Suchergebnisse

This assessment of the Basel Core Principles (BCP) was conducted as part of the financial sector assessment program (FSAP) update evaluation of the El Salvador financial system from April 22 to May 10, 2010. The supervisory framework was assessed against the BCP methodology issued in October 2006. The assessment of compliance with each principle is made on a qualitative basis. A four-part assessment system is used: compliant; largely compliant; materially noncompliant; and noncompliant. A largely compliant assessment is given if only minor shortcomings are observed, and these are not seen as sufficient to raise serious doubts about the authority's ability to achieve the objective of that principle. A materially noncompliant assessment is given when the shortcomings are sufficient to raise doubts about the authority's ability to achieve compliance, but substantive progress has been made. A noncompliant assessment is given when no substantive progress toward compliance has been achieved. The ratings assigned during this assessment are not comparable to the ones assigned in the 2000 FSAP, as the bar to measure the effectiveness of a supervisory framework has been raised in the new methodology. This paper is structures as follows: introduction; information and methodology used for assessment; institutional and macroeconomic setting and market structure- overview; preconditions for effective bank supervision; main findings; and recommended action plan and authorities' response.

Over the past dozen years, policymakers have largely abandoned long-standing popular approaches for addressing risk in agriculture without fully resolving the question of how best to manage the negative consequences of volatile agricultural markets. The article reviews the transition from past policies and describes current approaches that distinguish between the trade-related fiscal consequences of commodity market volatility and the consequences of price and production risks for vulnerable rural households and communities. Current policies rely more heavily on markets, even though markets for risk are incomplete in numerous ways. The benefits and limitations of market-based instruments are examined in the context of risk management strategies, and innovative approaches to extend the reach of risk markets are discussed.

Against the background of a new Labor Day weekend job report that found zero job net growth for the month of August, Republican candidates held another debate, this time under the auspices of MSNBC, not Fox. It took place in the Reagan library, in Simi Valley, California, with the 1980s Air Force One plane used by Reagan looming behind them as a powerful yet incongruent décor. Texas Governor Rick Perry, who entered the race three weeks ago and has already managed to reshape it, made it a contest between himself and Mitt Romney. Jon Huntsman is now a distant third in the polls, and the rest have been consigned to the back bench. Perry has consolidated support across a large swath of the Republican base, including Tea Partiers and the Evangelical right and already has amassed a war chest of campaign funds from contributors from Texas and across the country. Interestingly enough, Karl Rove, the self appointed kingmaker of the GOP and former GW Bush closest advisor, has come out against Perry, calling some of his views "toxic".As the first fundamental tests of the Republican primary approach, the campaign clearly entered a new stage last Wednesday during a debate that was mainly a duel between two protagonists, while the rest, acting as a Greek chorus reinforcing or challenging their responses, were given very little time by hosts Brian Williams (NBC) and John Harris (Politico). The primary field as first constituted was lackluster and therefore demanded new candidates. Perry seems to have satisfied that demand for the time being. Nevertheless, after the debate there was still some discontent among establishment Republicans, so the race is still fluid and new candidates may jump in before the first deadline in October.Governor Perry, as the front-runner in the latest polls, was not surprisingly the target of most of the others throughout the night. He has executive experience, a commanding demeanor, and a record to run on. Although not completely articulate, and lacking Romney's polished eloquence, he is tough and quick in his retorts, and his rhetoric resounded with the audience, drawing the strongest applause every time. His claim that he has created more jobs in Texas than Obama has managed to create nationally may be a winner with voters, but Texas' record on almost every other issue is unflattering and thus, main ammunition for his opponents. He was reminded, for example, that of all fifty states, Texas is last on education, to which he responded that Texas' problems stem from its long border with Mexico. That probably did not go well with the Hispanic voters watching on Univisión and Telemundo, but Perry doesn't seem to care, since he is riding the wave of anti-Latino feelings around the country. Confronted with the claim that Texas has the largest number of people without health insurance than all other 49 states , he did not give a direct answer but chose instead to mumble something about how "all Texans want is to get the federal government out of their lives". Both Michelle Bachman and Rick Santorum questioned Perry's social conservatism given his policy as governor, for example, to inoculate adolescent girls against HPV, which they portrayed as a government intrusion into the family realm and a license to practice pre-marital sex. And Ron Paul, a congressman from Texas, was a constant goad on the Governor's side, reminding the public that Perry used to be a Democrat and wholeheartedly supported Al Gore on his presidential bid in 1988. Perry defended himself well as he dismissed all the charges against him with one-liners and a disdainful smile. A shrewd politician and experience campaigner, he took the initiative at every turn and was able to steer the conversation to his own record of job creation as governor of Texas, contrasting it mockingly with Romney's as governor of Massachusetts. But Romney appeared unfazed as he joked that Perry could not take credit for everything that has gone well in the State of Texas, including its wealth of oil and gas, its zero state income tax and the (related) fact that main corporations made their headquarters there long before Perry was governor. Massachusetts is a much smaller state and has none of those advantages, he added. There were several quick exchanges like this: both candidates were well prepared to respond with facts and statistics, and the perception was that they both did well, with Perry defending himself aggressively at times and Romney maintaining his smooth and relaxed demeanor, even as he waited for the opportunity to deliver a blow to his new challenger.Host Brian Williams soon gave him that opportunity by asking Perry a question about Social Security, the government pension fund that experts say, will become insolvent in the year 2036 if it is not reformed. Perry's answer, which confirmed similar statements in his recently published book, made all the headlines the next day. He called it a "Ponzi scheme' (implying a criminal enterprise) and added that it was a "monstrous lie" to tell young people under thirty that they would get their Social Security when their time comes for them to retire: they won't. This statement has been reported by the Romney campaign as Perry's Waterloo: no candidate will win an election by making this kind of claim against the "third rail" of politics, a cherished and untouchable public trust; to do so is pure political suicide. Similar claims had prompted Karl Rove's comment about Perry's toxicity and spurred doubts about his electability. Ironically, it is the rhetoric and not the substance that separates the two candidates on this issue: as presidents, both would likely propose some privatization of Social Security, perhaps in the form of personal retirement accounts that can be managed by the workers themselves and would allow them to invest in the stock market. Another of Brian William's questions brought an unexpected burst of applause by the all- Republican audience even before Perry had had a chance to answer it. Williams asked how he could sleep at night knowing his state had applied the death penalty to 234 convicts, the highest rate in the nation, and some of whom were perhaps innocent. Perry said the crimes they had perpetrated deserved it, and that yes, he slept fine at night knowing that the appeals process was thorough and fair. Of course, people are entitled to their views on the death penalty, and quotes from the Bible have been used to justify it. But it is sad and even incongruous to see a purportedly well educated middle class audience of a purportedly Christian nation cheer the notion. Patti Davis, President Reagan's daughter, later said to an interviewer it was almost" blasphemous" to celebrate the death penalty at the Reagan library, given the fact that her father had approached the issue with a heavy heart and burden to his conscience, albeit accepting it as a necessary evil. Mitt Romney appeared poised, fluent on the economy and self confident. It may help him knowing that he has 250 billion dollars in his own personal account, and that he has outpaced all other candidates so far in fundraising. He seems to be the choice of the business elite and of urban and suburban Republicans (60% of his donors come from big cities and their surroundings). On the other hand, Perry's supporters say that through his ten years as governor of Texas, Perry has laid the groundwork to raise all the money he might need for a national election. He has a donor network that can "bundle" millions. Texas places no limits on how much donors can give to political campaigns, even as federal law limits donations to the derisory amount of $2,500 per person. Still, some critics say Perry would need to capture a broader donor base to compete in a national election. Michelle Bachman's adventure into the Republican primary may be coming to an end as her star fades and Tea Partiers and Evangelicals transfer their support to Rick Perry. Her campaign is in disarray over fundraising and strategy. Ed Rollins, a veteran GOP operative who managed Reagan's 1984 campaign, resigned as her advisor after Bachman could not be persuaded to focus on campaigning in Iowa only (where the first primary caucus will take place and where she won a straw poll a few weeks ago), instead of trying to run a national campaign. She hasn't been able to raise enough money outside Iowa and that limits her campaign's choices. Perry has taken her thunder. It doesn't help that the Congress woman keeps repeating her Manichean views on every single issue, insisting for example again during this debate, that it was wrong for the US to intervene in Libya because there was no national interest involved in the region, a position that nobody in the GOP establishment shares, especially now that Qaddafi is all but defeated.On Thursday, after two changes in schedule were forced on the White House (one due to the GOP debate on Wednesday, the other due to the opening of the NFL season shown at prime time on Thursday night), President Obama delivered his much awaited jobs creation speech. He unveiled a $ 447 billion plan, a mixture of tax cuts and new spending programs. It includes extending cuts in payroll taxes to individuals and employers, new infrastructure spending, a new mortgage refinancing program, retraining for the unemployed and tax credits to businesses that employ those who have been out of a job for over six moths. He also talked about a private-public infrastructure bank and emphasized that all this new spending would be coupled with more cuts in the deficit later. This was an attempt at a new marketing of the President's measures to stimulate the economy: he was more specific, more conciliatory and avoided using the word "stimulus" that has gotten so much bad press since most people think the initial package did not help the economy one bit.The President spoke with new confidence and conviction; he sounded re-energized and optimistic, and evoked in the public memories of "Obama the candidate". The next morning he was on the road to sell his plan to voters first in Virginia, speaking to 9,000 people gathered at the University of Richmond. Virginia, Ohio and North Carolina are the three states the President strategically chose to visit. Obama won all three in the 2008 election but they each voted Republicans to their legislatures in last year's mid-term elections. The Republican response in Congress was cautiously positive. Indeed, even as Obama's numbers in the polls continue to drop (44% approval rate of his person, with 59% disapproving of his handling of the economy, is the latest), approval of Congress is at an all time low of 13%. A change is tone has registered as Republicans realize that their do-nothing strategy has gone too far and it is time to stop playing the political game and address economic recovery in earnest. It is indeed refreshing, after the acerbic debt ceiling fights, to hear House majority leader Eric Cantor say it's time to build consensus and work together. Their brinkmanship has infuriated their constituents and put at risk all the gains made in last year's mid-term elections.It remains to be seen whether the electorate's disgust with excessive conflict and confrontation within the DC belt also extends to the presidential primary. Will voters choose the bold and aggressive governor from Texas who better reflects their anger with his provocative language (he wants to cut the "head off the snake" (meaning the federal government's interference with states policies), or the cooler, more cerebral, more conciliatory (indeed, in some ways, more Obama-like) candidate from Massachusetts that wants moderation and speaks to the middle class? In this head-to-head contest between Perry and Romney, one can assume people will ultimately choose the one they see can solve their problems, end the paralysis and get the country moving again. But the country's social fabric is torn by unemployment, anger and frustration with government and hopelessness about the future. As the more aggressive candidate, Perry may well be the one that embodies the spirit of the times.In his first national appearance, the Texan did not make any major mistakes. He has dislodged Romney from top in national polls, but not in New Hampshire, where Romney still leads by a wide margin. From now on, the calendar will drive the candidates' strategies. If Perry wins Iowa and Romney New Hampshire, it will definitely become a two person race going forward into South Carolina, where Baptists most likely will choose a Texan Evangelist over a New Englander Mormon. That might interrupt Romney's momentum. Then comes Florida, where there is a big number of Tea Partiers and an even larger number of retirees. The vote of these two groups will be decisive. Perry could lose the retirees on his Social Security attacks, which were mainly addressed to young voters who don't vote in primaries. But there is plenty of time to adjust his views and rectify his blunders so as to become more electable.Cocky, dark and handsome, a cross between Johnny Cash and John Wayne, Perry has a formidable presence that makes a good impression on voters. Blunt and direct in his speech, with a distinct Southern accent, his peculiar kind of charisma compensates for his lack of polish. He is tough and rugged, doesn't back down, and appeared solid in his philosophy of "detax, deregulate and delitigate". He is clearly the candidate that can win the Mid-West and the Deep South. The question is whether he will withstand the deeper scrutiny of a presidential race he entered late, and whether he can refine his arguments and still be reassuring. Romney still appears as the more electable candidate in a national election and the one that can more easily confront Obama. But he has two main weak points: his religion (he is a Mormon, a religion that has a bad name among other Christian denominations) and the Massachusetts health care law he signed when he was governor, that his rivals claim is a replica of what they disdainfully call "Obamacare", which all candidates, including Romney, have avowed to repeal as soon as they get to the White House. Will the race become a two-man contest from this point on? Americans should not hold their breath; there is still talk about new candidates entering the race: Sarah Palin and Rudy Giuliani seem to be waiting on the sidelines, ready to jump into the race at any time if prompted to do so by the polls or by the GOP establishment. The current survivors may still be challenged by others with more staying power and reality show experience.Senior Lecturer, Department of Political Science and Geography Director, ODU Model United Nations Program Old Dominion University, Norfolk, Virginia

The lessons learned from the implications of the global crisis for the Armenian economy led the Government of Armenia to refine its approach to economic development policy. The business environment, the market structure, and the incentive pattern had not fostered reallocation of resources into more productive areas or the emergence of internationally competitive products and services. Despite numerous initiatives and multiple efforts, there was no holistic approach or actionable roadmap for supporting private sector development. The pressing need to restore economic growth despite a small domestic market led the Armenian government to search for new sources of growth in export-oriented industries. At the end of 2011, the Government of Armenia adopted its export-led industrial development strategy. The strategy set as targets improving the general business environment and sector-specific initiatives to address market failures and expand exports. The strategy builds on both a general (crosscutting) and an industry-customized toolset.

