Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia

Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia

The study aims to investigate the determinants of working capital management (WCM) on a sample of 57 Malaysian firms in three different scenarios of 2008 global financial crisis, before (2002-2006), during (2007-2008) and after the global financial crisis (2009-2012). Six explanatory variables commo...

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Main Authors: Haron, Razali, Mansour Nomran, Naji
Format: Conference or Workshop Item
Language:English
Published: 2015
Subjects:
HG4001 Financial management. Business finance. Corporation finance.
Online Access:http://irep.iium.edu.my/45889/
http://irep.iium.edu.my/45889/
http://irep.iium.edu.my/45889/1/45889.pdf
id iium-45889
recordtype eprints
spelling iium-458892018-03-06T04:29:35Z http://irep.iium.edu.my/45889/ Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia Haron, Razali Mansour Nomran, Naji HG4001 Financial management. Business finance. Corporation finance. The study aims to investigate the determinants of working capital management (WCM) on a sample of 57 Malaysian firms in three different scenarios of 2008 global financial crisis, before (2002-2006), during (2007-2008) and after the global financial crisis (2009-2012). Six explanatory variables commonly cited were employed to identify variations in cash conversion cycle (CCC) which acts as the measurement for WCM in this study. These variables are profitability, debt, sales growth, free cash flow, firm size and liquidity. By employing pooled OLS and random effect model, it was found that four out of the six explanatory variables have significant relationships with WCM before the crisis. These factors are profitability, debt; sales growth and firm size. It is interesting to note that the same variables have significant relationships with WCM as well after the crisis of 2008. Thus, firms should take note that when dealing with WCM during non-crisis periods, they should give particular attention to profitability, debt; sales growth and firm size. In contrast, it was found that profitability, firm size and free cash flow are significantly affecting WCM during the financial crisis of 2008. With this extra information on the contributing factors to effective WCM of a firm during these three important periods, this study has filled the gap in the body of knowledge and the management can perhaps deal with the situation more effectively and be resilient in whatever economic situations. 2015-11-23 Conference or Workshop Item PeerReviewed application/pdf en http://irep.iium.edu.my/45889/1/45889.pdf Haron, Razali and Mansour Nomran, Naji (2015) Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia. In: Asia-Pacific Conference on Business and Social Sciences 2015 (in partnership with The Journal of Developing Areas, 23rd-24th Nov. 2015, Kuala Lumpur. https://www.aabss.org.au/asia-pacific-conference-business-social-sciences-2015-kuala-lumpur
repository_type Digital Repository
institution_category Local University
institution International Islamic University Malaysia
building IIUM Repository
collection Online Access
language English
topic HG4001 Financial management. Business finance. Corporation finance.
spellingShingle HG4001 Financial management. Business finance. Corporation finance.
Haron, Razali
Mansour Nomran, Naji
Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia
description The study aims to investigate the determinants of working capital management (WCM) on a sample of 57 Malaysian firms in three different scenarios of 2008 global financial crisis, before (2002-2006), during (2007-2008) and after the global financial crisis (2009-2012). Six explanatory variables commonly cited were employed to identify variations in cash conversion cycle (CCC) which acts as the measurement for WCM in this study. These variables are profitability, debt, sales growth, free cash flow, firm size and liquidity. By employing pooled OLS and random effect model, it was found that four out of the six explanatory variables have significant relationships with WCM before the crisis. These factors are profitability, debt; sales growth and firm size. It is interesting to note that the same variables have significant relationships with WCM as well after the crisis of 2008. Thus, firms should take note that when dealing with WCM during non-crisis periods, they should give particular attention to profitability, debt; sales growth and firm size. In contrast, it was found that profitability, firm size and free cash flow are significantly affecting WCM during the financial crisis of 2008. With this extra information on the contributing factors to effective WCM of a firm during these three important periods, this study has filled the gap in the body of knowledge and the management can perhaps deal with the situation more effectively and be resilient in whatever economic situations.
format Conference or Workshop Item
author Haron, Razali
Mansour Nomran, Naji
author_facet Haron, Razali
Mansour Nomran, Naji
author_sort Haron, Razali
title Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia
title_short Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia
title_full Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia
title_fullStr Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia
title_full_unstemmed Determinants of working capital management before, during and after the global financial crisis of 2008: evidence from Malaysia
title_sort determinants of working capital management before, during and after the global financial crisis of 2008: evidence from malaysia
publishDate 2015
url http://irep.iium.edu.my/45889/
http://irep.iium.edu.my/45889/
http://irep.iium.edu.my/45889/1/45889.pdf
first_indexed 2023-09-18T21:05:19Z
last_indexed 2023-09-18T21:05:19Z
_version_ 1777410893896744960

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