Cash Conversion Cycle and Firm’s Performance of Japanese Firms
Nobanee, H., Abdullatif, M., AlHajjar, M. (2011). Cash Conversion Cycle and Firm’s Performance of Japanese Firms. Asian Review of Accounting, 19(2), 147-156.
11 Pages Posted: 19 Jul 2010 Last revised: 1 Jan 2018
Date Written: July 19, 2010
Abstract
In this paper we investigate the relation between the firm’s cash conversion cycle and its profitability. This relationship is examined using dynamic panel data analysis for the full sample, by industry and by size. Using a sample of 34771 firm years covering the period 1990-2004, we find a strong negative relation between the length of the firm’s cash conversion cycle and its profitability in all our study samples except for consumer goods companies and services companies.
Keywords: Working Capital Management, Cash Conversion Cycle, Return on Investment
JEL Classification: G30
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