Myanmar is going through a critical transformation in its development path - from isolation and fragmentation to openness and integration; and from pervasive state control, exclusion, and individual disengagement, to inclusion, participation, and empowerment. This dual shift is happening against a backdrop of broader political reforms that started in 2011 when a new administration took office. The country's transition after the planned elections in 2015 will be a major test of the progress on political reforms. There remain risks of political instability, policy discontinuity, and stalled reforms due to vested interests.

Doing business sheds light on how easy or difficult it is for a local entrepreneur to open and run a small to medium-size business when complying with relevant regulations. It measures and tracks changes in regulations affecting 10 areas in the life cycle of a business: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. In a series of annual reports doing business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 183 economies, from Afghanistan to Zimbabwe, over time. This economy profile presents the doing business indicators for Nigeria. To allow useful comparison, it also provides data for other selected economies (comparator economies) for each indicator. The data in this report are current as of June 1, 2011 (except for the paying taxes indicators, which cover the period January-December 2010).

This tenth edition of Doing Business sheds light on how easy or difficult it is for a local entrepreneur to open and run a small to medium-size business when complying with relevant regulations. It measures and tracks changes in regulations affecting eleven areas in the life cycle of a business: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts, resolving insolvency and employing workers. Doing Business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 185 economies, from Afghanistan to Zimbabwe, over time. The indicators are used to analyze economic outcomes and identify what reforms have worked, where and why. This economy profile presents the Doing Business indicators for Indonesia. To allow useful comparison, it also provides data for other selected economies (comparator economies) for each indicator. The data in this report are current as of June 1, 2012 (except for the paying taxes indicators, which cover the period January - December 2011).

This tenth edition of Doing Business sheds light on how easy or difficult it is for a local entrepreneur to open and run a small to medium-size business when complying with relevant regulations. It measures and tracks changes in regulations affecting eleven areas in the life cycle of a business: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts, resolving insolvency and employing workers. Doing Business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 185 economies, from Afghanistan to Zimbabwe, over time. The indicators are used to analyze economic outcomes and identify what reforms have worked, where and why. This economy profile presents the Doing Business indicators for Nigeria. To allow useful comparison, it also provides data for other selected economies (comparator economies) for each indicator. The data in this report are current as of June 1, 2012 (except for the paying taxes indicators, which cover the period January - December 2011).

Doing business sheds light on how easy or difficult it is for a local entrepreneur to open and run a small to medium-size business when complying with relevant regulations. It measures and tracks changes in regulations affecting 10 areas in the life cycle of a business: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. In a series of annual reports doing business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 183 economies, from Afghanistan to Zimbabwe, over time. This economy profile presents the doing business indicators for Montenegro. To allow useful comparison, it also provides data for other selected economies (comparator economies) for each indicator. The data in this report are current as of June 1, 2011 (except for the paying taxes indicators, which cover the period January December 2010).

Doing business sheds light on how easy or difficult it is for a local entrepreneur to open and run a small to medium-size business when complying with relevant regulations. It measures and tracks changes in regulations affecting 10 areas in the life cycle of a business: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. In a series of annual reports doing business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 183 economies, from Afghanistan to Zimbabwe, over time. This regional profile presents the doing business indicators for Economic Community of Central African States (ECCAS). To allow useful comparison, it also provides data for other selected economies (comparator economies) for each indicator. The data in this report are current as of June 1, 2011 (except for the paying taxes indicators, which cover the period January-December 2010).

Collected data and research material presented in the monograph are a result of financing of the Polish science budget in the years 2011−14; the research project was financed by the National Science Centre according to decision no. DEC-2011/01/B/HS4/04744. The project that resulted in this monograph was financed from public funds for education for 2011 − 2014, the National Science Center under Contract No. DEC-2011/01/B/HS4/04744. ; Value-Based Working Capital Management analyzes the causes and effects of improper cash flow management between entrepreneurial organizations with varying levels of risk. This work looks at the motives and criteria for decision-making by entrepreneurs in their efforts to protect the financial security of their businesses and manage financial liquidity. Michalski argues that businesses exposed to greater risk need a different approach to managing liquidity levels. The scientific aim of this monograph is to present the essence of financial liquidity management under specific conditions faced by enterprises with risk and uncertainty. Enterprises differ from one another in risk sensitivity. This difference affects the area of taking decisions by the managers of those enterprises. The result of interactions between levels of liquidity and sensitivity to risk affects the managers of such enterprises (Altman 1984; Tobin 1958; Back 2001; Tobin 1969). In this monograph the research hypothesis is the claim that enterprises with a higher sensitivity to risk are very different from enterprises with a lower sensitivity to risk, resulting in a different approach to managing their working capital. Enterprise managing teams react to risk, and this reaction is adjusted by an enterprise's sensitivity to risk. Because of its subject area, the book will address the issues of corporate finance. The monograph discusses the behavior of enterprises and the relationships between them and other factors in the market occurring in the management process under the conditions of limited resources. As a result of these interactions with the market and the environment in which individuals who manage enterprises operate, there is an interaction between money and real processes that in the end are the cornerstone of wealth building. This chapter discusses the objectives and nature of enterprises in the context of their risk sensitivity, as well as the relationships between the objectives of enterprises and the characteristic features of their businesses. Enterprises operate in various business environments, but generally speaking, they all have one main aim: wealth creation for their owners. The realization of that aim depends on an idea of business in which the enterprise is an instrument to collect money from clients of the enterprise's services and products. Business environment is crucial not only for future enterprise cash inflows from the market but also for risk and uncertainty (Asch, and Kaye 1997; Copeland, and Weston 1988; Fazzari, and Petersen 1993). According to the author, it is necessary to include an understanding of that risk and uncertainty of future in the rate that reduces the net size of free cash flows for the enterprise owners, beneficiaries, or more generally stakeholders. Enterprise value creation is the main financial aim of the firm in relation to working capital components (Graber 1948; Jensen, and Meckling 1976; Lazaridis, and Trifonidis 2006). Working capital management is a part of a general enterprise strategy to its value maximization (Laffer 1970; Kieschnick, Laplante, and Moussawi 2009; Lyland, and Pyle 1977). This chapter presents a definition of financial liquidity and liquidity-level measurements. This chapter contains four subchapters that address the specific role of short-term financial decisions, a classification of definitions of financial liquidity, sources of information about liquidity level, and liquidity-level measurements (Lazaridis and Tryfonidis 2006; Long, Malitz, and Ravid 1993; Kieschnick, Laplante, and Moussawi 2009). Financial liquidity definition and liquidity-level measurements Here we have an opportunity to present the author's opinion on what assets should be financed with short-term funds and what the level of liquidity is in an enterprise (Michalski 2012a). The discussion also pertains to the issue of the dividing line between long-term and short-term decisions, with greater emphasis on the durability of their effects, rather than the decision-making speed. This section also attempts to answer the question: What are the short-term effects of operations under conditions of uncertainty and risk? The reason for the considerations in this section is the need to characterize the decisions that affect the level of enterprise liquidity. The research hypothesis of this monograph assumes that differences between more risk sensitive and less risk sensitive enterprises are seen in liquidity management. Simply because the enterprises, during financial liquidity management, take into account the differences in their risk sensitivity. This chapter discusses the relationship between firm value and business risk sensitivity. The chapter starts with a presentation of intrinsic liquidity value and firm reactions to market liquidity value. This is the basis for target liquidity level in the enterprise. Liquid assets are the main part of working capital assets, so the next part of the chapter focuses on working capital investment strategies and strategies of financing such investments in working capital in the context of firm value creation. The chapter concludes that, from a firm-value-creation point of view, more risk-sensitive entities should use flexible-conservative strategies, while less risk-sensitive entities have the freedom to use restrictive-aggressive strategies. In the context of a crisis, this is the clear answer and explanation for higher levels of working capital investments observed empirically during and after a crisis. The determinants of intrinsic value of liquidity are attributed to liquidity by enterprise management. Enterprises in which financial liquidity has a high internal value will have a tendency to maintain reasonable liquid resource assets at a higher level. The levels of stocks of funds maintained by enterprises are also the result of the relationship between the liquidity market value and the intrinsic value of liquidity. It demonstrates how to approach the estimation of liquidity and presents the market value of liquidity. Having connected this information with the knowledge of manifestations of the internal liquidity, we can offer an explanation as to why the target (and also probably the optimal) level of liquidity for enterprises with higher-than-average risk sensitivity is at a higher level than the corresponding target (optimal) level for enterprises with a lower level of risk sensitivity. Working capital value-based management models In this part of the monograph we discuss the items contained within the cost of maintaining inventory. Using this approach, a model of managing inventories is presented. Theoretically, the value-maximizing optimal level of inventory is determined to be the modified EOQ model, presented as VBEOQ model. We also present an outline of issues associated with the risk of inventory management and its impact on