TY - JOUR

T1 - Liquidity, cash conversion cycle and financial performance: case of Russian companies

AU - Garanina, T.

AU - Petrova, O.

PY - 2015

Y1 - 2015

N2 - Managing liquidity and the cash conversion cycle play an important role in running a business successfully. Company officials must be confident that their organization does not suffer a shortage or a surplus of payment means and they must be ready to cover current liabilities when necessary. At the same time, the management’s aim is an increase in the company’s returns. The research covers the influence of the current liquidity ratio and cash conversion cycle on financial performance (as a return on net operating assets, RNOA) of Russian companies. A regression analysis of 720 Russian companies engaged in various economic activities for the period 2001 to 2012 was performed with Stata 12.0. The companies in the sample represent the following industries: telecommunications, transport, electric power industry, trade, metallurgy, mechanical engineering, chemical and petrochemical, oil and gas. The authors find an inverse relation between the Russian companies’ cash conversion cycle and RNOA. Further research rev

AB - Managing liquidity and the cash conversion cycle play an important role in running a business successfully. Company officials must be confident that their organization does not suffer a shortage or a surplus of payment means and they must be ready to cover current liabilities when necessary. At the same time, the management’s aim is an increase in the company’s returns. The research covers the influence of the current liquidity ratio and cash conversion cycle on financial performance (as a return on net operating assets, RNOA) of Russian companies. A regression analysis of 720 Russian companies engaged in various economic activities for the period 2001 to 2012 was performed with Stata 12.0. The companies in the sample represent the following industries: telecommunications, transport, electric power industry, trade, metallurgy, mechanical engineering, chemical and petrochemical, oil and gas. The authors find an inverse relation between the Russian companies’ cash conversion cycle and RNOA. Further research rev

KW - liquidity

KW - current liquidity ratio

KW - cash conversion cycle

KW - financial performance

KW - Russian companies

M3 - Article

VL - 12

SP - 90

EP - 100

JO - Investment Management and Financial Innovations

JF - Investment Management and Financial Innovations

SN - 1810-4967

IS - 1

ER -