| dc.description.abstract | The main purpose of this research is to examine the relationship between cash conversion cycle with levels of liquidity, invested capital, and performance in manufacturing firms over time. Our dataset ranges from 2014 to 2018 covering 116 manufacturing firms (non- financial firms) listed on Ho Chi Minh City stock. The study detects relationship between cash conversion cycle with firm performance, liquidity and capital requirements in manufacturing firms in Vietnam change over time. Nevertheless, the study shows the significance of cash conversion cycle as a proactive management tool for manufacturing firm owners. The dependent variable of the regression model are cash conversion cycle, change in cash conversion cycle and independent variables are invested capital, liquidity and firm performance. In addition, four control variables that are industy and firm size are attached in the model.
In the first model, Fixed-effects regression model was chosen to analyze the panel data. It is identified that invested capital does not have significant effect on cash conversion cycle. At first, liquidity level in the firms affected significantly cash conversation cycle in case of the researcher ignores the difference between period and cross section. However, when both the difference between period and cross section are counted, liquidity level in the firms does not affect cash conversation cycle. Moreover, the researcher recognizes the importance of the difference between period and cross section, firm size plays significant role towards cash conversation cycle.
The second model explores how change in cash conversation cycle affected by firm size. The result shows that change in cash conversation cycle of examined firms is affected negatively and significantly by firm size and change in cash conversation cycle is affected positively and significantly by lag one year invested capital, lag one year asset turnover, and lag one year returned on invested capital. However, lag one-year of liquidity does not have significant effect ton change in cash conversation cycle. It is remarked that invested capital does not affect significantly cash conversation cycle | en_US |
