The Moderating Role of Firms characteristics on the Relationship between Working Capital Management and Financial Performance

Document Type : Research Paper


Department of Accounting, Faculty of Economic and Social Sciences, Bu-Ali Sina University, Hamedan, Iran



Optimal working capital management can positively effect on the Firm performance, but this relationship can be affected by major characteristics of the firm, making an important subject for research. This research investigates the moderating role of firm characteristics on the relation between working capital management and financial performance of the firms listed in TSE during 2008 – 2017 period. Based on existing researches, three characters are considered as moderating variables in this research include firm size, debt ratio, and Governmental ownership. Financial performance and working capital management are measured using return on assets (ROA) and cash conversion cycle (CCC), respectively. We use from multivariate regression model with panel data for test of research hypotheses. The Results of this study show that, firm size affects the Relation between CCC (as a measure of working capital management) and ROA (as a measure of firm performance). However, debt ratio and Governmental ownership don’t any significant effect on the relationship between working capital management and financial performance of firms


Main Subjects

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Volume 4, Issue 1
March 2019
Pages 71-88
  • Receive Date: 25 December 2018
  • Revise Date: 20 February 2019
  • Accept Date: 21 February 2019
  • First Publish Date: 01 March 2019