Operating Cash Flow Research Articles

Detection of Cash Flow Shenanigans in The Financial Reports of PT Waskita Karya Tbk

To better understand if fraud occurs in the financial reports generated by PT Waskita Karya Tbk in 2020–2022, the research problem is linked to the Cash Flow Shenanigans hypothesis. Positive and negative aspects of the contemporary, still-evolving age exist, such as an increase in dishonesty or fraud. Intentional deception has the dual goals of deceiving others and enhancing one's personal benefit. Financial statements that are false, especially those that mention cash flow, are one of the most typical forms of fraud. The information reviewed in this article suggests that PT Waskita Karya Tbk may be using the company's cash flow to conduct fraud or perpetrate it again. Using the company's cash flow ratio and keywords from the available references, this research approach combines qualitative and quantitative analysis. According to reports, the company transferred monies intended for financing activities to operational funds in the first cash flow scam. Reviewing the study's findings revealed that the company had stolen money. The fourth Cash Flow Shenanigan is an increase in operational cash flow caused by unsustainable operations. Finding out if PT Waskita Karya Tbk has ever engaged in fraud is vital since fraud may hurt all parties, especially investors.

Financial Metrics and Property Stock Returns: Evidence from Indonesia

This quantitative study examines the influence of Market Value Added, Economic Value Added, Earnings Per Share, and Operating Cash Flow on property stock returns in the Indonesian stock exchange. The research focuses on a sample of 27 property companies for the period 2017-2020, selected from a population of 54 companies. Multiple regression analysis using Eviews version 9 is employed as the analytical method. The findings indicate that Market Value Added, Economic Value Added, and Earnings Per Share do not significantly affect stock returns. However, Operating Cash Flow demonstrates a significant impact on stock returns. Additionally, when considered together, Market Value Added, Economic Value Added, Earnings Per Share, and Operating Cash Flow collectively exhibit a significant influence on property stock returns. This study provides valuable insights for investors, analysts, and policymakers in understanding the determinants of stock returns in the property sector, offering implications for decision-making and investment strategies in the Indonesian stock market.
 Highlights:
 
 Financial metrics: Investigating the impact of Market Value Added, Economic Value Added, Earnings Per Share, and Operating Cash Flow on property stock returns.
 Stock return determinants: Analyzing the significance of these financial metrics in influencing the returns of property stocks.
 Market implications: Providing insights for investors and policymakers regarding the role of financial metrics in predicting and understanding property stock returns.
 
 Keywords: Market Value Added, Economic Value Added, Earnings Per Share, Operating Cash Flow, property stock returns

Cash Flow, Firm Size, and Earnings Persistence: Debt as Moderator

This quantitative study aims to examine the impact of operating cash flow on earnings persistence, considering debt level as a moderating variable. Additionally, the study investigates the influence of firm size on earnings persistence, also with debt level as a moderating variable. The research employs Moderated Regression Analysis (MRA) using SPSS software. Classical assumption tests, including normality, multicollinearity, autocorrelation, and heteroscedasticity tests, are conducted prior to MRA. The findings align with previous research, indicating that debt level does not moderate the relationship between firm size and firm value. These results contribute to the understanding of the dynamics between operating cash flow, firm size, earnings persistence, and debt level, providing insights for financial decision-makers in managing and interpreting financial performance indicators.
 Highlights:
 
 This quantitative study examines the influence of operating cash flow on earnings persistence, with debt level as a moderating variable.
 It also investigates the impact of firm size on earnings persistence, with debt level as a moderating variable.
 The research utilizes Moderated Regression Analysis (MRA) and conducts classical assumption tests to validate the findings. The results reveal that debt level does not moderate the relationship between firm size and firm value, contributing to the understanding of financial dynamics in organizations.
 
 Keywords: Operating cash flow, Earnings persistence, Debt level, Firm size, Moderating variable.

