Comparison of Working Capital Management, Capital Structure and Real Investment Policies among Active and Bankrupt Firms in Tehran Stock Exchange

Abstract

Financial planning is one of the important factors affecting firm success in a way to maximize firm value through proper combination of assets, debts and equity.
Policies of working capital management, real investment and capital structure are the most important components of financial planning. The aim of this research is to identify the differences in working capital management, real investment and capital structure between active and bankrupt firms. Statistical population of the research is all listed firms in Tehran stock Exchange during 2009-2014. Finally 186 firms are chosen as statistical sample of the research based on systematic sampling. The data has been analyzed by two-sample t test using SPSS software. The findings indicate that among measures of working capital
management, accounts payable period and accounts receivable period differ among active and bankrupt firms. But inventory turnover period and cash turnover period are not different. Among measures of capital structure,
findings confirm difference in long term debt to total asset ratio, short term debt to total assets ratio and total debt to total asset among active and bankrupt firms. But it doesn’t confirm the result for debt to equity ratio. Finally active
and bankrupt firms don’t have differences fixed assets.