The impact of corporate trade credit policy on profitability ratios: a case study of listed companies in the Vietnamese basic materials industry

2021 ◽  
Vol 15 (2) ◽  
Keyword(s):  
Trade Credit ◽  
Listed Companies ◽  
Credit Policy ◽  
The Impact ◽  
Profitability Ratios

scholarly journals Effect of Trade Credit on Firms Growth: A Case Study of Pakistani Non-financial Firms

2019 ◽  
Vol 5 (2) ◽  
Author(s):  
Hafiz M. Adnan Hanif
Keyword(s):  
Panel Data ◽  
Firm Growth ◽  
Trade Credit ◽  
Panel Data Analysis ◽  
Method Of Moment ◽  
Listed Firms ◽  
Financial Firms ◽  
Generalized Method Of Moment ◽  
The Impact

This study attempts to investigate the impact of trade credit on the growth of non-financial firms of Pakistan. Most of the businesses move from traditional business transactions to automated and sophisticated credit transaction methods. As large firms have better access to financial institutions and markets but still, they are interested to seek firm growth by adopting the trade credit policies. This study collects information from non-financial firms of Pakistan. Panel data is used to explore the impact of trade credit on firms growth. The data collect from the year 2001- 2015 of 257 non-financial firms of Pakistan. A technique of panel data analysis, generalized method of moment used to analyze the data. The results suggest that the trade credit and GDP have a positive significant impact on firms’ growth. Moreover, Firm’s age, its size and inflation in the economy have also impacted the firm’s growth but in negative direction. Finally, the non-financial listed firms of Pakistan can achieve their growth targets by adopting trade credit policies

Corporate misconduct, trade credit and charitable donations: evidence from Chinese listed companies

2019 ◽  
Vol 13 (3) ◽  
pp. 664-686
Author(s):  
Zheming Liu ◽  
Saixing Zeng ◽  
Xiaodong Xu ◽  
Han Lin ◽  
Hanyang Ma
Keyword(s):  
Trade Credit ◽  
Negative Impact ◽  
Listed Companies ◽  
Corporate Misconduct ◽  
Content Type ◽  
Charitable Donations ◽  
Chinese Listed Companies ◽  
Significant Negative Impact ◽  
The Impact ◽  
Laws And Regulations

Purpose The purpose of this paper is to investigate how revelations of corporate misconduct are associated with trade credit. Specifically, it investigates how this association varies in different regions, in different types of industries and in response to companies’ subsequent charitable donations. Design/methodology/approach The authors empirically tested various hypotheses using a sample of 2,725 Chinese A-share listed companies from 2009 to 2014 based on signaling theory. Fixed effect models underpinned the methods used. Findings The authors found that corporate misconduct has a significant negative impact on an irresponsible company’s trade credit received and granted, and the negative impact is heterogeneous for different regions and industries. There is no evidence that charitable donations mitigate the effect on the trade credit of irresponsible companies following revelations of corporate misconduct. Practical implications The results suggest that listed companies in China should obey national and local laws and regulations if they wish to avoid the risk of significant trade credit loss. If a company’s violation of these laws and regulations is disclosed, making charitable donations is not an effective strategy for safeguarding trade credit. Originality/value This study enriches understanding on the consequences of corporate misconduct and extends the literature on trade credit. It fills a research gap by identifying the impact of corporate misconduct on trade credit.

scholarly journals The impact on the equity value of listed companies pledge - A Case Study of La Chapelle

2021 ◽  
Vol 275 ◽  
pp. 01077
Author(s):  
Fang Liu
Keyword(s):  
Listed Company ◽  
Rapid Development ◽  
Listed Companies ◽  
Bank Loans ◽  
Securities Market ◽  
Object A ◽  
Equity Value ◽  
The Impact ◽  
A Share

With the rapid development of China’s securities market, bank loans as an important channel of enterprise financing has been unable to meet the capital needs of most enterprises, this article is based on the A-share main board listed company and equity pledge ratio as the research object, a case study of rashabel’s equity. It is concluded that the value of the company is inversely proportional to the proportion of the allocated equity. We should distribute equity reasonably, balance the power among shareholders, so as to improve the efficiency of governance and strengthen the supervision of large shareholders.