How microeconomic factors influence Vietnam’s listed manufacturing firm value

It is meaningful to identify and quantify the impact of business microeconomic factors on firm value, not only for enterprises, but also for the industry, which contributes to the economic growth of the whole country. This paper aims to find evidence of how microeconomic factors relate to the value of manufacturing firms, helping businesses behave and adjust towards the goal of value maximization. This study applies three commonly used estimators with panel data, namely OLS, FEM and REM, using data obtained from FiinPro (a data providing company) and Vietstock on 691 companies listed on Vietnam’s two stock exchanges from 2008 to 2015; This was a sensitive period of world financial crisis, and Vietnamese manufacturing firms had a really hard time to overcome the difficulty in a global economy downturn. This paper found that (1) firm size, growth opportunities and financial leverage negatively affect firm value; (2) there is no evidence that operating cash flow, cash liquidity and intellectual capital affect firm value; (3) the estimation results confirm the non-linear relationship (order 3) between the directors’ share ownership ratio and corporate value; (4) state ownership and foreign ownership ratios have a negative effect on Vietnamese listed manufacturing firms during the period, but (5) there is no optimal number of BOD members. The findings help to measure the extent of the positive and negative impact of various factors, making it easier to find solutions to improve business value by promoting positive factors and preventing negative factors.

THE IMPACT OF FINANCIAL RATIOS ON THE VALUE OF COMPANIES THAT CONDUCTED M&A WHICH REGISTERED IN IDX ON 2016-2021

This study aims to analyze the impact of the financial ratios such liquidity, solvability, turnover, profitability, and market value, economic value added and operating cash flow on the market value added of corporate mergers and acquisitions that listed in IDX from 2016 to 2021. The research informs influence of independent variables to MVA in companies that do M&A as their business strategy. The sampling technique in this study used non-probability sampling with purposive sampling method. Obtained samples of 19 public companies listed on the IDX and secondary data taken from the Indonesian Stock Exchange website. Financial performance measurement takes place five years before and after M&A. The analytical method uses panel data regression and from panel regression we found that EVA, CR, and ROE are significantly positive influenced with market value added of listed firms in Indonesia that conducted M&A. Our results indicate that earning per share significantly has negative influence to MVA; while DER and TATO are insignificantly negative influenced and OCF is insignificantly positive influenced with market value added.

Analisis Faktor-Faktor Yang Mempengaruhi Financial Distress

Financial distress is a condition of decline in the company's performance and finances that can have an impact on the company's bankruptcy. Financial distress needs to be overcome early so that the company avoids bankruptcy. Therefore, it is necessary to analyze financial distress to anticipate bankruptcy. The study was conducted with the aim of examining the effect of operating cash flow, leverage, operating capacity, and company size on financial distress. The type of research conducted is quantitative research with purposive sampling methods. The data used is secondary data with financial statements from real estate and property sub-sector companies for the 2019-2021 period listed on the Indonesia Stock Exchange (IDX). Companies that became a sample of 61 companies in 3 periods with a total sample of 183 samples. The method used in the study was multiple linear regression analysis using the SPSS program version 25. The results showed that operating cash flow and leverage affect financial distress. Variables that do not affect financial distress in this study are operating capacity and company size.

Pengaruh Earnings Per Share, Arus Kas Operasi, Ukuran Perusahaan Terhadap Harga Saham

The purposes of this study are (1) to determine the effect of earnings per share, operating cash flow and company size together on stock prices, (2) to determine the effect of earnings per share on stock prices, (3) to determine the effect of cash flows operations on stock prices, (4) To determine the effect of company size on stock prices. This research is research that uses a quantitative approach. Furthermore, this research is a type of associative research. The data collection technique is a purposive sampling method. Methods of data analysis in this study are descriptive statistical tests, research model tests, classical assumption tests, regression tests and hypothesis testing. The results in this study are as follows: (1) there is an effect of earnings per share, operating cash flow, and company size together on stock prices (2) there is an effect of earning per share on stock prices, (3) there is an effect of operating cash flow on stock prices, (4) there is an effect of company size on stock prices.

