Trade credit determinants of manufacturing companies in Malaysia

• Main Author: Noor Fariza, Mohd Hasini
• Format: Thesis
• Language: English; English
• Published: 2018
• Subjects: HG Finance
• Online Access: https://etd.uum.edu.my/7815/1/s812015_01.pdf; https://etd.uum.edu.my/7815/2/s812015_02.pdf; https://etd.uum.edu.my/7815/; https://sierra.uum.edu.my/record=b1699295~S1

This study examines the determinants of trade credit of manufacturing sector in Malaysia for the period 2013-2017. Utilizing a sample of 114 manufacturing companies listed on Bursa Malaysia, the findings suggest that size negatively influences trade credit, indicating that smaller firms rely more on trade credit to finance their operations. Whereas, firm age and inventory have a positive and significant relationship with trade credit. This implies that older firms and firms with high inventory level use more trade credit as the financial source. This study does not find conclusive evidence to support that the profitability, assets structure, and sales growth influence the level of trade credit of manufacturing companies in Malaysia.