The impact of corporate distress along the supply chain: evidences from United States

2019 ◽  
Vol 24 (4) ◽  
pp. 498-508 ◽  
Author(s):  
Lucia Gibilaro ◽  
Gianluca Mattarocci
Keyword(s):  
Supply Chain ◽  
Trade Credit ◽  
The Other ◽  
Credit Policy ◽  
Growth Opportunities ◽  
Supply Chain Disruption ◽  
Content Type ◽  
Performance Risk ◽  
The Impact ◽  
Corporate Distress

PurposeThe aim of the study is to provide evidence on the distress in the supply chain and its impact on the trade credit policy, firms’ performance and risk and their growth opportunities. Trade credit creates a strict relation between suppliers and customers that cannot be easily substituted over time. The linkages established between firms in a supply chain are a key value added for all members that could represent a competitive advantage over independent market players. In the event of a supply chain disruption, all members could suffer from a decrease in profitability and an increase in risk. Nonetheless, no empirical evidence exists on the expected economic and financial effects on pertinent suppliers and customers.Design/methodology/approachThis paper examines the US market and evaluates the impact of a supply chain member’s default on the other members, looking at both the customers’ and suppliers’ default. The sample considers all firms in the USA disclosing entry into bankruptcy proceedings through EDGAR filings that were not classified as financial intermediaries between 2012 and 2016. The analysis considers the effect of distress on the supply chain (suppliers or customers) on the trade credit policy, performance, risk and growth perspectives of connected firms.FindingsThe results show that a supply chain disruption not only modifies the trade credit policy but also affects firm risk and profitability and the financing sources available to support firm growth. Empirical evidence shows that the bankruptcy of a member of the supply chain affects the trade credit policy of all the other members. The costs related to default are economically and financially relevant to all supply chain members and affect the resiliency of the supply chain beyond the short term.Originality/valueThis paper uses an original and innovative database to empirically test the impact of corporate distress on supply chain financing, performance, risk and growth opportunities.

Optimal trade credit and replenishment policies for non-instantaneous deteriorating items

2020 ◽  
Vol 54 (6) ◽  
pp. 1793-1826
Author(s):  
Anuj Kumar Sharma ◽  
Sunil Tiwari ◽  
V.S.S. Yadavalli ◽  
Chandra K. Jaggi
Keyword(s):  
Solution Method ◽  
Trade Credit ◽  
Optimal Solution ◽  
Inventory Model ◽  
Deteriorating Items ◽  
Selling Price ◽  
Credit Policy ◽  
Demand Rate ◽  
Fuzzy Inventory ◽  
The Impact

The present study presents a fuzzy inventory model for non-instantaneous deteriorating items under conditions of permissible delay in payments. In the current paper, we incorporate the condition in which, the supplier accepts the partial payment at the end of the credit period and the reaming amount after that period under the term and condition. Here, the demand rate is a function of the selling price. Also, it is assumed that shortages are allowed and are fully backlogged. The present paper also considers that the interest earned (IE) on the fixed deposit amount, i.e., revenue generated by fulfilling the shortage, balance amount, after settling the account is higher than that of usual interest rate (Ie). Hence, the objective of this study is to determine the retailer’s optimal policies that maximize the total profit. Also, some theoretical results are obtained, which shows that the optimal solution not only exists, it is unique also. The impact of the new proposed credit policy is investigated on the optimality of the solution for the non-instantaneous deteriorating products. The validation of the proposed model and its solution method is demonstrated through the numerical example. The results indicate that the inventory model, along with the solution method, provides a powerful tool to the retail managers under real-world situations. Results demonstrate that it is essential for the managers to consider the inclusion of new proposed credit policy significantly increases the net annual profit.

scholarly journals The Impact of Credit Policy on the Performance of Nigerian Commercial Banks

2014 ◽  
Vol 1 (2) ◽  
pp. 40 ◽  
Author(s):  
Ayodele Thomas D. ◽  
Raphael O. Alabi
Keyword(s):  
Commercial Banks ◽  
Primary Data ◽  
Financial Intermediaries ◽  
Credit Policy ◽  
High Quality ◽  
Chi Square ◽  
High Level ◽  
The Impact

The major financial intermediary in any economy is the bank. As financial intermediaries, banks provide means by which funds can be transferred from the surplus unit of the economy to the deficit unit. This role is performed primarily through the acceptance of deposits of different categories and characteristics for onward lending to the numerous customers by way of loans and credits. The study tries to access the impact of credit policy on the performance of Nigerian Commercial Banks using Zenith Bank Plc as case study. Primary data were collected through questionnaires served on sixty (60) respondents (staff: 32 and customer: 28) of the bank. The questionnaires were analysed with the use of chi-square (X2). The findings from the study show that having a good credit policy in place goes a long way in minimizing the incidence of bad debts. It was also discovered that prudent credit assessment and disbursement, dynamic credit monitoring and decisive actions when there are warning signals, have all helped the bank to maintain a high quality of assets and a high level of profitability.

Sign in / Sign up

Export Citation Format

Share Document