An Empirical Study on Factors Affecting the Usage of Currency Derivatives with Reference to India

2015 ◽  
Vol 3 (2) ◽  
Author(s):  
Ankita Srivastava
Keyword(s):  
Empirical Study ◽  
Financial Constraints ◽  
Foreign Currency ◽  
Driving Forces ◽  
Debt Ratio ◽  
Growth Opportunities ◽  
Factors Affecting ◽  
Export Ratio ◽  
Currency Derivatives

The present paper examines the use of currency derivatives in order to understand the driving forces behind its usage. The analysis carried on 83 non-banking Indian firms revealed that firms with greater growth opportunities and less financial constraints are more likely to use currency derivatives. This result suggests that firms might use derivatives to reduce cash flow variation that might otherwise preclude firms from investing in valuable growth opportunities. The overall analysis reveals that debt ratios i.e. foreign currency borrowing and long term debt ratio along with the income ratios like export ratio and profit before tax are the important micro-economic variables for using currency derivatives.

Assessing the Factors Affecting the Implementation of E-Government and Effect on Performance of DVLA

2019 ◽  
Vol 15 (1) ◽  
pp. 47-61
Author(s):  
Gerald Dapaah Gyamfi ◽  
George Gyan ◽  
Mavis Ayebea ◽  
Florence Naa Norley Nortey ◽  
Prince Yaw Baidoo
Keyword(s):  
Developing Countries ◽  
Financial Constraints ◽  
Sampling Technique ◽  
Developed Countries ◽  
Electronic Government ◽  
Electricity Supply ◽  
Successful Implementation ◽  
Factors Affecting ◽  
Ict Infrastructure

Though many researchers have carried out studies on electronic government (e-government) and its effect on performance of public organizations in developed countries not much such studies have taken place in developing countries, creating a gap in literature. The current study seeks to fill the gap. The study highlights the factors affecting the implementation and sustainability of E-government and effect of the factors on performance of the driver and vehicle licensing agency (DVLA) in Ghana. The study used purposive sampling technique to gather data from the DVLA (N-50) in 2016. The outcome of the study revealed that the challenges that impede the successful implementation of e-government include regular interruption of the electricity supply, online theft, poor ICT infrastructure, and financial constraints. Based on the benefits associated with the implementation of e-government, the current researchers made recommendations for long-term sustainability of e-government.

“Understanding restaurant firms” debt-equity financing

2017 ◽  
Vol 29 (12) ◽  
pp. 3006-3022 ◽  
Author(s):  
Sung Gyun Mun ◽  
SooCheong (Shawn) Jang
Keyword(s):  
Fixed Effects ◽  
Financial Constraints ◽  
Debt Financing ◽  
Debt Ratio ◽  
Financial Leverage ◽  
Equity Financing ◽  
Important Indicator ◽  
Content Type ◽  
Restaurant Firms

Purpose The purpose of this study was to extend the understanding of restaurant firms’ overall debt and equity financing practices by considering what drives equity financing. More importantly, this study attempted to identify whether an optimal financial leverage point exists in the relationship between debt financing and equity financing for restaurant firms. Design/methodology/approach This study used fixed-effects regression models with a sample of 1,549 unbalanced firm-year panel data to identify restaurant firms’ financial practices and the impacts of financial constraints. Findings First, restaurant firms tend to issue long-term debt to pay back existing debt. However, the amount of debt does not exactly match the debt’s maturity. Second, small restaurant firms’ net debt financing, as well as net equity financing, has an inverted-U-shaped relationship with financial leverage. Finally, the effect of financial leverage on external financing significantly differs between small and large restaurant firms. Practical implications Restaurant firms routinely use both debt and equity financing interchangeably to manage their financial constraints and target debt ratio. Further, firm size is an important indicator of financial constraints, while equity financing plays an important role in managing an optimal target debt ratio. Originality/value This study is unique in that it considers determinants of restaurant firms’ long-term debt financing as well as equity financing. This study also examines differences in long-term debt and equity financing practices between financially constrained and unconstrained firms.