Revisiting the Impact of NPAs on Profitability, Liquidity and Solvency: Indian Banking System

In the light of the fact that non-performing assets (NPAs) in the country are increasing at a very fast pace, this article intends to investigate the outcome of gross NPAs (GNAPs) ratio on profitability, liquidity and solvency in Indian banking system. To study this impact, we have used panel data of 30 Indian banks (12 government sector banks and 18 private sector banks) from 2014 to 2021 (8 years) collected from Prowess (CMIE) and money control. The current study uses four different panel regression models, that is, fixed and panel regression models, pooled regression models and seemingly unrelated regression models. The empirical outcomes of the current study confirm the outcomes of existing studies. The findings of this article confirm the substantial association between the GNPA ratio and profitability ratio, that is, net profit ratio, return on assets ratio and return on equity ratio. Further, the study also confirms the association between the GNPA ratio and liquidity ratios of banks (cash flow margin, current ratio, acid test ratio, cash ratio and operating cash flow ratio). We also found the impact of the GNPA ratio on the capital adequacy ratio.

Rasio Keuangan, Laba Akuntansi dan Arus Kas Operasi dalam Pengaruhnya terhadap Return Saham

The purpose of this study was to examine the effect of financial ratios, accounting profit and operating cash flow on stock returns. This study uses a population of food and beverage sub-sector companies listed on the Indonesia Stock Exchange for the 2018-2022 period. Purposive sampling method was used and 11 companies were found as samples. The results showed that return on assets (ROA), current ratios, and accounting profit have an effect on stock returns. In accordance with the signal theory, that the existence of information regarding ROA, current ratio and accounting profit becomes a significant signal to investors so that there is an influence on stock returns. However, the different effects on the variable debt to equity ratio and operating cash flow have an insignificant effect, so that it can be interpreted that these two pieces of information are not used as meaningful information for investors so that there is no reaction.

FAKTOR-FAKTOR PENENTU PENILAIAN KEMBALI ASET TETAP UNTUK MENINGKATKAN ARUS KAS DAN POSISI PASAR

This study discusses the implementation of fixed asset revaluation by taking case studies on manufacturing companies listed on the IDX in 2019-2021. Fixed asset revaluation is an action that may be required to describe the actual value of a company's assets accurately. This study aimed to determine the significance of leverage, decrease in operating cash flow, market book ratio, firm size, and intensity of fixed assets on revalued fixed assets. Statistical methods used in this study are descriptive statistics, overall fit model, fit test, Nagel Kerke (R-Square) , and logistic regression. Samples were taken using a purposive sampling technique. The final sample is 193 manufacturing companies listed on IDX in 2019-2021. The results of this study indicated that company size and market book ratios significantly affect fixed asset revaluation. Leverage decreased operating cash flow and fixed asset intensity had no significant effect on the revaluation of fixed assets. Keywords : Cash flow, Company size, Fixed asset intensity , Fixed asset revaluation, Leverage, Market book ratio

Pengaruh Pengungkapan Corporate Social Resposibility terhadap Manajemen Laba:


 The purpose of this study was to examine the effect of Corporate Social Resposibility disclosure on earnings management with the proxies Cash Flow of Operation (CFO), Production Cost (PROD), and Discretionary Expense (DISR) in manufacturing companies listed on the IDX in the 2017–2021 period. The type of research used in this study is quantitative. The number of samples in this study was 10 companies, so the total sample was 50, which were selected using the purposive sampling method. The results showed that the disclosure of Corporate Social Resposibility had no effect on earnings management with the proxies Cash Flow of Operation (CFO) and Discretionary Expense (DISR), while the disclosure of Corporate Social Resposibility had an effect on production cost (PROD).
 Keywords: Corporate Social Resposibility, Cash Flow of Operation, Production Cost, Discretionary Expense

Analysis of Sound Corporate Governance Effect on Company's Financial Fundamentals toward Stock Returns

This research is proxied by Current Ratio to determine the company's ability to meet its short-term obligations through Return Shares, and Corporate Governance is expected to function as a tool to provide confidence to investors. There fore this study aims to examine and analyze the effect of Liquidity, Profitability, Solvency, Accounting Profit, and Operating Cash Flow on Return Share with Corporate Governance. To answer the above objectives, quantitative analysis is needed, with data collection methods collected through literature studies originating from books, journals, theses, the internet and documentation. Testing the hypothesis used in this study is multiple regression analysis and moderation regression analysis. The population of this study are mining sector companies listed on the Indonesia Stock Exchange. The number of companies that are the sample is 32 companies. This research uses the method purposive sampling, so that the total sample is 160 samples. The results of the study show that Profitability, Accounting Profit, and Operating Cash Flow have an effect on Return Share. While Liquidity and Solvability have no effect on Return Shares.

