management, whereas a negative relationship between discretionary accruals and future cash implies to opportunistic elements for earnings management. Should there is no significant relationship between discretionary accruals and future cash flow, there will be no earnings management, and such a result suggests that incentives and managers’ performance in these firms differ. Design/methodology/approach The statistical population of this research consists of all listed companies on the Tehran Stock Exchange during 2009–2016. Panel data method is applied in order to estimate the research model. Findings Findings of the study show that there is no significant relationship between discretionary accruals and future cash flow in pharmaceutical and food industries, thus they have neither predictive nor opportunist earnings management, while the results evidence a negative significant relationship between discretionary accruals and future cash flow in machineries, automobile, mineral and chemical industries. Furthermore, it can be alleged that there is no significant difference between CEOs’ compensation in firms with opportunistic earnings management (OEM) and other types of earnings management. It shows that firms do not have appropriate plans for CEOs’ compensation. Moreover, the relationship between earnings management and stock return has been investigated in this study. We document that stock return is influenced by accruals quality and its components. In other words, stock return significantly differs in firms with OEM and firms without any kind of earnings management. Research limitations/implications The authors’ findings provide contributions; for managers, it is noticeable that stock markets have sufficient comprehension about financial statements and the undertaken procedures on them, resulting in a higher return base on fair information. For investors and regulators, using the findings, may have deeper understanding to distinguish between industries that are recognized as opportunistic and non-opportunistic, which, in turn, results in better decision and regulation. Originality/value Previous studies have been mostly investigated OEM, while the current study examines both signaling and opportunistic aspects of earnings management.

scholarly journals PENGARUH EARNING DAN CASH FLOW OPERATION TERHADAP ARUS KAS MASA DEPAN

2021 ◽  
Vol 2 (1) ◽  
pp. 108-121
Author(s):  
Naz'aina Naz'aina ◽  
Chairunnisa Chairunnisa
Keyword(s):  
Cash Flow ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Secondary Data ◽  
Financial Statements ◽  
Analysis Model ◽  
Future Cash Flow ◽  
Result Show ◽  
Independent Variable ◽  
Multi Linear Regression

This study is an empirical study that aims to analyze the effect of earning and cash flow operation on future cash flow. The type of data used in this study is secondary data from each companies financial statements in consumer goods sector that listed on Indonesia Stock Exchange in 2014-2018. The number of samples in this study were 27 companies that selected by purposive sampling method. The independent variable used are earning and cash flow operation in 2014-2017, while dependent variable is future cash flow in 2015-2018. The analysis model used in this research is multi linear regression analysis using Eviews 11. 11. The result show that the earning variable has negative and significant effect on future cash flow. The cash flow operation variable has positive and significant effect on future cash flow. Thus, earning and cash flow operation simultaneously have positive and significant effect on future cash flow.

scholarly journals Analysis of Islamic Banks’ Merger in Indonesia

2021 ◽  
Vol 4 (2) ◽  
pp. 112-120
Author(s):  
Fitri Mareta ◽  
Heliani Heliani ◽  
Siti Elisah ◽  
Andini Ulhaq ◽  
Indri Febriani
Keyword(s):  
Market Share ◽  
Cash Flow ◽  
Islamic Law ◽  
Stock Exchange ◽  
Profit Sharing ◽  
Free Cash Flow ◽  
Islamic Banks ◽  
Discounted Cash Flow ◽  
The Public ◽  
Relative Valuation

Islamic bank is a bank that collects funds from the public by using system profit sharing for every profit it gets and in carrying out its activities in accordance with Islamic law. Remembering that in Indonesia most of the population is Muslim, therefore they need a bank that works in accordance with Islamic law. Considering the number of percentages of Islamic banks in Indonesia are still small and cannot yet dominate the market share, therefore this research is expected to find out whether the merging of 3 Islamic banks (BRIS, BSM and BNIS) able to control market share or not. To see the synergy resulting from this merger is used methods Discounted Cash Flow - Free Cash Flow to Equity and Relative Valuation - Price to Book Ratio. The data used are the financial statements of each bank from 2014 to 2019 which are available on the Indonesia Stock Exchange (IDX) or the websites of each bank.

scholarly journals Does Human Resource Investment for Internal Control System Enhance Future Cash Flow Predictability?

