Investigating Factors Affecting Capital Structure of Equitized State-Owned Enterprises in Ho Chi Minh City

Using panel data along with the application of Pooled OLS, FEM, and REM estimates, this study conducts an investigation into the effects of a series of factors, namely state ownership, size, tangible assets, growth, return on assets (ROA), effective tax rate, and liquidity, on capital structure of 165 HCMC-based equitized state-owned enterprises (SOEs), categorized into three groups over the 2008–2012 period. As suggested by the findings, tangible assets, ROA, and liquidity are negatively related to leverage ratio and short-term debt ratio for the three groups of enterprises. In terms of firm size, there exists a positive correlation with leverage ratio and short-term debt ratio for Group 1 and 2 but a negative correlation with short-term debt ratio for the case of Group 3.

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PENGARUH PROFITABILITAS, UKURAN PERUSAHAAN, LEVERAGE, KEPEMILIKAN MANAJERIAL DAN CAPITAL INTENSITY RATIO TERHADAP TAX AVOIDANCE

Jurnal ULTIMA Accounting ◽

10.31937/akuntansi.v12i2.1883 ◽

2020 ◽

Vol 12 (2) ◽

pp. 320-331

Author(s):

Ledya Akmal Syaflet Bandaro ◽

Stefanus Ariyanto

Keyword(s):

Intensity Ratio ◽

Tax Avoidance ◽

Capital Intensity ◽

Managerial Ownership ◽

Manufacturing Companies ◽

Effective Tax Rate ◽

Return On Assets ◽

Leverage Ratio ◽

Tax Rate ◽

Factors Affecting

This research aims to study the factors affecting Effective Tax Rate as a ratio indicates the efficiency of tax burden management by companies. The factors are Return on Assets (ROA), Ukuran Perusahaan (SIZE), Leverage (LEV), Managerial Ownership (KPM) dan Capital Intensity Ratio (CIR). Research sample were taken from the population of public manufacturing companies in Indonesia for the period 2016-2018, selected with predetermined criteria, resulting 55 companies from the population. The data is analysed using linear regression technique. This research reveals that the only variable that has significant influence towards Effective Tax Rate is Return on Assets and all the variables are simultaneously have effect towards Effective Tax Rate. Keywords: Return on Assets, leverage ratio, Firm Size, Managerial Ownership, Capital intensity, tax avoidance, effective tax rate.

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Factors Explaining Debt Firm Policy: A Comparison between Five Intercontinental Countries

Business and Economic Research ◽

10.5296/ber.v7i1.9292 ◽

2017 ◽

Vol 7 (1) ◽

pp. 285

Author(s):

Ben Said Hatem

Keyword(s):

South Africa ◽

Capital Structure ◽

Firm Growth ◽

Debt Ratio ◽

Firm Age ◽

Growth Opportunities ◽

Short Term ◽

Return On Assets ◽

Debt Policy

We test the factors explaining the debt policy of firms across five continents. To this end, we examine samples from South Africa, Australia, Brazil, India and Spain over a period of 8 years from 2003 to 2010. The results manipulate differences in debt policy for all countries (except for the variable Return on Assets, ROA). As for the effect of activity sectors on firm debt policy, higher performance led to lower firm debt ratios. Furthermore, we concluded some differences in other variables. Higher tangibility ratios for firms from South Africa, India and Spain led to higher capital structure ratios. Larger firms from Brazil led to lower short term debt ratio. We could not find evidence on the effect of firm growth opportunities in Brazil and India. Furthermore, we concluded to a positive and a statistically significant effect of liquidity ratio for Australia and India, and a positive and a statistically significant effect of firm age for firms from Spain.

