Open AccessPosted Content
Does Working Capital Management Affect Profitability of Belgian Firms
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TL;DR: In this paper, the relation between working capital management and corporate profitability is investigated for a sample of 1009 large Belgian non-financial firms for the 1992-1996 period, and the results suggest that managers can increase corporate profitability by reducing the number of days accounts receivable and inventories.
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Abstract: The relation between working capital management and corporate profitability is investigated for a sample of 1009 large Belgian non-financial firms for the 1992-1996 period. Trade credit policy and inventory policy are measured by number of days accounts receivable, accounts payable and inventories, and the cash conversion cycle is used as a comprehensive measure of working capital management. The results suggest that managers can increase corporate profitability by reducing the number of days accounts receivable and inventories. Less profitable firms wait longer to pay their bills.
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Managing Efficiency and Profitability Through Working Capital: an Empirical Analysis of BSE 200 Companies
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- 01 Jan 2013
TL;DR: In this paper, the authors analyzed the working capital performance of 164 manufacturing BSE 200 companies classified into 19 industries over the period of 2000-2010 based on working capital score calculated by using normalised values of Cash Conversion Efficiency, Days Operating Cycle and Days Working Capital.
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The effect of inventory performance on product quality: The mediating effect of financial performance
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TL;DR: In this article, the authors investigated the relationship between inventory performance and product quality, and examined the mediating effect of financial performance on this relationship, and found that the effect of inventory performance on product quality is partially mediated by financial performance.
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References
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Law and Finance
Rafael La Porta,Rafael La Porta,Florencio Lopez de Silanes,Florencio Lopez de Silanes,Andrei Shleifer,Andrei Shleifer,Robert W. Vishny,Robert W. Vishny +7 more
TL;DR: This paper examined legal rules covering protection of corporate shareholders and creditors, the origin of these rules, and the quality of their enforcement in 49 countries and found that common law countries generally have the best, and French civil law countries the worst, legal protections of investors.
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Mitchell A. Petersen,Mitchell A. Petersen,Raghuram G. Rajan,Raghuram G. Rajan,Raghuram G. Rajan +4 more
TL;DR: In this article, the authors focus on a sample of small firms whose access to capital markets may be limited and find evidence that firms use trade credit relatively more when credit from financial institutions is not available.
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TL;DR: In this paper, the authors consider trade credit as a way that firms can guarantee product quality, rather than as a means of financing less creditworthy firms, and seek, and provide, possible explanations for observed phenomena such as relatively shorter (or no) trade credit terms for consumer and food products and relatively longer terms for heavy industrial equipment.
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Trade Credit, Financial Intermediary Development and Industry Growth
TL;DR: In this paper, Fisman and Love show that in countries with relatively weak financial institutions, industries with greater dependence on trade credit financing (measured by the ratio of accounts payable to total assets) grow faster than industries that rely less on such credit.
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