The Impact of Firm Specific Factors on Capital Structure

2014 ◽  
Vol 1 (2) ◽  
pp. 1-21
Author(s):  
Mehtap Öner
Keyword(s):  
Capital Structure ◽  
Positive Impact ◽  
Total Asset ◽  
Debt Ratio ◽  
Growth Opportunities ◽  
Industrial Enterprises ◽  
Total Debt ◽  
Specific Factors ◽  
The Impact

The main aim of this study is to analyze the impact of firm specific factors on corporate capital structure decisions of firms. The analysis is based on the year end observations of 100 firms which are among the top 1000 industrial enterprises listed on Borsa Istanbul for the period 2005-2011. By using panel data methodology, five explanatory variables: tangibility, profitability, firm size, non-debt tax shields and growth opportunities are evaluated as the firm specific determinants of capital structure decisions. The leverage ratio which is the dependent variable of the analysis is used as the proxy of firms' capital structure. In order to test whether crucial results are robust to alternative leverage definitions, this study measures leverage as the firm's total debt to total asset and long term debt to total asset ratios by focusing both on book and market based measures. The major findings of the study with respect to financing decisions of firms provide significant and positive impact of tangibility on long term debt ratio, however it turns out to be inverse for total debt ratio. In addition, it is found that profitable firms tend to have lower leverage; and larger companies tend to have higher debt ratios compared to small ones. What is more, evidence support that firms with greater growth opportunities and non-debt tax shield reveal inverse relation with debt level. Except the impact of growth opportunities which is only significant for market based leverage ratios, the findings for all other variables are robust for different definitions of leverage.

Pengaruh Financial Leverage terhadap Financial Performance pada Sektor Industri Manufaktur yang Terdaftar di Bursa Efek Indonesia (BEI) Periode 2015

2018 ◽  
Vol 9 (2) ◽  
pp. 33-48
Author(s):  
Rivaldy Februansyah ◽  
Ika Yanuarti
Keyword(s):  
Financial Performance ◽  
Manufacturing Sector ◽  
Linear Regression Analysis ◽  
The Other ◽  
Debt Ratio ◽  
Financial Leverage ◽  
Coverage Ratio ◽  
Equity Ratio ◽  
Internal Fund

The manufacturing sector is one of the most dominant economic sectors in in achieving growth and development in Indonesia. It needs adequate fund to develop its business. The sources of fund are from internal and external. The firm usually optimized the usage of internal fund prior to external fund. The internal fund comes from equity while the external funds are from debt and stock. Debt is also known as financial leverage. There is a phenomenon that the usage of debt increased the firm’s financial performance, since interest on debt could lower the payment of tax (tax shield). On the other side, the higher the financial leverage the higher the risk of bankruptcy. This research aims to analyze whether financial leverage has an influence on financial performance in the manufacturing sector listed on the Indonesia Stock Exchange (IDX) period 2015. The method of analysis used in this research is multiple linear regression analysis. This research uses quantitative approach with a sample of 140 listed companies in the manufacturing industry. The firm’s financial performance could be measured by the financial ratios. Financial Leverage ratios are ratios that measure the ability of firm’s to meet its financial obligation and the level of usage debt as compared to equity. There are several financial leverage ratios that used in this research, such as Debt Ratio (DR), Debt to Equity Ratio (DER), Interest Coverage Ratio (ICR), and Long Term Debt Ratio (LTDR). Financial performance indicates the ability of firm to generate profit and measured by Profitability Ratio. Return on Asset (ROA) is one of the Profitability Ratio. The statistical result shows that Debt Ratio (DR) negatively affect Return on Asset (ROA) and Interest Coverage Ratio (ICR) positively affect Return on Asset (ROA). Meanwhile, Debt to Equity Ratio (DER) and Long Term Debt Ratio (LTDR) did not affect Return on Asset (ROA). On the other hand, result shows that Debt Ratio (DR), Debt to Equity Ratio (DER), Interest Coverage Ratio (ICR), and Long Term Debt Ratio (LTDR) affect Return on Asset (ROA) simultaneously. Keywords: Financial Leverage, Debt Ratio (DR), Debt to Equity Ratio (DER), Interest Coverage Ratio (ICR), Long Term Debt Ratio (LTDR), Financial Performance, Return on Assets (ROA)

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