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Determinants of Firm Capital Structure: Empirical Evidence From Vietnam

International Journal of Financial Research ◽

10.5430/ijfr.v11n4p10 ◽

2020 ◽

Vol 11 (4) ◽

pp. 10

Author(s):

Hieu Thanh Nguyen ◽

Anh Huu Nguyen

Keyword(s):

Capital Structure ◽

Method Of Moments ◽

Firm Size ◽

Generalized Method Of Moments ◽

Return On Assets ◽

Return On Equity ◽

Factors Affecting ◽

Tangible Assets ◽

Negative Effect ◽

Positive Effect

The paper aims to investigate the factors affecting firm capital structure in the context of Vietnam. The research sample includes 290 non-financial listed companies on Vietnamese stock market. This study applied Generalized Method of Moments (GMM) to explain the research results. The paper investigates six factors influencing on firm capital structure including return on assets (ROA), return on equity (ROE), firm size, tangible assets, risks, and growth. The empirical results show that return on assets, tangible assets, risks, and growth have a statistically significant positive effect on the firm capital structure while return on equity has a statistically significant negative effect on the firm capital structure. In addition, when dividing companies into sectors, the study realized that determinants of capital structure in some sectors are consistent with results for entire sample. Finally, firm size has the same impact on capital structure in oil & gas companies and material companies whereas it is not statistically significant for other companies. These evidences provide a new insight to managers on how to determine the reasonable capital structure.

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Pengaruh Profitabilitas, Good Corporate Governance dan Intensitas Modal Terhadap Penghindaran Pajak pada Perusahaan Pertambangan Sektor Batu Bara di Bursa Efek Indonesia Periode 2016-2018

Jurnal Ilmiah Mahasiswa Manajemen, Bisnis dan Akuntansi (JIMMBA) ◽

10.32639/jimmba.v2i4.619 ◽

2020 ◽

Vol 2 (4) ◽

pp. 641-654

Author(s):

Eka Murni Lusiana Wati ◽

Susi Astuti

Keyword(s):

Corporate Governance ◽

Capital Intensity ◽

Effective Tax Rate ◽

Return On Assets ◽

Tax Rate ◽

Purposive Sampling ◽

Good Corporate Governance ◽

Corporate Governace

Penelitian ini bertujuan untuk mengetahui pengaruh profitabilitas, good corporate governace, dan intensitas modal terhadap penghindaran pajak yang diproksikan dengan cash effective tax rate (CETR) pada perusahaan pertambangan sektor batu bara yang terdaftar di Bursa Efek Indonesia (BEI). Mekanisme profitabilitas yang digunakan adalah return on asset, good corporate governance yang digunakan adalah proporsi kepemilikan institusional dan dewan komisaris independen, intensitas modal yang digunakan adalah capital intensity. Populasi dalam penelitian ini adalah seluruh perusahaan pertambangan sektor batu bara yang terdaftar Bursa Efek Indonesia (BEI) tahun 2016 sampai 2018. Sedangkan sampel penelitian ini ditentukan dengan metode purposive sampling sehingga diperoleh 45 perusahaan sampel. Jenis data yang digunakan adalah data sekunder yang diperoleh dari www.idx.co.id. Metode analisis yang digunakan adalah analisis regresi berganda. Berdasarkan hasil analisis regresi berganda maka hasil penelitian ini yaitu return on assets, dewan komisaris independen berpengaruh negatif terhadap penghindaran pajak yang diproksikan dengan cash effective tax rate, sedangan kepemilikan institusional, intensitas modal tidak berpengaruh terhadap penghindaran pajak yang diproksikan dengan cash effective tax rate.

