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Abnormal inventory and performance in manufacturing companies: evidence from the trade credit channel / Godfred Adjapong Afrifa; Ahmad Alshehabi; Ishmael Tingbani; Hussein Halabi

Review of Quantitative Finance and Accounting

Swansea University Author: Hussein, Halabi

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Abstract

This paper examines the value of abnormal inventory and the channels through which firms decrease abnormally high inventory or increase abnormally low inventory for a sample of 976 United Kingdom (UK) manufacturing firms over the period from 2006 to 2015. Using GMM regressions, the results show that...

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Published in: Review of Quantitative Finance and Accounting
ISSN: 0924-865X 1573-7179
Published: Springer Science and Business Media LLC 2020
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URI: https://cronfa.swan.ac.uk/Record/cronfa54447
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first_indexed 2020-06-11T13:09:03Z
last_indexed 2020-09-23T03:16:49Z
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spelling 2020-09-22T10:14:32.4507806 v2 54447 2020-06-11 Abnormal inventory and performance in manufacturing companies: evidence from the trade credit channel f7e6b4295ab6a82be92bdd4e99587e73 0000-0003-4951-9981 Hussein Halabi Hussein Halabi true false 2020-06-11 BAF This paper examines the value of abnormal inventory and the channels through which firms decrease abnormally high inventory or increase abnormally low inventory for a sample of 976 United Kingdom (UK) manufacturing firms over the period from 2006 to 2015. Using GMM regressions, the results show that (i) an optimal inventory policy exists; and (ii) firms that are able to converge at this optimal inventory level byeither decreasing abnormally high inventory or increasing abnormally low inventory to improve operational and stock performance. Importantly, the results show that trade receivables and trade payables are the channels through which firms achieve efficient inventory management. Journal Article Review of Quantitative Finance and Accounting Springer Science and Business Media LLC 0924-865X 1573-7179 30 6 2020 2020-06-30 10.1007/s11156-020-00903-y COLLEGE NANME Accounting & Finance COLLEGE CODE BAF Swansea University University of Kent 2020-09-22T10:14:32.4507806 2020-06-11T12:29:04.3588482 School of Management Accounting and Finance Godfred Adjapong Afrifa 1 Ahmad Alshehabi 2 Ishmael Tingbani 3 Hussein Halabi 0000-0003-4951-9981 4 54447__17620__6dfe662e95444664947332df31849375.pdf Abnormal inventory.54447.VOR.pdf 2020-07-01T16:17:30.7150935 Output 798463 application/pdf Version of Record true Distributed under the terms of a Creative Commons Attribution 4.0 (CC-BY) Licence. true eng
title Abnormal inventory and performance in manufacturing companies: evidence from the trade credit channel
spellingShingle Abnormal inventory and performance in manufacturing companies: evidence from the trade credit channel
Hussein, Halabi
title_short Abnormal inventory and performance in manufacturing companies: evidence from the trade credit channel
title_full Abnormal inventory and performance in manufacturing companies: evidence from the trade credit channel
title_fullStr Abnormal inventory and performance in manufacturing companies: evidence from the trade credit channel
title_full_unstemmed Abnormal inventory and performance in manufacturing companies: evidence from the trade credit channel
title_sort Abnormal inventory and performance in manufacturing companies: evidence from the trade credit channel
author_id_str_mv f7e6b4295ab6a82be92bdd4e99587e73
author_id_fullname_str_mv f7e6b4295ab6a82be92bdd4e99587e73_***_Hussein, Halabi
author Hussein, Halabi
author2 Godfred Adjapong Afrifa
Ahmad Alshehabi
Ishmael Tingbani
Hussein Halabi
format Journal article
container_title Review of Quantitative Finance and Accounting
publishDate 2020
institution Swansea University
issn 0924-865X
1573-7179
doi_str_mv 10.1007/s11156-020-00903-y
publisher Springer Science and Business Media LLC
college_str School of Management
hierarchytype
hierarchy_top_id schoolofmanagement
hierarchy_top_title School of Management
hierarchy_parent_id schoolofmanagement
hierarchy_parent_title School of Management
department_str Accounting and Finance{{{_:::_}}}School of Management{{{_:::_}}}Accounting and Finance
document_store_str 1
active_str 0
description This paper examines the value of abnormal inventory and the channels through which firms decrease abnormally high inventory or increase abnormally low inventory for a sample of 976 United Kingdom (UK) manufacturing firms over the period from 2006 to 2015. Using GMM regressions, the results show that (i) an optimal inventory policy exists; and (ii) firms that are able to converge at this optimal inventory level byeither decreasing abnormally high inventory or increasing abnormally low inventory to improve operational and stock performance. Importantly, the results show that trade receivables and trade payables are the channels through which firms achieve efficient inventory management.
published_date 2020-06-30T04:17:31Z
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score 10.751705