MICHAELJ. PEEL IS A LECTURER IN accountancy and finance at Cardiff Business School, University of Wales, and Nicholas Wilson is Professor of Credit Management at the University of Bradford, England. Very little research has been conducted on the capital budgeting and working capital practices of small firms. The purpose of this paper is to present the results of a preliminary study on the working capital and financial management practices of a sample of small firms located in the north of England. In general, the results of the survey indicated that a relatively high proportion of small firms in the sample claimed to use quantitative capital budgeting and working capital techniques and to review various aspects of their companies' working capital. In addition, the firms which claimed to use the more sophisticated discounted cash flow capital budgeting techniques, or which had been active in terms of reducing stock levels or the debtors' credit period, on average tended to be more active in respect of work...

Working Capital and Financial Management Practices in the Small Firm Sector

http://www.geocities.ws/smhurtado/2000-111-3-367-385.pdf

Fuzzy capital budgeting

In this paper, an attempt has been made to examine the determinants of capital structure -size, business risk, growth rate, earning rate, dividend payout, debt service capacity, and degree of operating leverage-of the companies listed to Nepal Stock Exchange Ltd. as of July 16, 2003. Eight variables multiple regression model has been used to assess the influence of defined explanatory variables on capital structure. In the preliminary analysis, manufacturing companies, commercial banks, insurance companies, and finance companies were included. However, due to the unusual sign problem in the constant term of the model, manufacturing companies were excluded in final analysis. This study shows that size, growth rate and earning rate are statistically significant determinants of capital structure of the listed companies.

 Journal of Nepalese Business Studies Vol.1(1) 2004 pp. 1-13

/pdf/determinants-of-capital-structure-a-case-study-of-listed-3nwqyk1qmd.pdf

Determinants of Capital Structure: A Case Study of Listed Companies of Nepal

An enduring problem facing microfinance institutions is how to attain financial sustainability Several studies have been conducted to determine the factors affecting financial sustainability of microfinance institutions using large and well developed MFIs in various countries However, no such study has been conducted in rural Tanzania where majority of MFIs are small, most of which are member-based (cooperatives) Consequently, the factors affecting their financial sustainability are not known This study, therefore, was set to bridge this knowledge gap

This study followed a quantitative research approach using panel data regression as the main data analysis technique The study was based on four years primary and secondary data obtained from 98 sampled rural MFIs in Tanzania We found that microfinance capital structure, interest rates charged, differences in lending type, cost per borrower, product type, MFI size, number of borrowers, yield on gross loan portfolio, level of portfolio at risk, liquidity level, staff productivity, and the operating efficiency affect the financial sustainability of rural microfinance institutions in Tanzania

The study makes the following key contributions to knowledge in addition to determining factors affecting financial sustainability of rural microfinance institutions in Tanzania: First, the study reveals that there exists simultaneous causality relationship between financial sustainability and breadth of outreach When this relationship is not considered in determining factors affecting financial sustainability there may be inconsistent evidence on the existence of mission drift Second, it unveils the trade-off between financial sustainability and breadth of outreach with regards to the minimum loan size when group lending is used That is, larger loan size, while improves profitability, reduces the breadth of outreach Third, the study provides empirical evidence that the impact of a particular lending type on microfinance institution‟s profitability will depend on the term to maturity and number of instalments reflected in its lending terms Fourth, consistent with the institutionists‟ view, the study provides empirical evidence that financial sustainability of microfinance institutions improves their breadth of outreach Lastly, the study documents the applicability and limitations of previous studies to rural microfinance institutions in Tanzania

/pdf/financial-sustainability-of-rural-microfinance-institutions-1i1d7wufoi.pdf

Financial sustainability of rural microfinance institutions (MFIs) in Tanzania

This paper attempts to provide an empirical validation of the widely held existing theories on the determinants of firm performance in the Indian context. The study uses financial statement and capital market data of 566 large Indian firms over a time frame of eight years divided into two sub-periods (viz., 1992-96, and 1996-2000) to study Indian firms' financial performance across various dimensions viz., shareholder value, accounting profitability and its components, growth and risk of the sample firms. It reveals that even on the same data, the determinants of market-based performance measures and accounting-based performance measures differ due to influence of 'Capital Market Conditions'. We found that size, marketing expenditure, and international diversification had a positive relation with a firm's market valuation. Apart from these firm attributes that reflect either operating parameters of firms or 'strategic choice' of firm managers, we also found that a firm's ownership composition, particularly the level of equity ownership by Domestic Financial Institutions and Dispersed Public Shareholders, and the leverage of the firm were important factors affecting its financial performance. The different implications of the findings for various stakeholders of a firm are also discussed.

https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID904983_code585980.pdf?abstractid=904983&mirid=1

Determinants of Financial Performance of Indian Corporate Sector in the Post-Liberalization Era: An Exploratory Study

1. An Introduction to Financial Management.Appendix: Methods of Depreciation. 2. The Role of Financial Markets and Interest Rates in Financial Management. 3. Evaluating a Firms Financial Performance and Measuring Cash Flow. 4. Financial Forecasting, Planning, and Budgeting. 5. The Time Value of Money. 6. Risk and Rates of Return.Appendix: Measuring the Required Rate of Return: The Arbitrage Pricing Model. 7. Bond Valuation. 8. Stock Valuation.Appendix: The Relationship Between Value and Earnings. 9. Capital-Budgeting Decision Criteria. 10. Cash Flows and Other Topics in Capital Budgeting. 11. Capital Budgeting and Risk Analysis. 12. Cost of Capital. 13. Analysis and Impact of Leverage. 14. Planning the Firms Financing Mix. 15. Dividend Policy and Internal Financing. 16. Working-Capital Management and Short-Term Financing. 17. Cash and Marketable Securities Management.Appendix: Cash-Management Models: Split Between Cash and Near Cash. 18. Accounts Receivable, Inventory, and Total Quality Management. 19. Term Loans and Leases. 20. The Use of Futures, Options, and Currency Swaps to Reduce Risk.Appendix: Convertible Securities and Warrants. 21. Corporate Restructuring: Combinations and Divestitures. 22. International Business Finance. Appendix A: Using a Calculator. Appendix B: Compound Sum of $1. Appendix C: Present Value of $1. Appendix D: Sum of an Annuity of $1 for n Periods. Appendix E: Present Value of an Annuity of $1 for n Periods. Appendix F: Solutions for Selected End-of-Chapter Problems. Glossary. Organization Index. Subject Index.

Arthur J. Keown

Papers

Basic Financial Management