the value of the enterprise for its owner. We also discuss the principle of the optimal batch production model and how the size of the production batch affects the value of the enterprise for its owner. Here also is demonstrated a modification of the POQ model: VBPOQ. The proposed modification takes into account the rate of the cost of capital financing and the measures involved in inventory when determining the optimal batch production. When managing the commitment of the inventory, it is crucial to take into account the impact of such decisions on the long-term effectiveness of the enterprise. This chapter also discusses the relationships between the management of accounts receivables and the value of a business. A modified (considering the value of a business) model of incremental analysis of receivables is presented, as is a discussion of the importance of capacity utilization by an enterprise for making management decisions pertaining to accounts receivables. Issues related to the management of working capital and enterprise liquidity are and will be an area of research. The analysis in this study focused primarily on working capital and liquidity management; understanding its specifics will facilitate the management of liquidity in any type of organization. Working capital as a specific buffer against risk has its special role during a crisis and can serve as a good forecasting indicator about future economic problems in the economy if a whole business environment notices higher levels of working capital and its components, like cash, inventories, and accounts receivables. The scientific value of the issues discussed in the book is associated with the issue of working capital and liquidity management in enterprises. It is also a result of the exploration and definition of the main financial objective of businesses and the relationship between the objective and the management of working capital and enterprise liquidity. The choice of topic and the contents of research resulted also from empirical observation. Empirical data on enterprises that operate in countries touched by the last crisis document higher-than-average levels of working capital before, during, and after the crisis in these enterprises. These conditions provided the means for a "natural experiment" of sorts. From that point, working capital management theory faced a necessity of even wider development. ; Collected data and research material presented in the monograph are a result of financing of the Polish science budget in the years 2011−14; the research project was financed by the National Science Centre according to decision no. DEC-2011/01/B/HS4/04744. The project that resulted in this monograph was financed from public funds for education for 2011 − 2014, the National Science Center under Contract No. DEC-2011/01/B/HS4/04744. ; How to Cite this Book Harvard Grzegorz Michalski . (April 2014). Value-Based Working Capital Management . [Online] Available at: http://www.palgraveconnect.com/pc/doifinder/10.1057/9781137391834. (Accessed: 28 May 2014). APA Grzegorz Michalski . (April 2014). Value-Based Working Capital Management . Retrieved from http://www.palgraveconnect.com/pc/doifinder/10.1057/9781137391834 MLA Grzegorz Michalski . Value-Based Working Capital Management . (April 2014) Palgrave Macmillan. 28 May 2014. Vancouver Grzegorz Michalski . Value-Based Working Capital Management [internet]. New York: Palgrave Macmillan; April 2014. [cited 2014 May 28]. Available from: http://www.palgraveconnect.com/pc/doifinder/10.1057/9781137391834 OSCOLA Grzegorz Michalski , Value-Based Working Capital Management , Palgrave Macmillan April 2014 ; Author Biography Grzegorz Michalski is Assistant Professor of Corporate Finance at the Wroclaw University of Economics, Poland. His main areas of research are Business Finance and Financial Liquidity Management. He is currently studying the liquidity decisions made by organizations. He is the author or co-author of over 80 papers and 10 books, and sits on the editorial board of international conferences and journals. Reviews 'Due to the recent financial crisis, interest in the topic of working capital has grown significantly to both theory and practice. The research results presented by Grzegorz Michalski contribute to the development of a comprehensive theory of liquidity management and the creation of an integrated working capital and liquidity for different types of business model. The job is processed on a high quality level." -Marek Panfil, Ph.D, Director of Business Valuation Department Warsaw School of Economics 'The book of Grzegorz Michalski is a very good publication that has found the right balance between theory and practical aspects of financial liquidity management. It is extremely timely and valuable, and should be required reading for all corporate finance practitioners, academicians, and students of finance. Value-Based Working Capital Management is comprehensive, highly readable publication, and replete with useful practical examples. It has also enabled corporate leaders to make better-informed decisions in their efforts to protect the financial security of their businesses and manage financial liquidity.' -Petr Polak, Author of Centralization of Treasury Management, and Associate Professor of Finance, University of Brunei Darussalam ; REFERENCES Introduction Adner, R., and D. A. Levinthal (2004). "What Is Not a Real Option: Considering Boundaries for the Application of Real Options to Business Strategy." Academy of Management Review 29(1). Altman, E. (1984). "A Further Empirical Investigation of the Bankruptcy Cost Question." Journal of Finance 39. Back, P. (2001). "Testing Liquidity Measures as Bankruptcy Prediction Variables." Liiketaloudellinen Aikakauskirja—The Finnish Journal of Business Economics 2001(3). Baker, M., and J. Wurgler (2002). "Market Timing and Capital Structure." Journal of Finance 57. Ben-Horim, M., and H. Levy (1982). "Inflation and the Trade Credit Theory Period." Management Science 28(6), pp. 646–51. Blaug, M. (1985). Economic Theory in Retrospect. Cambridge University Press: Cambridge. Charnes, A., W. Cooper, and E. Rhodes (1978). "Measuring the Efficiency of Decision Making Units." European Journal of Operational Research 2. Cokins, G. (2004). Performance Management: Finding the Missing Pieces to Close the Intelligence Gap. John Wiley & Sons: Hoboken, NJ. Dluhosova, D. (2006). Financial management of firms (in Czech: Financni rizeni a rozhodovani podniku). Ekopress: Prague. Emery, G. W. (1987). "An Optimal Financial Approach to Variable Demand." Journal of Financial and Quantitative Analysis 22(2), pp. 209–25. Falope, O. I., and O. T. Ajilore (2009). "Working Capital Management and Corporate Profitability: Evidence from Panel Data Analysis of Selected Quoted Companies in Nigeria." Research Journal of Business Management 3, pp. 73–84. Hill, M. D., G. W. Kelly, and M. J. Highfield (2010). "Net Operating Working Capital Behavior: A First Look." Financial Management 39(2), pp. 783–805. Hirshleifer, J. (1958). "On the Theory of the Optimal Investment Decision." Journal of Political Economy 66. Huyghebaert, N. (2006). "On the Determinants and Dynamics of Trade Credit Use: Empirical Evidence from Business Start-Ups." Journal of Business Finance & Accounting 33(1). Ijiri, Y. (1978). "Cash-Flow Accounting and Its Structure." Journal of Accounting, Auditing and Finance 1(4). Kaura, M. (2002). Management Control and Reporting Systems: Harmonising Design and Implementation. SAGE Publications, Response Books: New Delhi. Khoury, N., K. Smith, and P. MacKay (1999). "Comparing Current Assets Practices in Canada, the United States and Australia." Revue Canadienne des Sciences de l'Administration 16(1), pp. 53–57. Lumby, S. (1993). Investment Appraisal and Financing Decisions. The Chapman & Hall Series in Accounting and Finance. Routledge Chapman & Hall: London. Mallik, A.K., and D. Sur (1998). "Working Capital and Profitability: A Case Study in Interrelation." The Management Accountant 33(11), pp. 805–9. Mallik, A.K., D. Sur, and D. Rakshit (2005). "Working Capital and Profitability: A Study on Their Relationship with Reference to Selected Companies in Indian Pharmaceutical Industry." GITAM Journal of Management 3, pp. 51–62. Markides, C. (1997). "Strategic Innovation." MIT Sloan Management Review 39(3). Masulis, R. (1980). "The Impact of Capital Structure Change on Firm Value: Some Estimates." Journal of Finance 38(1). Myers, S. (1984). "The Capital Structure Puzzle." Journal of Finance 39(3), Available at MIT: http://dspace.mit.edu/bitstream/handle/1721.1/2078/SWP-1548-15376697.pdf (date of access: January 10, 2014). Myers, S., and N. Majluf (1984). "Corporate Financing and Investment Decisions When Firms Have Information Investors Do Not Have." Journal of Financial Economics 13(2) Available at MIT: http://dspace.mit.edu/bitstream/handle/1721.1/2068/SWP-1523-15376412.pdf (date of access: January 10, 2014). Myers, S. C. (1984). "The Capital Structure Puzzle." Journal of Finance 3. Peel, M. J., N. Wilson, and C. Howorth (2000). "Late Payment and Credit Management in the Small Firm Sector: Some Empirical Evidence." International Journal of Small Business 18(2). Petersen, M. A., and R. G. Rajan (1997). "Trade Credit: Theories and Evidence." The Review of Financial Studies 10(3), pp. 661–91. Pike, R., and B. Neale (1999). Corporate Finance and Investment: Decisions and Strategies. Prentice Hall: London. Pratt, S., and A. Niculita (2008). Valuing a Business: The Analysis and Appraisal of Closely Held Companies. McGraw-Hill: New York. Preve, L. A., and V. Sarria-Allende (2010). Working Capital Management, Financial Management Association Survey and Synthesis Series. Oxford University Press: New York. Robichek, A. A. (1975). "Interpreting the Results of Risk Analysis." Journal of Finance 30(5), pp. 1384–86. Ruback, S. C. (2002). "Capital Cash Flows: A Simple Approach to Valuing Risky Cash Flows." Financial Management 31(2). Scherr, F. C. (1989). Modern Working Capital Management. Text and Cases. Prentice Hall: Englewood Cliffs, NJ. Smith, J. E., and K. F. McCardle (1998). "Valuing Oil Properties: Integrating Option Pricing and Decision Analysis Approaches." Operations Research 46(2). Soltes, V. (2012). "Paradigms of Changes in the 21st Century: Quest for Configurations in Mosaic." Ekonomicky Casopis 60(4). Soufani, K. (2002). "On the Determinants of Factoring as a Financing Choice: Evidence from the UK." Journal of Economics and Business 54. Stewart, G. (1991). The Quest for Value. HarperCollins: New York. Summers, B., and N. Wilson (2000). "Trade Credit Management and the Decision to Use Factoring: An Empirical Study." Journal of Business Finance & Accounting 27(1). Tobin, J. (1958). "Liquidity Preference as Behavior Towards Risk." Review of Economic Studies 67, pp. 65–86. Tobin, J. (1969). "A General Equilibrium Approach to Monetary Theory." Journal of Money Credit and Banking 1(1). Washam, J., and D. Davis (1998). "Evaluating Corporate Liquidity." TMA Journal 18(2). Williamson, O. (1988). "Corporate Finance and Corporate Governance." Journal of Finance 43(3). Wilner, B. (2000). "The Exploitation of Relationships in Financial Distress: The Case of Trade Credit." Journal of Finance 55, pp. 153–78. Wojciechowska, U. (2001). Liquidity of Polish companies in transition economy: Microeconomic and macroeconomic aspects (in Polish: Plynnosc finansowa polskich przedsiebiorstw w okresie transformacji gospodarki). SGH: Warsaw. Zardkoohi, A. (2004). "Do Real Options Lead to Escalation of Commitment?" Academy of Management Science 29(1). Zmeskal, Z., and D. Dluhosova (2009). "Company Financial Performance Prediction on Economic Value Added Measure by Simulation Methodology." Proceedings of the 27th International Conference on Mathematical Methods in Economics, Mathematical Methods in Economics; H. Brožová, R. Kvasnička eds., Czech University of Life Sciences, Chapter 1. Working Capital Management in the Business Context Adner, R., and D. A. Levinthal (2004). "What Is Not a Real Option: Considering Boundaries for the Application of Real Options to Business Strategy." Academy of Management Review 29(1). Amram, M., and N. Kulatilaka (1999). Real Options: Managing Strategic Investment in an Uncertain World. Harvard Business School Press: Boston. Asch, D., and G. R. Kaye (1997). Financial Planning: Profit Improvement through Modelling. Kogan Page: London. Bagchi, B. and B. Khamrui (2012). "Relationship between Working Capital Management and Profitability: A Study of Selected FMCG Companies in India." Business and Economics Journal 60. Banos-Caballero, S., P. J. García-Teruel, and P. Martinez-Solano (2010). "Working Capital Management in Enterprises." Accounting & Finance 50(3), pp. 511–27. Baxter, M., and A. Rennie (1996). Financial Calculus: An Introduction to Derivative Pricing. Cambridge University Press: Cambridge. Baz, J., and G. Chacko (2004). Financial Derivatives: Pricing, Applications and Mathematics. Cambridge University Press: Cambridge. Beck, P. E., and D. R. Stockman (2005). "Money as Real Options in a Cash-in-Advance Economy." Economics Letters 87. Ben-Horim, M., and H. Levy (1982). "Inflation and the Trade Credit Theory Period." Management Science 28(6), pp. 646–51. Berger, P. G., E. Ofek, and I. Swary (1996). "Investor Valuation of the Abandonment Option." Journal of Financial Economics 42(2). Black, F., and M. Scholes (1973). "The Pricing of Options and Corporate Liabilities." Journal of Political Economy 81. Brasch, J. J. (1972). "The Role of Trade Credit in Economic Development." Nebraska Journal of Economics and Business 11(1), pp. 63–67. Brealey, R. A., and S. C. Myers (1999). Basics of enterprises finance (Polish edition: Podstawy finansow przedsiebiorstw). WN PWN: Warszawa. Brennan, M. J., and E. S. Schwartz (1985). "Evaluating Natural Resource Investments." Journal of Business 58(2). Cassimon, D., and P. J. Engelen (2003). "The New Frontiers of Corporate Finance." Global Business Review 5(1). Cokins, G. (2004). Performance Management: Finding the Missing Pieces to Close the Intelligence Gap. John Wiley & Sons: Hoboken, NJ. Copeland, T. E., and V. Antikarov (2001). Real Options: A Practitioner's Guide. Business & Economics: Texere, London, New York. Copeland, T. E., and P. Keenan (1998). "How Much Is Flexibility Worth?" The McKinsey Quarterly 2. Copeland, T. E., and J. Weston (1988). Financial Theory and Corporate Policy. Addison-Wesley: Reading, MA. Copeland, T. E., and J. F. Weston (1982). "A Note on the Evaluation of Cancellable Operating Leases." Financial Management 11. Copeland, T. E., L. F. Weston, and K. Shastri (2004). Financial Theory and Corporate Policy. Addison-WesleyPublishing Company: Boston. Cote, J. M., and C. K. Latham (1999). "The Merchandising Ratio: A Comprehensive Measure of Current Assets Strategy." Issues in Accounting Education 14(2) May, pp. 255–67. Database Amadeus product of Bureau van Dijk (date of release: 2013 SEP 15). Dluhosova, D. (2006). Financial management of firms (in Czech: Financni rizeni a rozhodovani podniku). Ekopress: Prague. Dudycz, T. (2000). Financial analysis (in Polish: Analiza finansowa). AE: Wroclaw. Emery, G. W. (1987). "An Optimal Financial Approach to Variable Demand." Journal of Financial and Quantitative Analysis 22(2), pp. 209–25. Fabozzi, F. J. (1999). Investment Management. Prentice Hall: Upper Saddle River, NJ. Falope, O. I., and O. T. Ajilore (2009). "Working Capital Management and Corporate Profitability: Evidence from Panel Data Analysis of Selected Quoted Companies in Nigeria." Research Journal of Business Management 3, pp. 73–84. Fazzari, S.M., and B. C. Petersen (1993). "Working Capital and Fixed Investment: New Evidence on Financing Constraints." The RAND Journal of Economics 24, pp. 328–42. Fernandez, P. (2002). Valuation Methods and Shareholder Value Creation. Academic Press/Elsevier: San Diego. Fewings, D. R. (1996). "Unbiased Trade Credit Decisions under Imperfect Information." Advances in Working Capital Management 3. Gentry, J. A. (1988). "State of the Art of Short-Run Financial Management." Financial Management 17(2), pp. 41–57. Graber, P. J. (1948). "Assets." The Accounting Review 23(1), pp. 12–16. Graham, J. (1996). "Debt and the Marginal Tax Rate." Jounal of Financial Economics 41(1). Graham, J., and C. Harvey (2001). "The Theory and Practice of Corporate Finance: Evidence from the Field." Journal of Financial Economics 60(2−3). Harris, M., and A. Raviv (1988). "Corporate Control Contents and Capital Structure." Journal of Financial Economics 20. Harris, M., and A. Raviv (1991). "The Theory of Capital Structure." Journal of Finance 46(1). Henderson, J. W., and T. S. Maness (1989). The Financial Analyst's Deskbook: A Cash Flow Approach to Liquidity. Van Nostrand Reinhold: New York. Hsia, C. (1981). "Coherence of the Modern Theories of Finance." Financial Management 10(4). Jain, N. (2001). "Monitoring Costs and Trade Credit." The Quarterly of Economics and Finance 41, pp. 89–110. Jensen, M. (1986). "Agency Cost of Free-Cash-Flow, Corporate Finance, and Takeovers." American Economic Review 76(2). Jensen, M. C., and W. H. Meckling (1976). "Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure." Journal of Financial Economics 3(4). Kieschnick, R. L., M. Laplante, and R. Moussawi (2009). "Working Capital Management, Access to Financing, and Firm Value" Working Paper. Available at SSRN: http://ssrn.com/abstract = 1431165 (date of access: December 10, 2010). » Link Laffer, A. B. (1970). "Trade Credit and the Money Market." Journal of Political Economy (March/April), pp. 239–67. Lazaridis, I., and D. Tryfonidis (2006). "Relationship between Working Capital Management and Profitability of Listed Companies in the Athens Stock Exchange." Journal of Financial Management and Analysis 19(1), January-June. Available at SSRN: http://ssrn.com/abstract = 931591 (date of access: January 10, 2014). Lee, C. F., and J. E. Finnerty (1990). Corporate Finance: Theory, Method and Applications. HBJ: Orlando, FL. Levy, H., and D. Gunthorpe (1999). Introduction to Investments. South-Western College Publishing: Cincinnati, OH. Lyland, H., and D. Pyle (1977). "Information Asymmetries, Financial Structure and Financial Intermediation." Journal of Finance 32(2). Marr, B. (2006). Strategic Performance Management: Leveraging and Measuring Your Intangible Value Drivers. Butterworth-Heinemann: London. Martin, J. D., J. W. Petty, A. J. Keown, and D. F. Scott (1991). Basic Financial Management. Prentice Hall: Englewood Cliffs, NJ. Meszek, W., and M. Polewski (2006). "Certain Aspects of Working Capital in a Construction Company." Technological and Economic Development of Economy 12(3),pp. 222–26. Mian, S. L., and C. W. Smith (1992). "Accounts Receivable Management Policy: Theory and Evidence." Journal of Finance 67(1). Michalski, G. (2008). "Value-Based Inventory Management." Journal of Economic Forecasting 9(1), pp. 82–90. Michalski, G. (2009). "Effectiveness of Investment in Operating Cash." Journal of Corporate Treasury Management 3(1). Michalski, G. (2010). Strategic management of liquidity in enterprises. (in Polish: Strategiczne zarzadzanie plynnoscia finansowa w przedsiebiorstwie). CeDeWu: Warsaw. Michalski, G. (2012a). "Crisis-Caused Changes in Intrinsic Liquidity Value in Non-Profit Institutions. Equilibrium." Quarterly Journal of Economics and Economic Policy 7(2). Michalski, G. (2012b). "Crisis Influence on General Economic Condition and Corporate Liquidity Management: Financial Liquidity Investment Efficiency Model (FLIEM) Use to Diagnose Polish Economics Standing." Proceedings of the 7th International Conference on Currency, Banking and International Finance: How Does Central and Eastern Europe Cope with the Global Financial Crisis? EKONOM: Bratislava, pp. 200–219. Michalski, G. (2012c). "Financial Liquidity Management in Relation to Risk Sensitivity: Polish Firms Case." Proceedings of the International Conference Quantitative Methods in Economics (Multiple Criteria Decision Making XVI). EKONOM: Bratislava, pp. 141–60. Michalski, G. (2012d). "Risk Sensitivity Indicator as Correction Factor for Cost of Capital Rate." Managing and Modelling of Financial Risks: 6th International Scientific Conference Proceedings. Vysoka Skola Banska VSB-TU, Faculty of Economics, Finance Department, Ostrava, pp. 418–28, Available at SSRN: http://ssrn.com/abstract = 2193398 (date of access: January 10, 2014). » Link Miles, J. A., and J. R. Ezzell (1980). "The Weighted Average Cost of Capital, Perfect Capital Markets, and Project Life." Journal of Financial and Quantitative Analysis 15(3). Miller, M. (1999). Merton Miller o instrumentach pochodnych. K. E. Liber: Warszawa. Miller, M., and F. Modigliani (1961). "Dividend Policy, Growth, and the Valuation of Shares." Journal of Business 34(4). Miller, M., and F. Modigliani (1966). "Some Estimates of the Cost of Capital to the Electric Utility Industry, 1954 − 57." American Economic Review 56(3). Modigliani, F. (1982). "Debt, Dividend Policy, Taxes, Inflation and Market Valuation." Journal of Finance 37(2). Modigliani, F., and M. Miller (1958). "The Cost of Capital, Corporation Finance and the Theory of Investment." American Economic Review 48(3). Modigliani, F., and M. Miller (1963). "Taxes and the Cost of Capital: A Correction." American Economic Review 53(3). Moyer, R. C., J. R. McGuigan, and W. J. Ketlow (1990). Contemporary Financial Management. West Publishing Company: Saint Paul. Mueller, F. (1953). "Corporate Current Assets and Liquidity." The Journal of Business of the University of Chicago 26(3), pp. 157–72. Myers, S. (1977). "The Determinants of Corporate Borrowing." Journal of Financial Economics 5(2) Available at MIT: http://dspace.mit.edu/bitstream/handle/1721.1/1915/SWP-0875-02570768.pdf (date of access: January 10, 2014). Myers, S. (1984). "The Capital Structure Puzzle." Journal of Finance 39(3), Available at MIT: http://dspace.mit.edu/bitstream/handle/1721.1/2078/SWP-1548-15376697.pdf (date of access: January 10, 2014). Myers, S. (1998). "The Search of Capital Structure Puzzle." In Financial Strategy: Adding Shareholder Value. Edited by J. Rutterford. John Wiley & Sons: Chichester. Myers, S., and N. Majluf (1984). "Corporate Financing and Investment Decisions When Firms Have Information Investors Do Not Have." Journal of Financial Economics 13(2) Available at MIT: http://dspace.mit.edu/bitstream/handle/1721.1/2068/SWP-1523-15376412.pdf (date of access: January 10, 2014). Myers, S. C. (1974). "Interactions of Corporate Finance and Investment Decisions: Implications for Capital Budgeting." Journal of Finance 29(1) Available at JSTOR: http://www.jstor.org/discover/10.2307/2978211 (date of access: January 10, 2014). Myers, S. C. (1977). "Determinants of Corporate Borrowing." Journal of Financial Economics 5. Myers, S. C. (2001). "Finance Theory and Financial Strategy." In Real Options and Investment under Uncertainty. Edited by E. S. Schwartz and L. Trigeorgis. MIT Press: Cambridge, MA. Myers, S. C. (1984). "The Capital Structure Puzzle." Journal of Finance 3. Myers, S. C., and S. M. Turnbull (1977). "Capital Budgeting and the Capital Asset Pricing Model: Good News and Bad News." Journal of Finance 32(2), pp. 321–33. Nadiri, M. I. (1969). "The Determinants of Trade Credit in the US Total Manufacturing Sector." Econometrica 37(3). Narware, P. C. (2004). "Working Capital and Profitability: An Empirical Analysis."; The Management Accountant, ICWAI Knowledge Bank, Kolkatta, June, pp. 491−493. Nobanee, H. (2009). "Working Capital Management and Firm's Profitability: An Optimal Cash Conversion Cycle." Working Paper. Available at SSRN: http://ssrn.com/abstract=1471230 or http://dx.doi.org/10.2139/ssrn.1471230 (date of access: January 10, 2014). » Link Nobanee, H., W. K. Al Shattarat, and A. E. Haddad (2009). "Optimizing Working Capital Management." Working Paper. Available at SSRN: http://ssrn.com/abstract=1528894 or http://dx.doi.org/10.2139/ssrn.1528894 (date of access: January 10, 2014). » Link Nobanee, H., and M. Hajjar (2009b). "Working Capital Management, Operating Cash Flow and Corporate Performance." Working Paper. Available at SSRN: http://ssrn.com/abstract = 1471236 (date of access: January 10, 2014). » Link Nowak, M. (1995). Dynamic models of financial management in the enterprise (in Polish: Dynamiczne modele zarzadzania finansami w przedsiebiorstwie). Pret: Warszawa. Opler, T., L. Pinkowitz, R. Stulz, and R. Williamson (1999). "The Determinants and Implications of Corporate Cash Holdings." Journal of Financial Economics 52, pp. 3–46. Opler, T., M. Saron, and S. Titman. (1997). "Designing Capital Structure to Create Shareholder