PENGARUH FREE CASH FLOW TERHADAP RETURN: DIMODERASI KESEMPATAN INVESTASI DAN SIKLUS HIDUP

Farama, Jefry and Midiastuty, Pratana Puspa (2014) PENGARUH FREE CASH FLOW TERHADAP RETURN: DIMODERASI KESEMPATAN INVESTASI DAN SIKLUS HIDUP. Jurnal Akuntansi, 2 (1). pp. 78-105. ISSN 2303-0356

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Abstract

ABSTRACT The aims of this research is to find empirical evidence about the influence of free cash flow to return with moderation by investment opportunity set and life cycle of firm. This study tested the influence of free cash flow (either positiveFCF and negative FCF). At each of IOS level, either high or low and was related to the life cycle of firm phases. Sample used in this study are selected using purposive sampling from non financial companies and have listed in Indonesian Stock Exchange (IDX) during period 2003 up to 2006. the obtained samples were 131 companies with 524 observations. Overall the result of the study (H1), showing that positive FCF has a positive and significant to the return rater than the negative FCF. For H2 testing result showed thet FCF(either positive FCF and negative FCF) have unsignificant effect when company with high IOS. Then, for H3 testing result showed an unsignificant effect as well, so conclude that, the present and exiting FCF doesn’t show that the firm is at start-up – mature phase yet certainly, which indicates that the phase, the companies has a high IOS level. FCF of the start-up – mature phase may be caused by a highleverage, because the firm tend to use any external fund. This external fund usage is possible bacause the lack of internal fund to donate the whole of investment.

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