AirTouch Communications’ Innovative Disclosure: “Proportionate Financial Data”

ABSTRACT This note relates and discusses the financial reporting innovation in the 1990s by AirTouch Communications, Inc., a wireless telephone service provider. The innovation was intended to show the parent company’s proportionate ownership share of its subsidiaries’ and joint ventures’ operations, restating key figures from the income statement and operating cash flow. The author corresponded with AirTouch’s then chief financial officer (CFO) for an explanation of the reasoning behind the innovation. Another issue that this note addresses is the opinion given by the audit firm on supplemental disclosures that depart from GAAP.

Pengaruh Operating Capacity, Sales Growth, dan Arus Kas Operasi Terhadap Financial Distress

This study aims to examine the effect of Operating Capacity, Sales Growth, and Operating Cash Flow on Financial Distress in Service Companies in the Infrastructure, Utilities, and Transportation sectors listed on IDX period 2018-2020. The technique used in this study is purposive sampling which produced 40 samples companies in a period of 3 years. The analytical method used is multiple linier regression. The result of this study indicate that Operating Capacity and Operating Cash Flow affect Financial Distress, Sales Growth has no effect in Financial Distress. Implications for manager can realize facing financial distress like operating capacity, sales growth and operating cash flow and focus to maintain operating cash flow generating enough to drive the operating capacity needs of the business. There is also a clear implication for managers of firms as paying most of one attention to one aspect of financial performance appears to increase financial distress like operating capacity, sales growth and operating cash flows and managing operating cash flow according to the company’s capabilities. Investors and creditors also need to consider fundamental aspects such as the company’s financial ratios providing a better understanding of the performance of the the firmas operating capacity, sales growth, and operating cash flows to prediction of financial distress. Keywords: financial distress, operating capacity, cash flow, sales growth, IDX

Impact of earnings components on future profitability of banking and insurance companies in Jordan

This study aimed to examine the impact of a firm’s total accruals and operating cash flows on future profitability (one-year-ahead ROA) using a static model on unbalanced panel data for all the (15) banks and (18) insurance companies listed on the Amman Stock Exchange from 2002 to 2019. The final sample of the study, for analysis, consisted of 280 observations taken from the banking sector and 410 observations from the insurance sector. The pooled sample of banks’ observations showed no significant impact of a firm’s total accruals and operating cash flows on one-year-ahead ROA. This result is consistent with previous studies’ results, which are still under debate, especially in developed countries. The investors of the Jordanian banks are not counting on the accrual earnings components, which are affected by the different estimation procedures of GAAP and managerial discretion. The pooled sample of the insurance companies’ observations showed a significant impact of a firm’s total accruals and operating cash flows on one-year-ahead ROA. The result showed a higher variable value of a firm’s operating cash flow than the firm’s total accruals for the pooled sample of insurance companies. This result indicates a more incrementally negative relation between the growth in operating assets and a one-year-ahead ROA in addition to the probable impact of the lower rate of economic profits and the conservative bias in accounting.

The Effect of Business Strategy, Managerial Ability, Multiple Large Shareholders, and Earnings Management on Investment Efficiency

Companies often withhold or reject projects that generate net present value. As a result, investment decisions are not optimal and lead to lower investment efficiency. This study examines the effect of business strategy, managerial ability, multiple large shareholders, and earnings management on investment efficiency. The sample was selected from companies listed on the Indonesia Stock Exchange for 2019-2021. Financial and insurance industry companies were excluded because they have different accrual characteristics. Several control variables are added to the regression model. The results show that business strategy is associated with investment efficiency. In contrast, managerial ability, multiple large shareholders, and earnings management have no effects on investment efficiency. As for control variables, operating cash flow, debt-to-equity ratio, firm size, and return on assets are associated with investment efficiency.

