THE EFFECT OF CASH HOLDING ON IRANIAN CO. PERFORMANCES

Abstract

Nowadays, according to the increasing importance of the cash reserves process, decisions for determining the amount of cash reserves have been changed to one of the significant factors in corporate finance literature; therefore, the affecting factors on cash assets have attracted the attention of many researchers. In this research, the relationships between Inc. properties and cash reserves in company have been evaluated. To do this research, a sample consists of 71 companies listed on Tehran stock exchange through the years of 2008-2013 have been chosen. Estimating the statistical model of research, the method of multivariate linear regression by panel data has been used. The research findings show that: 1) The Iranian companies don’t maintain a large amount of cash. 2) There is a negative relationship between cash held level and firm scale. 3) There is a positive relationship between cash held level and leverage. 4) There is a positive relationship between cash held level and cash flow. 5) There is a positive relationship between cash held level and working capital. 6) There is not any significant relationship between cash held level and company business growth opportunities and dividends.