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Capital Structure and The Profitability of Listed Retail Firms

Journal of Economics and Behavioral Studies ◽

10.22610/jebs.v10i1(j).2100 ◽

2018 ◽

Vol 10 (1(J)) ◽

pp. 171-181

Author(s):

Jason Stephen Kasozi

Keyword(s):

Capital Structure ◽

Negative Relationship ◽

Order Theory ◽

Debt Financing ◽

Retail Sector ◽

Short Term ◽

Return On Assets ◽

Pecking Order Theory ◽

Policy Interventions

The South African retail sector continues to experience a decline in sales and returns amidst growing external competition and a drop in consumer confidence stemming from the recent credit downgrades in the country. Yet, firms in this sector appear to maintain high debt to equity levels. This study investigated whether the capital structure practices of these firms influence their profitability. A Panel data methodology, using three regression estimators, is applied to a balanced sample of 16 retail firms listed on the Johannesburg Securities Exchange (JSE) during the period 2008-2016. The analysis estimates functions relating capital structure composition with the return on assets (ROA). Results reveal a statistically significant but negative relationship between all measures of debt (short-term, long-term, total debt) with profitability, suggesting a possible inclination towards the pecking order theory of financing behaviour, for listed retail firms. Additionally, retail firms are highly leveraged yet over 75% of this debt is short-term in nature. Policy interventions need to investigate the current restrictions on long-term debt financing which offers longerterm and affordable financing, to boost returns. While this studyâ€™s methodology differs slightly from earlier studies, it incorporates vital aspects from these studies, and simultaneously specifies a possible model fit. This helps to capture unique but salient characteristics like the transitional effects of debt financing on firm profitability. It therefore delivers some unique findings on the financing behaviour of retail firms that both in form policy change, while stimulating further research on the phenomenon.

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Receptiveness of effective tax rate to firm characteristics: an empirical analysis on Indian listed firms

Journal of Asia Business Studies ◽

10.1108/jabs-11-2018-0304 ◽

2020 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Ajaya Kumar Panda ◽

Swagatika Nanda

Keyword(s):

Regression Model ◽

Firm Size ◽

Manufacturing Firms ◽

Debt Ratio ◽

Effective Tax Rate ◽

Content Type ◽

Tax Rate ◽

Tax Shield ◽

Dynamic Panel Regression ◽

Debt Tax Shield

Purpose The purpose of this paper is to empirically investigate the factors deriving effective tax rate (ETR) for Indian manufacturing firms in different sectors. The study also tries to analyze the sensitiveness of ETR because of shocks on its key determinants. Design/methodology/approach The study is using Arellano–Bond dynamic panel regression model to identify the key drivers of ETR, and impulse response functions of panel vector auto-regression model to analyze the response of ETR because of one standard deviation (SD) shock to its key determinants. Findings This study concludes that ETR is significantly explained by firm size, profitability, growth rate and non-debt tax shield in most of the sectors, and debt ratio, asset tangibility and age of the firms are impacting ETR differently across sectors. In case of entire manufacturing sector, firm size, profitability, growth and non-debt tax shield are driving ETR positively and asset tangibility is driving ETR negatively. Interest coverage ratio (ICR) and firm age are not significant drivers of ETR. ETR is positively related with firm size, but responses negatively when there is an immediate shock to firm size. Similarly, ETR is negatively related with asset tangibility, but responds positively following an immediate shock to it. Overall, ETR is more sensitive and responses significantly because of shocks in firm size, profitability, growth, asset tangibility and non-debt tax shield whereas, the response is very marginal following shocks to debt ratio, ICR and age of the firm. Research limitations/implications Firm managers may find the study useful to understand the receptiveness of ETRs at each sector level. The empirical findings are not only validating the theoretical developments but also providing a root cause analysis to the firm managers to understand the cause and consequence of ETRs for firms at different sectors. Originality/value Empirically investigating the factors driving ETR and analyzing its sensitiveness because of one SD shock on its key determinants for Indian manufacturing firms from different sectors is the originality of this study. Developing a strong theoretical background and empirically validating it through advanced methodology makes the study unique.

