Determinants of Cash Retention in Brazilian Companies: An Analysis After the 2008 Crisis

Authors

  • Vanessa Rabelo Dutra Universidade Federal de Santa Maria http://orcid.org/0000-0003-2841-8495
  • Igor Bernardi Sonza Universidade Federal de Santa Maria
  • Paulo Sergio Ceretta Universidade Federal de Santa Maria http://orcid.org/0000-0001-8264-0439
  • Oscar Claudino Galli Universidade Federal do Rio Grande do Sul

DOI:

https://doi.org/10.17524/repec.v12i3.1808

Keywords:

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Abstract

Objective: This paper aims to analyze the determinants of cash retention in Brazilian companies through the literature presuppositions related to the transaction, speculation, precaution, taxes and governance problems. Method: The sample consists of the companies listed on BM&FBOVESPA between 2010 and 2015. The data were collected in the Economática database and the Threshold panel data model was applied, which permits describing the changes or structural breaks in the variables for different individuals, segmenting the sample based on the value of a given observed variable. Results: Three regimes were found, defined by the variable size, splitting the sample into larger, intermediate and smaller companies. The transactions and taxes were the main reasons to reduce the cash retention for smaller companies. The reasons related to the precaution for bigger companies and to the governance problems for smaller companies presented a positive relation with the cash variation, corroborating with the theory, but do not explain this change in the Brazilian companies. The speculation was not significant in any regimen. Contributions: The research contributes to enrich the bibliography on cash retention and differs from the approaches proposed in the literature using the method applied.

Author Biographies

Vanessa Rabelo Dutra, Universidade Federal de Santa Maria

Doutoranda em Administração pela Universidade Federal de Santa Maria.

Igor Bernardi Sonza, Universidade Federal de Santa Maria

Doutorado em Administração pela Universidade Federal do Rio Grande do Sul. Professor da Universidade Federal de Santa Maria.

Paulo Sergio Ceretta, Universidade Federal de Santa Maria

Doutorado em Engenharia de Produção pela Universidade Federal de Santa Catarina, Professor Associado da Universidade Federal de Santa Maria.

Oscar Claudino Galli, Universidade Federal do Rio Grande do Sul

Doutorado em Engenharia de Produção pela Universidade Federal de Santa Catarina Professor Associado na Universidade Federal do Rio Grande do Sul

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Published

2018-09-23

How to Cite

Dutra, V. R., Sonza, I. B., Ceretta, P. S., & Galli, O. C. (2018). Determinants of Cash Retention in Brazilian Companies: An Analysis After the 2008 Crisis. Journal of Education and Research in Accounting (REPeC), 12(3). https://doi.org/10.17524/repec.v12i3.1808

Issue

Vol. 12 No. 3 (2018): July-September

Section

Articles

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