Acta academica karviniensia 2017, 17(2):62-72 | DOI: 10.25142/aak.2017.014

THE RELATIONSHIP BETWEEN SELECTED FINANCIAL INDICATORS AND LIQUIDITY OF COMPANIES IN SELECTED SECTOR IN THE CZECH REPUBLIC

Markéta Šeligová
Slezská univerzita, Obchodně podnikatelská fakulta, Univerzitní nám. 1934/3,733 40 Karviná, Email:seligova@email.cz

The aim of this paper is to determine the impact of the selected financial indicators on liquidity of companies in selected sectors in the Czech Republic from 2000 to 2015. With the purpose to fulfill the aim, we examine existence and character of relationship between selected financial indicators (debt equity ratio, return on equity, share of fixed assets to total assets, share of earnings before interest and taxes to total assets) and liquidity of the companies in sectors such as mining and quarrying, manufacturing, construction, service sector and energy sector. The existence of relationship between financial indicators and liquidity of companies is tested by correlation analysis and regression analysis. The results show that there is the negative impact of share of fixed assets to total assets on liquidity of companies in service sector in the Czech Republic. The results also confirm a positive influence of return on equity on liquidity of companies and negative influence of debt equity ratio on liquidity of companies in energy sector in the Czech Republic.

Keywords: correlation, debt equity ratio, fixed assets, leverage ratio, liquidity, regression analysis, return on equity
JEL classification: G32

Received: February 9, 2017; Accepted: May 31, 2017; Published: June 30, 2017  Show citation

ACS AIP APA ASA Harvard Chicago Chicago Notes IEEE ISO690 MLA NLM Turabian Vancouver
Šeligová M. THE RELATIONSHIP BETWEEN SELECTED FINANCIAL INDICATORS AND LIQUIDITY OF COMPANIES IN SELECTED SECTOR IN THE CZECH REPUBLIC. Acta academica karviniensia. 2017;17(2):62-72. doi: 10.25142/aak.2017.014.
Share...
Download citation
  • BibTeX (.bib)
  • Bookends (.ris)
  • EasyBib (.ris)
  • EndNote (.enw)
  • EndNote 8 (.xml)
  • ISI WoS (.isi)
  • Medlars (.medlars)
  • Mendeley (.ris)
  • MODS (.xml)
  • Papers (.ris)
  • RefWorks (.txt)
  • RefManager (.ris)
  • RIS (.ris)
  • MS Word (.xml)
  • Zotero (.ris)
    • Open full article

    References

    1. ANDERSON, R. W., 2002. Capital structure, firm liquidity and growth. Working papers-research series. National Bank of Belgium. [online] [vid. 1. února 2017]. Dostupné z:: www.nbb.be/doc/ts/publications/wp/WP27en.pdf.
    2. DE JONG, A., R. KABIR and T. T. NGUYEN, 2008. Capital structure around the world: the roles of firm and country-specific determinants. Journal of banking and finance, 32, 1954-1969. Go to original source...
    3. LIPSON, M. L. and S. MORTAL, 2009. Liquidity and capital structure. Journal of Financial Markets. 12(4), 611-644. ISSN 1386-4181. Go to original source...
    4. MEHAR, A., 2005. Impacts of equity financing on liquidity position of a firm. Applied Financial Economics, Vol. 15, 425-438. ISSN 1466-4305. Go to original source...
    5. MILOŞ, M. C., 2015. Capital Structure Determinants. Evidence from the Romanian Listed Companies. Analele Universitatii 'Eftimie Murgu' Resita. Fascicola II. Studii Economice, 129-134. ISSN 2344-6315.
    6. MYERS, S. C., 2001. Capital structure. The journal of economic perspectives, 15(2),81-102. Go to original source...
    7. RŮČKOVÁ, P., 2015. Impact of Liquidity and Profitability on Use of Debt Finance Sources of Companies in Manufacturing Industry in V4 Countries. Acta academica Karviniensia, 15(3), 69-79. ISSN 1212-415X. Go to original source...
    8. SALEEM, Q. and U. R. REHMAN, 2011. Impacts of liquidity ratios on profitability. Interdisciplinary Journal of Research in Business, 1(7). 95-98. ISSN 2249-4588.
    9. SHAH, P., 2012. Evaluation of Profitability and Liquidity Relationship through Multivariate Working Capital Analysis. A Management Journal, 3(2),177. ISSN 2348-5302.
    10. SCHLEIFER, A. and R. W. VISHNY, 2001. Stock Market Driven Acquisitions. Journal of Financial Economics [online]. [vid. 1. února 2017]. Dostupné z: papers.ssrn.com/sol3/papers.cfm?abstract_id=278563. Go to original source...
    11. STULZ, R., 1990. Managerial discretion and optimal financing policies. Journal of financial Economics, 26(1), 3-27. ISSN 0304-405X Go to original source...
    12. ŠARLIJA, N. and M. HARC, 2012. The impact of liquidity on the capital structure: a case study of Croatian firms, Business Systems Research, 3(1), 30-36. Go to original source...
    13. TRIPPNER, P., 2013. Analysis of Financial Liquidity Management in the Enterprise and its Impact on the Profitability. 494 - 501.
    14. WILLIAMSON, O. E., 1988. Corporate Finance and Corporate Governance. Journal of Finance, 43(3), 567-591. ISSN 1540-6261. Go to original source...

    Return to the content