Corporate cash holding and the value of cash
Date Issued
2015
Date
2015
Author(s)
Chang, Hsuan-Tzu
Abstract
During 2003 to 2013, public firms in Taiwan double their cash holding. This study is purposed to find out why public firms in Taiwan increase their cash holding and whether this increase benefit to their firm value. This research usesthe path analysis to capture the relationship between cash volatility, firm size, net working capital and cash holding. Meanwhile, this study specifies whether corporate will increase current cash holding for their future R&D expense increase, capex increase and investment increase, and how these increase benefit to the future firm value. The result indicates corporate with high cash flow volatility will increase their cash holding. And firms with more asset and net working capital hold less cash. Corporate do increase their cash holding for the future capex increase while none of cash holding increase for R&D expense, capex increase, investment increase will influence the firm value.
Subjects
Cash Holding
Firm Value
Cash Flow Volatility
Transaction Purpose
Precautionary Purpose
Type
thesis