Asia-Pacific Journal of Business (아태비즈니스연구)

KNU The Institute of Management & Economy Research (강원대학교 경영경제연구소)
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The Effect of Cash Holdings on Firm Value in Export Companies Listed in the KOSDAQ

코스닥시장에서 수출기업의 현금보유수준이 기업가치에 미치는 영향

  • Oh, Hee-Hwa (Department of Accounting & Taxation, Jeonju University) ;
  • Han, Kil-Seok (Division of Business Administration, Chonbuk National University)
  • 오희화 (전주대학교 회계세무학과) ;
  • 한길석 (전북대학교 회계학과)
  • Received : 2019.11.30
  • Accepted : 2019.12.24
  • Published : 2019.12.30
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Abstract

The purpose of this research is to investigate the effect of cash holdings on firm value in export companies. To investigate this effect, we analyzed 5,386 samples drawn from export companies listed in the KOSDAQ from 2011 to 2018. During this period, the International Financial reporting Standards have been employed. The research results are as follows. First, the results of a T-test showed that the level of the firm value of export companies with high levels of cash holdings is significantly higher than that of those with low levels of cash holdings. In addition, the level of the firm value of export companies with higher levels of cash holdings than in the previous year is higher than the level might otherwise be. Furthermore, the effects of cash holdings on firm value are similar to those on return on asset. These results suggested that export companies have little used a way of increasing their debt levels in order to increase cash holdings. Second, the results of a multivariate regression analysis presented that the cash holdings of export companies in listed the KOSDAQ significantly influence their firm value. Moreover, a higher level of cash holdings than in the previous year significantly affect firm value. These results proposed that making higher cash holdings than in the previous year might be useful in enhancing firm value. We found that export companies efforts to increase cash holdings positively influence changes in firm value. We also found that Korean export companies maintain their financial stability by obtaining sufficient liquidity specifically in a high uncertainty era like the recent time. We finally firmed an effort to maintain cash holdings as a reasonable choice for export companies.

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