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Mean reverting leverage policy in China: theory and evidence from industrial and sectorial level unit root analysis

Journal of Asia Business Studies ◽

10.1108/jabs-10-2016-0138 ◽

2018 ◽

Vol 12 (3) ◽

pp. 290-306 ◽

Cited By ~ 1

Author(s):

Ajid ur Rehman

Keyword(s):

Capital Structure ◽

Unit Root ◽

Unit Root Test ◽

Target Level ◽

Short Term ◽

Chinese Firms ◽

Content Type ◽

Leverage Ratio ◽

Stationary Behavior

Purpose This study aims to apply unit root test to investigate the behavior of Chinese firms toward their leverage policy. The study is based on two influential and competing theories of capital structure. Design/methodology/approach This study applies unit root test to investigate the behavior of Chinese firms toward their leverage policy. The study is based on two influential and competing theories of capital structure. Trade off theory advocates that firms have a target level of leverage ratio and that firms try to achieve that optimal leverage ratio, whereas pecking order theory argues that firms have no target level of leverage and that they follow a specific pattern of leverage. For this purpose, this study applies a Fisher type unit root test to 12,808 firm level observations. The data are unbalanced and cover a period from 1991 to 2014. Findings The results reveal the presence of a stationary behavior across short-term, long-term and total leverage policies. For short-term leverage policy, 21 per cent firms show stationary behavior, while for long-term, 20 per cent show a targeting behavior; for the total leverage policy 17 per cent of firms are found to follow a tradeoff model. To make the findings more interesting sample was further classified into profit and loss making firms. The study finds that loss making firms do not follow a target level of leverage in China. Furthermore, unit root is applied to all firms before and after crises-2008. It is revealed that stationary behavior is more prevalent before crises-2008. Originality/value This study is highly important from the point of view that it quantifies firms into distinct categories of following specific model of capital structure. To the best of the author’s knowledge, the findings of this study add to current research knowledge about Chinese firms with respect to adjustment behavior toward a target capital structure.

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Debt Financing and Firm Performance: Evidence from an Emerging South-Asian Country

Business and Economic Research ◽

10.5296/ber.v10i1.15910 ◽

2019 ◽

Vol 10 (1) ◽

pp. 40

Author(s):

Mohammad Mazibar Rahman ◽

Umme Khadija Kakuli ◽

Shahnaz Parvin ◽

Ayrin Sultana

Keyword(s):

Firm Performance ◽

Capital Structure ◽

Financial Performance ◽

Negative Influence ◽

Short Term ◽

Return On Assets ◽

Return On Equity ◽

Firm Financial Performance ◽

Total Debt

This paper aims to empirically investigate the impact of capital structure choice on the firm performance of the firms listed under the Dhaka Stock Exchange of Bangladesh. Multiple regression has been employed in this research to determine the relationship between the capital structure and the firm’s financial performance. Three ratios of financial performance, i.e., return on assets, return on equity, and gross margin, have been used as a sample of non-financial Bangladeshi companies, selected from 2010 to 2015. The study records numerous findings. First, the result shows a significant negative influence of long-term debt (LTD) and total debt (TTD) on firm financial performance measured by return on assets (ROA), but no significant relationship is found between short-term debt (STD) and this measure of firm’s financial performance. Moreover, the research found that there is no significant effect of short-term debt, long-term debt and total debt on the firm financial performance measured by return on equity (ROE). Finally, the result shows that a significant negative influence of short-term debt and total debt on firm performance measured by GM, but no significant relationship was found between long-term debt and financial performance. In general terms, the results of this study may suggest that capital structure has a negative influence on firms’ financial performance in Bangladesh.

