Impact of Transparency and Disclosure on Financial Distress: Considering Inventory as Moderator

Abstract

The firm's financial distress is an unwanted situation that needs to be overcome timely, otherwise, it leads to business failure. This study examines the influence of transparency and disclosure (TD) on financial distress (FD) using inventory as a moderator. This study used secondary data from CMIE Prowess database for the five years from 2016 to 2020 of BSE100 listed firms. This study has used the panel data analysis (PDA) method for data analysis. The result of this study states that transparency and disclosure (TD) have a negative significance on financial distress under the influence of inventory in health firms in India. The findings provide key implications for managers, and policymakers to entertain the inventory and T &D on a serious node to improve the firm's FD in the health industry. Investors should also consider inventory and T &D as important segments for the firm's FD to have informed decisions. This study contributes substantially to the existing literature to provide insights on T &D, inventory, and firm FD. There exists no such study, hence it provides novel evidence on the association of T&D with firm's FD of Indian health firms considering inventory as moderator.