Value." Journal of Applied Corporate Finance 10(1). Opler, T., and S. Titman (1994). "Financial Distress and Corporate Performance." Journal of Finance 49(3). Osband, K. (2011). Pandora's Risk: Uncertainty at the Core of Finance. Columbia Business School Publishing Series. Columbia University Press: New York. Ozkan, A. (2001). "Determinants of Capital Structure and Adjustment to Long Run Target: Evidence from UK Company Panel Data." Journal of Business Finance & Accounting 28(1−2). Petersen, M. A., and R. G. Rajan (1997). "Trade Credit: Theories and Evidence." The Review of Financial Studies 10(3), pp. 661–91. Piotrowska, M. (1997). Finances of Companies: Short-Term Financial Decisions. AE: Wroclaw. Polak, P. (2012). "Addressing the Post-Crisis Challenges in Working Capital Management." International Journal of Research in Management 6(2). http://ssrn.com/abstract = 2195059 (date of access: January 10, 2014). Schwartz, R. A., and D. A. Whitcomb (1978). "Implicit Transfers in the Extension of Trade Credit." In Redistribution through the Financial System: The Grants Economics of Money and Credit. Edited by K. E. Boulding and T. F. Wilson. Preager Special Studies: New York, pp. 191–208. Shapiro, A. C. (1990). Modern Corporate Finance. Macmillan Publishing Company: New York. Shulman, J. M., and R. A. K. Cox (1985). "An Integrative Approach to Working Capital Management." Journal of Cash Management November−December. Smith, J. K. (1987). "Trade Credit and Informational Asymmetry." Journal of Finance 42(4), pp. 863–72. Solomon, E. (1963). The Theory of Financial Management. Columbia University Press: New York. Stark, A. (1987). "On the Observability of the Cash Recovery Rate." Journal of Business, Finance and Accounting 14(4). Thakor, A. V. (1993). "Corporate Investments and Finance." Financial Management Summer, pp. 135−44. Titman, S. (1984). "The Effect of Capital Structure on a Firm's Liquidation Decision." Journal of Financial Economics 13(1). Uyar, A. (2009). "The Relationship of Cash Conversion Cycle with Firm Size and Profitability: An Empirical Investigation in Turkey." International Research Journal of Finance and Economics 24. Vernimmen, P., P. Quiry, M. Dallocchio, Y. Le Fur, and A. Salvi (2009). Corporate Finance: Theory and Practice. John Wiley & Sons: Chichester, UK. Walker, D. A. (1985). "Trade Credit Supply for Small Business." American Journal of Small Business 9(3) Winter, pp. 30–40. Warner, J. (1977). "Bankruptcy Costs: Some Evidence." Journal of Finance 32(2). Warner, J. (1977). "Bankruptcy, Absolute Priority and the Pricing of Risky Debt Claims." Journal of Financial Economics May. Zietlow, J., and A. Seidner (2007). Cash and Investment Management for Nonprofit Organizations. Wiley: Hoboken. Zingales, L. (2000). In Search of New Foundations. Journal of Finance 55(4). Chapter 2. Understanding and Measuring Financial Liquidity Levels Back, P. (2001). "Testing Liquidity Measures as Bankruptcy Prediction Variables." Liiketaloudellinen Aikakauskirja—The Finnish Journal of Business Economics 2001(3). Bagchi, B. and B. Khamrui (2012). "Relationship between Working Capital Management and Profitability: A Study of Selected FMCG Companies in India." Business and Economics Journal 60. Brigham, E. F. (1975). "Hurdle Rates for Screening Capital Expenditure Proposals." Financial Management; 4(3), pp. 17–16 Copeland, T. E., and J. F. Weston (1982). "A Note on the Evaluation of Cancellable Operating Leases." Financial Management 11. Cote, J. M., and C. K. Latham (1999). "The Merchandising Ratio: A Comprehensive Measure of Current Assets Strategy." Issues in Accounting Education 14(2) May, pp. 255–67. Damodaran, A. (1999). Applied Corporate Finance: A User's Manual. John Wiley & Sons: New York. Database Amadeus product of Bureau van Dijk (date of release: 2013 SEP 15). Database Osiris product of Bureau van Dijk (date of release: 2013 SEP 15). Dluhosova, D. (2006). Financial management of firms (in Czech: Financni rizeni a rozhodovani podniku). Ekopress: Prague. Dudycz, T. (2000). Financial analysis (in Polish: Analiza finansowa). AE: Wroclaw. Emery, G., and R. Lyons R. (1991). "The Lambda Index: Beyond the Current Ratio." Business Credit November/December. Etiennot, H., L. A. Preve, and V. S. Allende (2012). "Working Capital Management." Journal of Applied Finance 1 (ISSN 1534-6668), pp. 162–75 [This work was reported also as Etiennot, H., L. Preve, and V. Allende (2011). "Working Capital Management: An Exploratory Study." Journal of Applied Finance 2/2011, pp. 2–23 (available at SSRN: http://ssrn.com/abstract = 2119217).] Fama, E., and H. French (2005). "Financing Decisions: Who Issues Stock." Journal of Financial Economics 76. Fama, E. F. (1980). "Agency Problems and the Theory of the Firm." Journal of Political Economy 88(2). Fernandez, P. (2001a). "Valuing Companies by Cash Flow Discounting: Ten Methods and Nine Theories." EFMA 2002 London Meetings, Working Papers IESE Business School, Madrid. Available at SSRN: http://ssrn.com/abstract = 256987 (date of access: 2014 January 10). » Link Geske, R. (1977). "The Valuation of Corporate Liabilities as Compound Options." Journal of Financial and Quantitative Analysis 12(4). Gill, A., N. Biger, and N. Mathur (2010). "The Relationship between Working Capital Management and Profitability: Evidence from the United States." Business and Economics Journal 10. Graham, J., and C. Harvey (2001). "The Theory and Practice of Corporate Finance: Evidence from the Field." Journal of Financial Economics 60(2−3). Gupta, A., and L. Rosenthal (1991). "Ownership Structure, Leverage, and Firm Value: The Case of Leveraged Recapitalizations." Financial Management 20(3). Heinkel, R. (1982). "A Theory of Capital Structure Relevance under Imperfect Information." Journal of Finance 37(5). Henderson, J. W., and T. S. Maness (1989). The Financial Analyst's Deskbook: A Cash Flow Approach to Liquidity. Van Nostrand Reinhold: New York. Higgins, R. C. (1977). "How Much Growth Can Firms Afford?" Financial Management 6(3). Higgins, R. C. (1981). "Sustainable Growth under Inflation." Financial Management 10(4). Hill, M. D., G. W. Kelly, and M. J. Highfield (2010). "Net Operating Working Capital Behavior: A First Look." Financial Management 39(2), pp. 783–805. Hill, N. C., and W. L. Sartoris (1995). Short-Term Financial Management: Text and Cases. Prentice Hall: Englewood Cliffs, p. 2 Jensen, M. C., and W. H. Meckling (1976). "Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure." Journal of Financial Economics 3(4). Kaplan, S. N., and R. S. Ruback (1995). "The Valuation of Cash Flow Forecast: An Empirical Analysis." Journal of Finance 50(4). Kemna, A. G. Z. (1993). "Case Studies on Real Options." Financial Management 22. Khoury, N., K. Smith, and P. MacKay (1999). "Comparing Current Assets Practices in Canada, the United States and Australia." Revue Canadienne des Sciences de l'Administration 16(1), pp. 53–57. Kieschnick, R. L., M. Laplante, and R. Moussawi (2009). "Working Capital Management, Access to Financing, and Firm Value" Working Paper. Available at SSRN: http://ssrn.com/abstract = 1431165 (date of access: December 10, 2010). » Link Kim, C-S., D. Mauer, and A. Sherman (1998). "The Determinants of Corporate Liquidity: Theory and Evidence." Journal of Financial and Quantitative Analysis 33(3). Lazaridis, I., and D. Tryfonidis (2006). "Relationship between Working Capital Management and Profitability of Listed Companies in the Athens Stock Exchange." Journal of Financial Management and Analysis 19(1), January-June. Available at SSRN: http://ssrn.com/abstract = 931591 (date of access: January 10, 2014). Lee, C. F., and J. E. Finnerty (1990). Corporate Finance: Theory, Method and Applications. HBJ: Orlando, FL. Long, M., L. B. Malitz, and S. A. Ravid (1993). "Trade Credit, Quality Guarantees, and Product Marketability." Financial Management 22. Luehrman, T. A. (1998). "Investment Opportunities as Real Options: Getting Started on the Numbers." Harvard Business Review 4. Maness, T., and J. Zietlow (2005). Short-Term Financial Management. South-Western/Thomson Learning: Mason, OH. Maness, T. S., and J. T. Zietlow (1998). Short-Term Financial Management. Dryden Press: Fort Worth, TX. Martin, J. D., J. W. Petty, A. J. Keown, and D. F. Scott (1991). Basic Financial Management. Prentice Hall: Englewood Cliffs, NJ. Melnyk, Z. L., and A. Birati (1974). "Comprehensive Liquidity Index as Measure of Corporate Liquidity." Scientific and Behavioral Foundations of Decision Sciences. Southeastern Region of the American Institute for Decision Sciences, Atlanta. Michalski, G. (2008). "Value-Based Inventory Management." Journal of Economic Forecasting 9(1), pp. 82–90. Michalski, G. (2010). Strategic management of liquidity in enterprises. (in Polish: Strategiczne zarzadzanie plynnoscia finansowa w przedsiebiorstwie). CeDeWu: Warsaw. Michalski, G. (2012a). "Crisis-Caused Changes in Intrinsic Liquidity Value in Non-Profit Institutions. Equilibrium." Quarterly Journal of Economics and Economic Policy 7(2). Michalski, G. (2012c). "Financial Liquidity Management in Relation to Risk Sensitivity: Polish Firms Case." Proceedings of the International Conference Quantitative Methods in Economics (Multiple Criteria Decision Making XVI). EKONOM: Bratislava, pp. 141–60. Michalski, G. (2012d). "Risk Sensitivity Indicator as Correction Factor for Cost of Capital Rate." Managing and Modelling of Financial Risks: 6th International Scientific Conference Proceedings. Vysoka Skola Banska VSB-TU, Faculty of Economics, Finance Department, Ostrava, pp. 418–28, Available at SSRN: http://ssrn.com/abstract = 2193398 (date of access: January 10, 2014). » Link Modigliani, F., and M. Miller (1963). "Taxes and the Cost of Capital: A Correction." American Economic Review 53(3). Myers, S. (1977). "The Determinants of Corporate Borrowing." Journal of Financial Economics 5(2) Available at MIT: http://dspace.mit.edu/bitstream/handle/1721.1/1915/SWP-0875-02570768.pdf (date of access: January 10, 2014). Myers, S. C. (1977). "Determinants of Corporate Borrowing." Journal of Financial Economics 5. Myers, S. C., and S. M. Turnbull (1977). "Capital Budgeting and the Capital Asset Pricing Model: Good News and Bad News." Journal of Finance 32(2), pp. 321–33. Neftci, S. N. (1996). An Introduction to the Mathematics of Financial Derivatives. Academic Press: San Diego, CA. Nita, B. (2011). "Synthetic indicator of liquidity in static approach in terms of demand for net working capital" (in Polish: "Syntetyczny wskaznik plynnosci finansowej w ujeciu statycznym w kontekscie zapotrzebowania na kapital obrotowy netto"). Research Papers of Wroclaw University of Economics 182, Wroclaw. Nowak, M. (1995). Dynamic models of financial management in the enterprise (in Polish: Dynamiczne modele zarzadzania finansami w przedsiebiorstwie). Pret: Warszawa. Paddock, J. L., D. R. Siegel, and J. L. Smith (1988). "Option Valuation of Claims on Real Assets: The Case of Offshore Petroleum Leases." Quarterly Journal of Economics 103(3). Parrino, R., and D. Kidwell (2008). Fundamentals of Corporate Finance. Wiley: New York. Peasnell, K. (1982). "Some Formal Connections between Economic Values and Yields and Accounting Numbers." Journal of Finance and Accounting 9(3). Peel, M. J., N. Wilson, and C. Howorth (2000). "Late Payment and Credit Management in the Small Firm Sector: Some Empirical Evidence." International Journal of Small Business 18(2). Petersen, M. A., and R. G. Rajan (1997). "Trade Credit: Theories and Evidence." The Review of Financial Studies 10(3), pp. 661–91. Pike, R., and B. Neale (1999). Corporate Finance and Investment: Decisions and Strategies. Prentice Hall: London. Piotrowska, M. (1997). Finances of Companies: Short-Term Financial Decisions. AE: Wroclaw. Piotrowska, M. (1998). "Macroeconomic conditions of the money market in Poland" (in Polish: "Makroekonomiczne uwarunkowania rynku pienieznego w Polsce"). Scientific Papers of the University of Economics in Wroclaw 783, Wroclaw. Polak, P. (2009). "The Centre Holds: From the Decentralised Treasury Towards Fully Centralised Cash and Treasury Management." Journal of Corporate Treasury Management 3(2), pp. 109–12. http://ssrn.com/abstract = 1653318 (date of access: January 10, 2014). Polak, P. (2010). "Centralization of Treasury Management in a Globalized World." International Research