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PENGARUH ROA, LEVERAGE, DAN CAPITAL INTENSITY TERHADAP TAX AVOIDANCE PADA PERUSAHAAN PERTAMBANGAN ERA JOKOWI – JK

MEDIA AKUNTANSI DAN PERPAJAKAN INDONESIA ◽

10.37715/mapi.v2i2.1723 ◽

2021 ◽

Vol 2 (2) ◽

pp. 125-138

Author(s):

Clarissa Octa Gumono

Keyword(s):

Agency Theory ◽

Tax Avoidance ◽

Capital Intensity ◽

The State ◽

Annual Reports ◽

Effective Tax Rate ◽

Return On Assets ◽

Mining Sector ◽

Tax Rate ◽

Independent Variable

Taxes are income for the state which are useful for financingstate activities and operations. Unfortunately, taxes are not profitable forcompanies. Taxes can decrease its profit. This situation triggers the companyto take action related to agency theory. This actions taken by managingtax financing so that it can be effective and efficient without violatingexisting regulations. That actions called tax avoidance. Tax avoidance takesadvantages of the grey area in the tax regulations so that the actions takenlegally. Tax avoidance in this study is used as the dependent variable bycalculating the cash effective tax rate (cash ETR). Independent variable inthis study are return on assets (ROA), leverage, and capital intensity. Theexistence of these variables are used to support the purpose of this study.The purpose of this study is to determine the influence of ROA, Leverageand Capital intensity on tax avoidance. The data used are from the financialreports and annual reports of mining sector companies listed in IndonesiaStock Exchange during the Jokowi - JK’s era.

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ANALISIS PENGARUH PROFITABILITAS LIKUIDITAS DAN PERTUMBUHAN PERUSAHAAN TERHADAP KEBIJAKAN UTANG SERTA DAMPAKNYA TERHADAP TARIF PAJAK EFEKTIF

Jurnal Riset Ekonomi dan Bisnis ◽

10.26623/jreb.v11i1.1075 ◽

2018 ◽

Vol 11 (1) ◽

pp. 22

Author(s):

Sri Sarwoasih ◽

Indarto Indarto

Keyword(s):

Hypothesis Test ◽

Test Model ◽

Sales Growth ◽

Effective Tax Rate ◽

Return On Assets ◽

Current Ratio ◽

Tax Rate ◽

Purposive Sampling ◽

Equity Ratio ◽

Asset Growth

Penelitian ini bertujuan untuk mengetahui pengaruh profitabilitas yang diproksikan dengan return on asset, pengaruh likuiditas yang diproksikan dengan current ratio serta pengaruh pertumbuhan perusahaan yang diproksikan dengan asset growth dan sales growth terhadap effective tax rate dengan debt to equity ratio sebagai variable intervening dan untuk mengetahui pengaruh return on asset dan sales growth secara langsung terhadap effective tax rate. Jenis data yang digunakan berupa data kuantitatif dengan metode purposive sampling, sampel penelitian adalah perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia tahun 2014–2016 sejumlah 108 sampel. Hasil uji hipotesis menyatakan return on asset dan current ratio berpengaruh signifikan terhadap debt to equity ratio, asset growth dan sales growth tidak berpengaruh signifikan terhadap debt to equity ratio, debt to equity ratio, return on asset, dan sales growth berpengaruh signifikan terhadap effective tax rate. Hasil sobel test model 1 : debt to equity ratio berhasil memediasi return on asset dan effective tax rate, Model 2 : debt to equity ratio tidak berhasil memediasi sales growth dan effective tax rate.This research aims to determine the effect of profitability proxies by return on assets, the influence of liquidity proxies by current ratio and the influence of the company’s growth proxies by asset growth and sales growth to the effective tax rate to the debt to equity ratio as intervening variable and to know the effect of return on asset and sales growth directly to effective tax rate. The types of data used in the form of quantitative data with using purposive sampling method, the sample research is a manufacturing company listed on the Indonesia Stock Exchange in 2014-2016 with number of samples are 108. Hypothesis test result : return on asset and current ratio has significant effect to debt to equity ratio, asset growth and sales growth has not significant effect on debt to equity ratio, debt to equity ratio, return on asset and sales growth has a significant effect on effective tax rate. The results of the sobel test model 1: debt to equity ratio succeed in mediating return on assets and effective tax rate, Model 2: debt to equity ratio did not succeed in mediating sales growth and effective tax rate.

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