Rent Seeking, Earning Management and Agency Cost: How Do They Impact Equity Value? Indian Evidence

The article examines the earning management and its nature of the non-rent seeking (NRS) and rent seeking prone (RSP) firms of India followed by their respective valuation implication in the light of agency cost. The various earning management components are estimated from the residuals of a series of regression models, and then compared based on categorization of NRS and rent seeking nature of firms. The robustness of the estimates is validated using various financial characteristics and a separate cross-sectional estimation model. Finally, the article uses ordinary least square (OLS) and 2 stage least square (2 SLS) regression models to find the impact of different earning management components on valuation of NRS and rent seeking firms in the backdrop of their differential agency cost. The results of the study suggest that the cash flow management by the NRS firms with lesser agency cost, is beneficial for equity valuation as the same might convey private information as to future operating cash flow, but accrual management by them impacts valuation negatively—due to information risk. For RSP firms with higher agency cost—cash flow management and cost of production management being opportunistic, inversely impact the equity value. The study provides insight as to how valuation gets impacted by different forms of earning management in presence of differential agency cost of non-rent and rent seekers in an economy where ‘cronyism’ plays a dominant role.

AN EMPIRICAL STUDY OF THE FACTORS THAT INFLUENCE FINANCIAL DISTRESS (A CASE ON MINING INDUSTRY IN INDONESIA)

The purpose of this research is to empirically prove the role of profitability, financial leverage, and operating cash flow in predicting financial distress which can be useful for stakeholders and researchers in the future (creditors, government, and investors). This research uses quantitative research method and the data is taken from the issuer's financial statements on IDX by purposive sampling method. Multiple linear regression is used to analyze data in this research. The population used is mining industries listed on the Indonesia Stock Exchange for 7 years of observation, from 2014-2020. There are as many as 55 samples obtained in this research which are then analyzed using software Microsoft Excel and SPSS 26.0. This study shows that the profitability and operating cash flow variable have a positive effect on financial distress; variable financial leverage does not effect financial distress. Debt is a factor that can cause financial distress, so that the leverage ratio setting and debt policy must be a concern for the company, especially for mining companies that require working capital and investment in their operations.

Liquidity Ratio Analysis in Financing Short Term Liabilities

The objective of this research study is to know whether X Consultancy Services company can cover up their short term liabilities or not and if they can, how good they can cover up their short term liabilities. In doing the research, the writer obtains the data from X Consultancy Services. The writer analyzes the data using descriptive method. Based on data collected, the writer calculated the liquidity ratio to know whether this company can cover up their short term liabilities or not. The writer calculated the liquidity ratio using three methods which is quick ratio, current ratio, and operating cash flow ratio from 2018 until 2020 in other to know can this company cover up their short term liabilities and how good they cover their short term liabilities. Based on data analysis, we know that company current assets is grow faster than their current liabilities while their current liabilities grow faster than their cash flow from operating. This thing makes the quick ratio and current ratio increased while operating cash flow ratio is decreased. Based on data presentation and analysis, the writer can conclude that the company can cover up their short term liabilities and they are consider good at covering their short term liabilities. But their must more focus on their cash flow from operating because if we look from operating cash flow ratio, it decreasing year by year and it will be not good for the company.

Working Capital Management Function of Cash Flow Based Corporate Finance (CFCF) Model

Purpose: The purpose of this article is to explain one of the six functions of “Cash Flow Based Corporation (CFCF) Model. Look at. Yilmaz(2022) and Yilmaz (2023).
 Methodology: 14 cash flow ratios were selected from the 30 ratios CFCF Model covers for explaining this subject . They are Cash Flow Adequacy I, Cash Flow Adequacy II, CFFO to Annual Interest Payments, Overall Cash Flow, Interest Payment Coverage, Fixed Charges Coverage, Cash Interest Coverage, CFFO to Assets, Current Maturities of LTD Coverage, Operating Cash Flow, Cash Current Debt Coverage, Return of Sales to CFFO, Operating Index, and Return of Sales to Cash.Then, they were explained by this writer to explain the subject. At the Chapter 4, an application on the Apple Financial Statements (Balance Sheets, Income Statements, and Cash Flow Statements) covering the years 2017-2022 was fulfilled..
 Findings: Working capital management function of CFCF model could be fulfilled by using selected 14 cash flow ratios for this purpose and it could be applied in corporations like I applied in the Apple.