Journal of Finance and Economics 56. http://ssrn.com/abstract = 1702687 (date of access: January 10, 2014). » Link Pratt, S., and A. Niculita (2008). Valuing a Business: The Analysis and Appraisal of Closely Held Companies. McGraw-Hill: New York. Preve, L. A., and V. Sarria-Allende (2010). Working Capital Management, Financial Management Association Survey and Synthesis Series. Oxford University Press: New York. Rajan, R., and L. Zingales (1995). "What We Know About Capital Structure: Some Evidence from International Data." Journal of Finance 53(3). Rizzi, J. V. (2007). "How Much Debt Is Right for Your Deal?" Commercial Lending Review 22(4). Ross, S. A. (1977). "The Determination of Financial Structure: The Incentive Signaling Approach." Bell Journal of Economics 8(1). Ross, S. A. (1977). "The Determination of Financial Structure: The Incentive Signaling Approach." Bell Journal of Economics 4. Salamon, G. L. (1982). "Cash Recovery Rates and Measures of Firm Profitability." Accounting Review 57. Samuels, J. M., F. M. Wilkers, and R. E. Brayshaw (1993). Management of Company Finance. Chapman & Hall: London. Sarjusz-Wolski, Z. (2000). Inventory control in an enterprise (in Polish: Sterowanie zapasami w przedsiebiorstwie). PWE: Warszawa. Scherr, F. C. (1996). "Optimal Trade Credit Limits." Financial Management 25 (1) (Spring), pp. 71–85. Schilling, G. (1996). "Working Capital's Role in Maintaining Corporate Liquidity." TMA Journal 16(5). Schwartz, R. A. (1974). "An Economic Model of Trade Credit." Journal of Financial and Quantitative Analysis 9(4), pp. 643–57. Schwartz, R. A., and D. A. Whitcomb (1978). "Implicit Transfers in the Extension of Trade Credit." In Redistribution through the Financial System: The Grants Economics of Money and Credit. Edited by K. E. Boulding and T. F. Wilson. Preager Special Studies: New York, pp. 191–208. Shapiro, A. C., and S. D. Balbier (2000). Modern Corporate Finance. Prentice Hall: Upper Saddle River, NJ. Shulman, J. M., and R. A. K. Cox (1985). "An Integrative Approach to Working Capital Management." Journal of Cash Management November−December. Siegel, J. G., J. K. Shim, and W. G. Hartman (1999). Guide to finance (in Polish: Przewodnik po finansach). WN PWN: Warsaw. Sierpinska, M., and D. Wedzki (2002). Financial liquidity management in an enterprise (in Polish: Zarzadzanie plynnoscia finansowa w przedsiebiorstwie). WN PWN: Warsaw. Singh, P. (2008). "Inventory and Working Capital Management: An Empirical Analysis." The ICFAI Journal of Accounting Research 7(2), pp. 53–73. Smith J. K., and C. Schnucker (1994). "An Empirical Examination of Organizational Structure: The Economics of Factoring Decision." Journal of Corporate Finance 1. Soltes, V. (2012). "Paradigms of Changes in the 21st Century: Quest for Configurations in Mosaic." Ekonomicky Casopis 60(4). Spremann, K. (2010). "Old and New Financial Paradigms." In Current Challenges for Corporate Finance: A Strategic Perspective. Edited by G. Eilenberger. Springer-Verlag: Berlin Heidelberg. Summers, B., and N. Wilson (2002). "The Empirical Investigation of Trade Credit Demand." International Journal of the Economics of Business 9(2), pp. 257–70. Titman, S., and R. Wessels (1988). "The Determinants of Capital Structure Choice." Journal of Finance 43(1),pp. 1–19. Varian, H. R. (1987). "The Arbitrage Principle in Financial Economics." Economic Perspectives 1(2). Waiss, L. (1990). "Bankruptcy Resolution: Direct Cost and Violation of Priority Claims." Journal of Financial Economics 27(2). Walker, D. A. (1985). "Trade Credit Supply for Small Business." American Journal of Small Business 9(3) Winter, pp. 30–40. Walter, J. (1957). "Determination of Technical Solvency." Journal of Business January. Washam, J., and D. Davis (1998). "Evaluating Corporate Liquidity." TMA Journal 18(2). Weston, F. (1963). "A Test of Cost of Capital Propositions." The Southern Economic Journal 30(2). Wojciechowska, U. (2001). Liquidity of Polish companies in transition economy: Microeconomic and macroeconomic aspects (in Polish: Plynnosc finansowa polskich przedsiebiorstw w okresie transformacji gospodarki). SGH: Warsaw. Zietlow, J., and A. Seidner (2007). Cash and Investment Management for Nonprofit Organizations. Wiley: Hoboken. Chapter 3. Intrinsic and External Values of Liquidity and Optimization Altman, E. (1984). "A Further Empirical Investigation of the Bankruptcy Cost Question." Journal of Finance 39. Asch, D., and G. R. Kaye (1997). Financial Planning: Profit Improvement through Modelling. Kogan Page: London. Baker, M., and J. Wurgler (2002). "Market Timing and Capital Structure." Journal of Finance 57. Banos-Caballero, S., P. J. García-Teruel, and P. Martinez-Solano (2010). "Working Capital Management in Enterprises." Accounting & Finance 50(3), pp. 511–27. Beck, P. E., and D. R. Stockman (2005). "Money as Real Options in a Cash-in-Advance Economy." Economics Letters 87. Blaug, M. (1985). Economic Theory in Retrospect. Cambridge University Press: Cambridge. Brealey, R. A., and S. C. Myers (1999). Basics of enterprises finance (Polish edition: Podstawy finansow przedsiebiorstw). WN PWN: Warszawa. Brennan, M. J., and E. S. Schwartz (1985). "Evaluating Natural Resource Investments." Journal of Business 58(2). Brigham, E. F. (1975). "Hurdle Rates for Screening Capital Expenditure Proposals." Financial Management; 4(3), pp. 17–16 Chriss, N. A. (1997). Black-Scholes and Beyond: Options Pricing Models. McGraw-Hill: New York. Copeland, T. E., and J. F. Weston (1982). "A Note on the Evaluation of Cancellable Operating Leases." Financial Management 11. Cox, J., S. Ross, and M. Rubinstein (1979). "Option Pricing: A Simplified Approach." Journal of FinancialEconomics 7. Database Amadeus product of Bureau van Dijk (date of release: 2013 SEP 15). DeAngelo, H., and R. Masulis (1980). "Optimal Capital Structure under Corporate and Personal Taxation." Journal of Financial Economics 8(1). Deloof, M. (2003). "Does Working Capital Management Affect Profitability of Belgian Firms?" Journal of Business Finance & Accounting 30(3 − 4), pp. 573–88. Dixit, A. K., and R. S. Pindyck (1994). Investment under Uncertainty. Princeton University Press: Princeton, NJ. Dixit, A. K., and R. S. Pindyck (1995). "The Options Approach to Capital Investment." Harvard Business Review 73(3), May−June, pp. 105−115. Dluhosova, D. (2006). Financial management of firms (in Czech: Financni rizeni a rozhodovani podniku). Ekopress: Prague. Eckbo, B. E. (2007). Handbook of Corporate Finance: Empirical Corporate Finance. Elsevier/North Holland: Amsterdam. Fernandez, P. (2001b). "Valuing Real Options: Frequently Made Errors." Working Papers IESE Business School, Madrid. Available at SSRN: http://ssrn.com/abstract = 274855 or http://dx.doi.org/10.2139/ssrn.274855 (date of access: January 10, 2014). » Link Fewings, D. R. (1996). "Unbiased Trade Credit Decisions under Imperfect Information." Advances in Working Capital Management 3. Fisher, E., R. Heinkel, and J. Zechner (1989). Dynamic Capital Structure Choice: Theory and Tests. Journal of Finance 44. Frank, M., and V. Goyal (2003). Testing the Pecking Order Theory of Capital Structure. Journal of Financial Economics 67. Frank, M., and V. Goyal (2009). "Capital Structure Decisions: Which Factors Are Reliably Important?" Financial Management 38. Hamada, R. (1969). "Portfolio Analysis, Market Equilibrium, and Corporation Finance." Journal of Finance 24(2). Harris, R. S., and J. J. Pringle (1985). "Risk-Adjusted Discount Rates: Extensions from the Average-Risk Case." Journal of Financial Research 8(3). Haugen, R., and L. Senbet (1978). "The Insignificance of Bankruptcy Costs to the Theory of Optimal Capital Structure." Journal of Finance 33(2). Herath, H. S. B., and C. S. Park (1999). "Economic Analysis of R&D Projects: An Options Approach." Engineering Economist 44(1). Herath, H. S. B., and C. S. Park (2002). "Multi-Stage Capital Investment Opportunities as Compound Real Options." Engineering Economics 47(1). Hill, M. D., G. W. Kelly, and M. J. Highfield (2010). "Net Operating Working Capital Behavior: A First Look." Financial Management 39(2), pp. 783–805. Hill, N. C., and W. L. Sartoris (1995). Short-Term Financial Management: Text and Cases. Prentice Hall: Englewood Cliffs, p. 2 Hirshleifer, J. (1965). "Investment Decisions under Uncertainty: Choice Theoretic Approaches." Quarterly Journal of Economics 74(4). Hubalek, F., and W. Schachermayer (2001). "The Limitations of No-Arbitrage Arguments for Real Options." International Journal of Theoretical and Applied Finance 4(2). Jajuga, K. (2005). "Problems in Operational Risk Measurement." In Finansowanie dzialalnosci przedsiebiorstw. Wydawnictwo WSB: Poznan, pp. 137–44. Kester, W. C. (1984). "Today's Options for Tomorrow's Growth." Harvard Business Review 2. Kogut, B., and N. Kulatilaka (2004). "Real Options Pricing and Organizations: The Contingent Risks of Extended Theoretical Domains." Academy of Management Science 29(1). Kulatilaka, N. (1993). "The Value of Flexibility: The Case of Dual-Fuel Industrial Steam Boiler." Financial Management 3. Kulatilaka, N., and L. Trigeorgis (2001). "The General Flexibility to Switch." In Real Options and Investment under Uncertainty. Edited by E. S. Schwartz and L. Trigeorgis. MIT Press: Cambridge, MA. Lee, C. F., and J. E. Finnerty (1990). Corporate Finance: Theory, Method and Applications. HBJ: Orlando, FL. Lee, Y. W., and J. D. Stowe (1993). "Product Risk, Asymmetric Information, and Trade Credit." Journal of Financial and Quantitative Analysis 28, pp. 285–300. Leland, H. (1994). "Corporate Debt Value, Bond Covenants, and Optimal Capital Structure." Journal of Finance 49(4). Leland, H. E., and D. H. Pyle (1977). "Informational Asymmetries, Financial Structure and Financial Intermediation." Journal of Finance 32(2). Lessard, D. R. (1996). "Incorporating Country Risk in the Valuation of Offshore Projects." Journal of Applied Corporate Finance 9(3). Lofthouse, S. (2005). Investment Management. Wiley: Chichester, UK. Long, M., L. B. Malitz, and S. A. Ravid (1993). "Trade Credit, Quality Guarantees, and Product Marketability." Financial Management 22. Luehrman, T. A. (1998). "Investment Opportunities as Real Options: Getting Started on the Numbers." Harvard Business Review 4. Lumby, S. (1993). Investment Appraisal and Financing Decisions. The Chapman & Hall Series in Accounting and Finance. Routledge Chapman & Hall: London. Madden, B. (1999). CFROI Valuation: A Total System Approach to Valuating the Firm. Butterworth-Heinemann: Oxford. Majd, S., and R. S. Pindyck (1987). "Time-to-Build Option Value and Investment Decisions." Journal of Financial Economics 18. Makridiakis, S., and S. Wheelwright (1989). Forecasting Methods for Management. Wiley & Sons: New York. Marris, R. (1963). "A Model of the 'Managerial' Enterprise." The Quarterly Journal of Economics 77(2). Masulis, R. (1980). "The Impact of Capital Structure Change on Firm Value: Some Estimates." Journal of Finance 38(1). McDonald, R., and D. Siegel (1986). "The Value of Waiting to Invest." Quarterly Journal of Economics 101(4). McGrath, R. G., W. J. Ferner, and A. L. Mendelow (2004). "Real Options as Engines of Choice and Heterogeneity." Academy of Management Review 29(1). Merton, R., and A. Perold (1999). "Theory of Risk Capital in Financial Firms." In The New Corporate Finance: Where Theory Meets Practice. Edited by D. H. Chew. McGraw-Hill: Boston. Merton, R. C. (1973). "Theory of Rational Option Pricing." Bell Journal of Economics and Management Science 4(1). Michalski, G. (2008). "Value-Based Inventory Management." Journal of Economic Forecasting 9(1), pp. 82–90. Michalski, G. (2010). Strategic management of liquidity in enterprises. (in Polish: Strategiczne zarzadzanie plynnoscia finansowa w przedsiebiorstwie). CeDeWu: Warsaw. Michalski, G. (2012a). "Crisis-Caused Changes in Intrinsic Liquidity Value in Non-Profit Institutions. Equilibrium." Quarterly Journal of Economics and Economic Policy 7(2). Michalski, G. (2012b). "Crisis Influence on General Economic Condition and Corporate Liquidity Management: Financial Liquidity Investment Efficiency Model (FLIEM) Use to Diagnose Polish Economics Standing." Proceedings of the 7th International Conference on Currency, Banking and International Finance: How Does Central and Eastern Europe Cope with the Global Financial Crisis? EKONOM: Bratislava, pp. 200–219. Michalski, G. (2012c). "Financial Liquidity Management in Relation to Risk Sensitivity: Polish Firms Case." Proceedings of the International Conference Quantitative Methods in Economics (Multiple Criteria Decision Making XVI). EKONOM: Bratislava, pp. 141–60. Michalski, G. (2012d). "Risk Sensitivity Indicator as Correction Factor for Cost of Capital Rate." Managing and Modelling of Financial Risks: 6th International Scientific Conference Proceedings. Vysoka Skola Banska VSB-TU, Faculty of Economics, Finance Department, Ostrava, pp. 418–28, Available at SSRN: http://ssrn.com/abstract = 2193398 (date of access: January 10, 2014). » Link Miller, M. (1988). "The Modigliani-Miller Propositions after 30 Years." Journal of Economic Perspectives 2(4). Modigliani, F., and M. Miller (1958). "The Cost of Capital, Corporation Finance and the Theory of Investment." American Economic Review 48(3). Moles, P., and N. Terry (1999). The Handbook of International Financial Terms. Oxford University Press: Oxford. Moyer, R. C., J. R. McGuigan, and W. J. Ketlow (1990). Contemporary Financial Management. West Publishing Company: Saint Paul. Mun, J. (2002). Real Option Analysis. Tools and Techniques for Valuing Strategic Investments and Decisions. John Wiley & Sons: Hoboken, NJ. Myers, S. (1977). "The Determinants of Corporate Borrowing." Journal of Financial Economics 5(2) Available at MIT: http://dspace.mit.edu/bitstream/handle/1721.1/1915/SWP-0875-02570768.pdf (date of access: January 10, 2014). Myers, S. (1998). "The Search of Capital Structure Puzzle." In Financial Strategy: Adding Shareholder Value. Edited by J. Rutterford. John Wiley & Sons: Chichester. Myers, S. C. (1977). "Determinants of Corporate Borrowing." Journal of Financial Economics 5. Myers, S. C. (2001). "Finance Theory and Financial Strategy." In Real Options and Investment under Uncertainty. Edited by E. S. Schwartz and L. Trigeorgis. MIT Press: Cambridge, MA. Myers, S. C., and S. M. Turnbull (1977). "Capital Budgeting and the Capital Asset Pricing Model: Good News and Bad News." Journal of Finance 32(2), pp. 321–33. Nobanee, H. (2009). "Working Capital Management and Firm's Profitability: An Optimal Cash Conversion Cycle." Working Paper. Available at SSRN: http://ssrn.com/abstract=1471230 or http://dx.doi.org/10.2139/ssrn.1471230 (date of access: January 10, 2014). » Link Nobanee, H., W. K. Al Shattarat, and A. E. Haddad (2009). "Optimizing Working Capital Management." Working Paper. Available at SSRN: http://ssrn.com/abstract=1528894 or http://dx.doi.org/10.2139/ssrn.1528894 (date of access: January 10, 2014). » Link Nobanee, H., and M. Hajjar (2009a). "A Note on Working Capital Management and Corporate Profitability of Japanese Firms." Working Paper. Available at SSRN: http://ssrn.com/abstract = 1433243 or http://dx.doi.org/10.2139/ssrn.1433243 (date of access: January 10, 2014). » Link Opler, T., L. Pinkowitz, R. Stulz, and R. Williamson (1999). "The Determinants and Implications of Corporate Cash Holdings." Journal of Financial Economics 52, pp. 3–46. Opler, T., M. Saron, and S. Titman. (1997). "Designing Capital Structure to Create Shareholder Value." Journal of Applied Corporate Finance 10(1). Osband, K. (2011). Pandora's Risk: Uncertainty at the Core of Finance. Columbia Business School Publishing Series. Columbia University Press: New York. Ozkan, A. (2001). "Determinants of Capital Structure and Adjustment to Long Run Target: Evidence from UK Company Panel Data." Journal of Business Finance & Accounting 28(1−2). Piotrowska, M. (1998). "Macroeconomic conditions of the money market in Poland" (in Polish: "Makroekonomiczne uwarunkowania rynku pienieznego w Polsce"). Scientific Papers of the University of Economics in Wroclaw 783, Wroclaw. Polak, P. (2012). "Addressing the Post-Crisis Challenges in Working Capital Management." International Journal of Research in Management 6(2). http://ssrn.com/abstract = 2195059 (date of access: January 10, 2014). Poteshman, A., R. Parrino, and M. Weisbach (2005). "Measuring Investment Distortions When Risk-Averse Managers Decide Whether to Undertake Risky Project." Financial Management 34, pp. 21–60. Rappaport, A. (1988). Creating Shareholder Value: A Guide for Managers and Investors. Free Press: New York. Razgaitis, R. (2003). Dealmaking Using Real Options and Monte Carlo Analysis. John Wiley and Sons: New York. Reilly, F. (1992). Investments. The Dryden Press: Fort Worth, TX. Remer, D. S., S. B. Stokdyk, and M. L. Van Driel (1993). "Survey of Project Evaluation Techniques Currently Used in Industry." International Journal of Production 32(3). Ross, S. A. (1973). "The Economic Theory of Agency: The Principal's Problem." American Economic Review 63(2). Ross, S. A. (1977). "The Determination of Financial Structure: The Incentive Signaling Approach." Bell Journal of Economics 8(1). Ross, S. A. (1977). "The Determination of Financial Structure: The Incentive Signaling Approach." Bell Journal of Economics 4. Ross, S. A. (1995). "Uses, Abuses and Alternatives to Net-Present-Value Rule." Financial Management 24(3). Rubinstein, M. (1973). "A Mean-Variance Synthesis of Corporate Financial Theory." Journal of Finance 28(1). Salamon, G. L. (1985). "Accounting Rates of Return." American Economic Review 75. Salamon, G. L. (1988). "On the Validity of Accounting Rates of Return in Cross-Sectional Analysis: Theory, Evidence, and Implications." Journal of Accounting and Public Policy 7. Scherr, F. C. (1989). Modern Working Capital Management. Text and Cases. Prentice Hall: Englewood Cliffs, NJ. Schilling, G. (1996). "Working Capital's Role in Maintaining Corporate Liquidity." TMA Journal 16(5). Sharpe, W. F. (1964). "Capital Assets Prices: A Theory of Market Equilibrium under Conditions of Risk." Journal of Finance 19 (3), pp. 425–42. Shiller, F. J., and F. Modigliani (1979). "Coupon and Tax Effects on New and Seasoned Bond Yields and the Measurement of Cost of Debt Capital." Journal of Financial Economics 7(3). Shleifer, A., and R. Vishny (1992). "Liquidation Values and Debt Capacity: A Market Equilibrium Approach." Journal of Finance 47(4). Smith, J. E., and K. F. McCardle (1998). "Valuing Oil Properties: Integrating Option Pricing and Decision Analysis Approaches." Operations Research 46(2). Smith, J. E., and R. F. Nau (1995). "Valuing Risky Projects: Option Pricing Theory and Decision Analysis." Management Science 41(5). Stiglitz, J. (1969). "A Re-Examination of the Modigliani-Miller Theorem." American Economic Review 59(5). Stiglitz, J. E., and A. Weiss (1981). "Credit Rationing in Markets with Imperfect Information." American Economic Review 71(3). Taggart, R. A. (1991). "Consistent Valuation and Cost of Capital: Expressions with Corporate and Personal Taxes." Financial Management 20(3). Trigeorgis, L. (1996). Real Options: Managerial Flexibility and Strategy in Resource Allocation. MIT Press: Cambridge, MA. Turnbull, S. M. (1979). "Debt Capacity." Journal of Finance 34(4). Washam, J., and D. Davis (1998). "Evaluating Corporate Liquidity." TMA Journal 18(2). Zmeskal, Z., and D. Dluhosova (2009). "Company Financial Performance Prediction on Economic Value Added Measure by Simulation Methodology." Proceedings of the 27th International Conference on Mathematical Methods in Economics, Mathematical Methods in Economics; H. Brožová, R. Kvasnička eds., Czech University of Life Sciences, Chapter 4. Net Working Capital Management Strategies Database Amadeus product of Bureau van Dijk (date of release: 2013 SEP 15). Michalski, G. (2008). "Value-Based Inventory Management." Journal of Economic Forecasting 9(1), pp. 82–90. Michalski, G. (2009). "Effectiveness of Investment in Operating Cash." Journal of Corporate Treasury Management 3(1). Piotrowska, M. (1997). Finances of Companies: Short-Term Financial Decisions. AE: Wroclaw. Sarjusz-Wolski, Z. (2000). Inventory control in an enterprise (in Polish: Sterowanie zapasami w przedsiebiorstwie). PWE: Warszawa. Sierpinska, M., and D. Wedzki (2002). Financial liquidity management in an enterprise (in Polish: Zarzadzanie plynnoscia finansowa w przedsiebiorstwie). WN PWN: Warsaw. Conclusion Etiennot, H., L. A. Preve, and V. S. Allende (2012). "Working Capital Management." Journal of Applied Finance 1 (ISSN 1534-6668), pp. 162–75 [This work was reported also as Etiennot, H., L. Preve, and V. Allende (2011). "Working Capital Management: An Exploratory Study." Journal of Applied Finance 2/2011, pp. 2–23 (available at SSRN: http://ssrn.com/abstract = 2119217).] Further References from Value-Based Working Capital Management Ehrhardt, M., and P. Daves (2002). "Corporate Valuation: The Combined Impact of Growth and the Tax Shield of Debt on the Cost of Capital and Systematic Risk." Journal of Applied Finance 12(2), pp. 31–38. Elvin, M. (2004). Financial Risk Taking: An Introduction to the Psychology of Trading and Behavioural Finance. John Wiley & Sons: Chichester, West Sussex, Hoboken, NJ. García Teruel, P. J., and P. Martínez Solano (2007). "Effects of Working Capital Management on Enterprise Profitability." International Journal of Managerial Finance 3, pp. 164–77. Grinblatt, M., and S. Titman (2001). Financial Markets and Corporate Strategy. McGraw-Hill/Irwin: Boston. Kerkhof, J., B. Melenberg, and H. Schumacher (2010). "Model Risk and Capital Reserves." Journal of Banking & Finance 34, pp. 267–79. Leary, M., and M. Roberts (2005). "Do Firms Rebalance Their Capital Structure?" Journal of Finance 60(6). Margrabe, R. (1978). "The Value of an Option to Exchange One Asset for Another." Journal of Finance 33(1). Markowitz, H. M. (1952). "Portfolio Selection." Journal of Finance 7 (1), pp. 77–91. Triantis, A., and A. Borison (2001). "Real Options: State of Practice." Journal of Applied Corporate Finance 14(2). Van der Wijst, D. (1989). Financial Structure in Small Business: Theory, Tests and Applications. Lecture Notes in Economics and Mathematical Systems, vol. 320. Springer-Verlag: Berlin Heidelberg. Vijayakumar, A. (2011). "Cash Conversion Cycle and Corporate Profitability: An Empirical Enquiry in Indian Automobile Firms." International Journal of Research in Commerce, IT & Management 1(2). ; National Science Centre no. DEC-2011/01/B/HS4/04744 ; Grzegorz Michalski

This paper contributes to the economic analysis of illicit activities and money laundering. First, it presents a theoretical model of long-run growth that explicitly considers illicit workers, activities, and income, alongside a licit private sector and a functioning government. Second, it generates estimates of the size of illicit income and provides simulated and econometric estimates of the volume of laundered assets in the Colombian economy. In the model, the licit sector operates in a perfectly competitive environment and produces a licit good through a standard neoclassical production function. The illicit sector operates in an imperfectly competitive environment and is composed of two different activities: The first activity produces an illicit good that nonetheless is valuable in the market (for example illicit drugs); the second does not add value to the economy but only redistributes wealth (for example robbery, kidnapping, and fraud). The paper provides a series of comparative statics exercises to assess the effects of changes in government efficiency, licit sector productivity, and illicit drug prices. From the model, the analysis derives a set of estimable macroeconometric equations to measure the size of laundered assets in the Colombian economy in the period 1985 to 2013. The paper assembles a data set whose key components are estimates of illicit income from drug trafficking and common crime. Illicit incomes increased drastically until 2001, reaching a peak of nearly 12 percent of gross domestic product and then decreasing to less than 2 percent by 2013. The decline overlaps not only in a period of high economic growth, but also after the implementation of Plan Colombia. The data set is used to estimate the volume of laundered assets in the economy by applying the Kalman filter for the estimation of unobserved dynamic variables onto the derived macroeconometric equations from the model. The findings show that the volume of laundered assets increased from about 8 percent of gross domestic product in the mid-1980s to a peak of 14 percent by 2002, and declined to 8 percent in 2013.