2020 ◽  
Vol 12 (20) ◽  
pp. 8500
Author(s):  
Jaehong Lee ◽  
Suyon Kim
Keyword(s):  
Control System ◽  
Human Resource ◽  
Cash Flow ◽  
Internal Control ◽  
Stock Exchange ◽  
Future Cash Flow ◽  
Resource Investment ◽  
Internal Control System ◽  
Cash Flow Forecasting

Generating positive long-term cash flow is vital for a firm’s sustainability. In this paper, we consider the earnings in the forecasting of future cash flow from a human resource investment of an internal control system. Using the firms listed in the Korea Stock Exchange market from 2014 to 2018, we find that the current earnings are the components of cash flow forecasting, and this relationship is genuine in a firm equipped with sufficient internal control personnel and their experiences. These findings indicate that earnings are reliable when forecasting future cash flow for a firm with a well-operated foundation.

scholarly journals PENGARUH EARNINGS, CASH FLOW FROM OPERATIONS, WORKING CAPITAL FROM OPERATIONS, DAN ACCRUAL COMPONENTS TERHADAP FUTURE CASH FLOW PADA PERUSAHAAN MANUFAKTUR YANG TERDAFTAR DI BURSA EFEK INDONESIA

2017 ◽  
Vol 20 (2) ◽  
Author(s):  
Sofia Prima Dewi ◽  
Venny Gunawan
Keyword(s):  
Data Analysis ◽  
Empirical Evidence ◽  
Cash Flow ◽  
Stock Exchange ◽  
Manufacturing Companies ◽  
Working Capital ◽  
Future Cash Flow ◽  
Software Program

The purpose of this study was to obtain empirical evidence about the effect of earnings, cash flow from operations, working capital from operations, and accrual components to future cash flow in manufacturing companies listed in Indonesia Stock Exchange. The samples used were 165 manufacturing companies listed in Indonesia Stock Exchange during 2010-2012. Data analysis was performed with the aid of a software program Statistical Product and Service Solutions (SPSS)for Windows. The results showed that earnings, cash flow from operations, and working capital from operations have an influence on future cash flow, while accrual components does not have any influence on future cash flow.

scholarly journals KEAKURATAN MODEL ARUS KAS METODE LANGSUNG DALAM MEMPREDIKSI ARUS KAS DAN DIVIDEN MASA DEPAN (STUDI EMPIRIS PADA PERUSAHAAN MANUFAKTUR YANG TERDAFTAR DI BURSA EFEK INDONESIA TAHUN 2009-2012)

2018 ◽  
Vol 2 (1) ◽  
pp. 10-17
Author(s):  
Eka Julianti Efris Saputri
Keyword(s):  
Cash Flow ◽  
Prediction Models ◽  
Stock Exchange ◽  
Direct Method ◽  
Ordinary Least Squares ◽  
Least Squares Regression ◽  
Flow Models ◽  
Future Cash Flow ◽  
Paired Samples ◽  
Operating Activities

The research was perfomed to determine the accuracy of the direct method cash flow models in predicting future cash flow and dividend. This study aims to test the accuracy of the models direct cash flow method in predicting future cash flow and dividend. The study evaluated cash flow and dividend prediction models, that employed cash inflows from operating activities and cash outflows for operating activities. Populations in the study are all of manufacturing firmsthat listen on Indonesian Stock Exchange in the period of 2009-2021. In this study, samples taken by purposive sampling metod  on certain criteria.  the  research  gets 15firms  from 131 firms which mathc with criteria. Establishment of Prediction Model using Ordinary Least Squares regression analysis, and hypothesis testing done with test Paired Samples T-Test.  The results of this study showed that the models of the direct method cash flow accurately in predicting future cash flow and dividend.  

scholarly journals The Relative Ability of Earnings and Cash Flow from Operations in Predicting Future Cash Flows: Evidence from India

2015 ◽  
Vol 5 (2) ◽  
pp. 178 ◽  
Author(s):  
Mwila Joseph Mulenga
Keyword(s):  
Cash Flow ◽  
Stock Exchange ◽  
Cash Flows ◽  
Least Square ◽  
Financial Accounting ◽  
Financial Accounting Standards Board ◽  
Financial Status ◽  
Ordinary Least Square ◽  
Future Cash Flow ◽  
Least Square Approach

The current study examines ability of earnings and cash flow from operations in predicting future cash flow from operations of Indian companies listed in Bombay stock exchange from 2002 to 2014. The study used cash flow from operations directly reported in the cash flow statement. For the purpose of estimating regression models, Ordinary least square approach used and in measuring the predictive power of each models in forecasting future cash flow adjusted R-squared used as forecasting measure. The findings of this study reported cash flow from operations to have more power in than earnings in predicting future cash flow, which do not support the assertion given out by Financial Accounting Standards Board. The findings of this study provide additional insights to Indian capital market researchers and also benefit users of accounting information in India by providing them with empirical evidence on the beneficial ability of cash flow data in predicting future cash flow and that would assist them in making their investment decisions, lending and other decisions and also knowing the financial status of company they wish to invest.

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