Determining the moderating role of financial constraints and growth opportunities in the impact of excess cash on company value

baharvand, ardeshir; dastgir, mohsen; soroushyar, afsaneh

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year 14, Issue 54 (2022)

fa 2022, 14(54): 85-100

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Determining the moderating role of financial constraints and growth opportunities in the impact of excess cash on company value

Ardeshir Baharvand¹

, Mohsen Dastgir ^*

¹, Afsaneh Soroushyar¹

1- Department of Accounting, Isfahan (Khorasgan) Branch, Islamic Azad University, Isfahan, Iran.

Abstract: (2911 Views)

The main purpuse of the Firm is to maximize the shareholders' equity. To achieve this purpuse, management seeks to increase the value of the stock market and consequently increase the value of the firm. Holding excess cash by Firms leads to the formation of agency conflicts between managers and shareholders, which increases the authority of the manager and harms the interests of shareholders. Cash is an important and vital resource in any for-profit unit; a company that does not have enough cash may go bankrupt. In this regard, the purpose of this study is to investigate the effect of excess cash on the value of the company, due to financial constraints and growth opportunities on this relationship, among companies listed on the Tehran Stock Exchange in a period of 10 years between 2010 to 2019. . The statistical population of this study was the companies listed on the Tehran Stock Exchange that 147 companies were selected for the test using the systematic elimination method. To test the hypotheses, multiple regression and pooling data were used. Findings showed that excess cash did not have a significant effect on the firms value. Other research findings showed that financial constraints and growth opportunities did not affect the relationship between excess cash and firm value.

Article number: 6

Keywords: Excess Cash, Firm Value, Financial Constraints, Growth Opportunities

Full-Text [PDF 642 kb] (113 Downloads)

Type of Study: Research | Subject: Special

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baharvand A, dastgir M, soroushyar A. Determining the moderating role of financial constraints and growth opportunities in the impact of excess cash on company value. fa 2022; 14 (54) : 6
URL: http://qfaj.mobarakeh.iau.ir/article-1-2598-en.html

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