This report summarizes findings from an allocative efficiency and financial commitment analysis conducted for the Government of Zambia by the World Bank and the University of New South Wales. It uses Optima, a mathematical model of HIV transmission and disease progression. Optima is a population-based and flexible model, which provides a formal method of optimization and determines optimal allocations of HIV resources across numerous HIV programs, target populations, and funding levels. It also provides epidemic, investment scenario and financial commitment analysis.

As Russian forces steadily advance in the Kharkiv region, it is becoming ever more clear that the Ukraine war has been a disaster for the U.S. defense machine, and not just because our aid has failed to save Ukraine from retreat and possible defeat. More importantly, the war has pitilessly exposed our defense system's deep, underlying, faults.Critics have long maintained that our obsession with technologically complex weapons inevitably yields unreliable systems produced in limited numbers because of their predictably high cost. They are furthermore likely to fail in combat because of the military's lack of interest in adequate testing (lest realistic tests reveal serious shortcomings and thereby threaten the budget.) The unforgiving operational test provided by the Ukraine war has shown that the critics were absolutely right. Successive "game changing" systems - such as the Switchblade drone, the M-1 Abrams tank, Patriot air defense missiles, the M777 howitzer, the Excalibur guided 155 mm artillery round, the HIMARS precision missile, GPS-guided bombs, and Skydio drones endowed with artificial intelligence, were all dispatched to "the fight," as the military like to call it, with fanfare and high expectations. All were destined to fail for reasons rooted in the fundamental problems cited above. The $60,000 Switchblade drone, produced in limited numbers due to cost, proved useless against armored targets and was quickly discarded by Ukrainian troops in favor of $700 Chinese commercial models ordered online. The $10 million Abrams tank not only proved distressingly vulnerable to Russian attack drones but in any case broke down repeatedly and was soon withdrawn from combat, though not before the Russians put several out of action and captured at least one, which they took to Moscow and added to a display of Nato weaponry in a Moscow park that included an M777 howitzer and other items of NATO hardware. The M777 cannon, though touted for its accuracy, has proved too delicate for the rough conditions of sustained combat, with barrels regularly wearing out and requiring replacement in Poland far from the front lines . Notoriously, its 155 mm ammunition has been in short supply. Thanks to the consolidation of the U.S. defense industry into a small number of monopolies, an ill-judged policy eagerly promoted since the Clinton Administration, U.S. domestic production of 155 mm shells is reliant on a single aging General Dynamics plant in Scranton, Pennsylvania, which is struggling to meet its targets. President Zelensky has been loudly demanding more Patriot launchers and missiles to defend Kharkiv, which is curious, given the apparent ease with which the Russians have targeted Patriots defending Kyiv, and the system's declining effectiveness against Russian ballistic missiles. HIMARS long range missiles indeed had a deadly effect on high value Russian targets, such as ammunition dumps, but the Russians adapted by dispersing and camouflaging such dumps and other likely targets.Take it from a Ukrainian: Western Systems "Worthless."Strikingly, many of the failures of U.S. weapons, including the HIMARS, in Ukraine have been due to their reliance on a highly vulnerable guidance system: GPS. The Russians, who have long devoted intense care and attention to electronic warfare, have proven increasingly adept at jamming GPS. This has been most witheringly expressed by Maria Berlinskaya, a pioneer in Ukraine's use of drones and head of the country's aerial reconnaissance support center, who recently stated that "most Western systems have proven to be [worthless]" thanks to Russian jamming. Her gloomy assessment was confirmed in April by none other than William LaPlante, Under Secretary of Defense for Acquisition and Sustainment, who told a CSIS conference how a company (Boeing, though he did not name it) had proposed adapting their small diameter GPS guided bomb as a warhead for the HIMARS. It had been accordingly rushed through development and into production, with little or no testing, and shipped off to Ukraine. "It just didn't work," admitted LaPlante, thanks to Russian GPS jammers that threw it off course and caused it to miss. The same sad fate seems to have befallen the Skydio drone, product of an eponymous Silicon Valley startup, whose AI features trumpeted by the company - "Skydio drones have the compute capacity to see, understand, and react in real time" - did not prevent it from being driven off course by Putin's jammers.Sullivan and His Pals Drank the Kool Aid the Military Poured for Them.Needless to say, none of these assorted failures were anticipated by the U.S. military high command, few of whom would be eager to denigrate the wares of contractors with lucrative post-retirement board seats on offer. We might hope that our senior civilian leadership would be aware of such biases and temper their expectations accordingly. Unfortunately, they drank the Kool Aid, as evidenced for their high expectations for the 2023 Ukrainian counter-offensive. Despite high hopes and lavish supplies of weapons, including tanks, ammunition, drones, intensive training on the territory of NATO allies, and a grounding in U.S. command and control doctrine, the counter-offensive was an immediate and total failure. Planners were apparently caught by surprise by the depth of Russia's (easily visible) defensive fortifications, especially minefields and the effectiveness of its electronic jamming. Ever since then, Ukraine has been steadily retreating, losing in the process its reserves of military manpower.Then There's Corruption.Not all of Ukraine's dire situation can be blamed on the military deficiencies of its major Nato ally. The country's infamous corruption, well known to western governments but generally ignored in the western press, is currently highlighted by its crumbling defenses around Kharkiv. According to an exemplary report by Ukrainian anti-corruption researcher Martyna Boguslavets, published in the Kyiv-based Ukraina Pravda, the huge sums appropriated for building fortifications around the city have simply been stolen. Here is her report (machine translated.)Martyna BoguslavetsChairman of the Anti-corruption Center "Mezha"Where are the fortifications? Kharkiv OVA paid millions to fictitious companiesMONDAY, MAY 13, 2024,Hundreds of millions of hryvnias have probably been stolen from the construction of fortifications in the Kharkiv region, where the [Russians are] now actively advancing. Multi-million dollar contracts for the construction of fortifications, for which a total of 7 billion hryvnias [$173 million] were spent there, were transferred by the Kharkiv OVA [regional military adminsitration] to front companies of avatars.In particular, the Department of Housing and Communal Services (ZhKG) and the fuel and energy complex of Kharkiv OVA concluded direct contracts for the supply of wood for fortifications with companies with signs of fictitiousness.For 270 million [approx $6 million] for wood, information about which is classified, contracts were concluded with FOP Chaus I.O., LLC "Hertz Industry", LLC "Satisbud", LLC "ATT BUILD" and LLC "DEREVOOBROBNE PIDPRIEMSTVO VOSHOD".All of them started making millions immediately within a few months of signing up. Classic - under direct contracts and without competitive procurement.It so happened that the department of the Kharkiv OVA for defense procurement chose newly registered anonymous firms and private enterprises. Moreover, the owners of these firms do not resemble successful businessmen and businesswomen - they have dozens of court cases, from whiskey theft to domestic violence against a husband and mother, some of them are deprived of parental rights and have had enforcement proceedings for bank loans.Another interesting detail - it seems that these beneficiaries do not even know that they are millionaires. After all, they continue to work in shifts "in the fields" and factories.Once again: in OVA, direct contracts for wood for fortifications have been concluded with companies whose "owners" do not even know that they are making millions. This is how military information is classified."Secret" avatars of Kharkiv OVAIt is obvious that contractors for military deals were carefully sought - people who are not rich, with a number of court cases and debts. Some of them are even related to each other.The scheme started with FOP Chaus Ihor Olegovych. Three months after registration, the OVA department concludes direct contracts with him for the supply of wood worth millions of hryvnias.It is interesting that in July 2023, when Chaus just registered the FOP, he had enforcement proceedings for a fine from the police. Earlier, he was found guilty of stealing a pint of Jack Daniels from ATB. He served 100 hours of community service for the stolen whiskey. A successful businessman from the bad 2010sThe "successful businesswomen" scheme was continued. Both are from the city of Kamianske, Dnipropetrovsk region.The first is Victoria Smolyak, owner of Hertz Industry LLC. The company was registered in June 2023, and within a few months it began to earn millions from wood. Again, under direct contracts. In less than a year, the company changes four managers, which is also a sign of fictitiousness.Mrs. Smolyak has not only a limited liability company, but also 5 enforcement proceedings for recovery from banks, courts for evasion of parental duties. A drunk woman committed domestic violence against her mother. Currently, she works at the Dnipro metallurgical plant.Not very similar to the owner of a successful company that earned 116 million [$2.9 million] from the OVA department in 9 months?Send feedbackThe second businesswoman is Natalia Koval. LLC "Satisbud" is registered on it three days after the registration of "Hertz Industry". Another successful company, through which more than [$1.3 million] are finnele.The owner of the company also has a bunch of court cases, in particular, regarding the deprivation of parental rights, being in a public place in a drunken state, committing domestic violence against her husband. As we learned, the woman now works in shifts in the fields.It is interesting that both "Hertz Industry" LLC and "Satisbud" LLC have the same director - Dmytro Knorozov. It is expected, and he also has enforcement proceedings, where he acts as a debtor.Through the following companies - "ATT BUD" and "WOOD PROCESSING ENTERPRISE VOSHOD" the Department of Housing and Urban Development of the Kharkiv Oblast is chasing away millions. Their owners and managers are connected to more than 30 more recently established companies with a wide range of activities.According to this scheme, the naked eye can see how someone, being a member of the government offices, mercilessly registers new companies, using for this purpose people who, due to the circumstances, may not be aware of this. And this someone continues to make money on blood.Ideally, this should become useful information for law enforcement agencies and further exposure of fictitious companies that steal millions from the Armed Forces. After all, most of these dozens of companies are currently dormant and are probably standing by for further participation in schemes for withdrawing funds into the shadows and tax evasion.Notably, Boguslavets' report is based on public documents, available to anyone who cared to probe, which did not apparently include the host of U.S. correspondents covering the war.This article has been republished with permission from Andrew Cockburn's Spoils of War