FACTORS DETERMINING LEVELS OF FINANCIAL FLEXIBILITY: AN ANALYTICAL STUDY OF A NUMBER OF COMPANIES LISTED ON THE IRAQ STOCK EXCHANGE

Sura Taki Mohammed Ali  Al-Sultan; Namir Amir Jasim  Al-Saegh

Авторы

Sura Taki Mohammed Ali Al-Sultan University of Mosul, Iraq
Namir Amir Jasim Al-Saegh University of Mosul, Iraq

Ключевые слова:

financial flexibility, net cash flows, current assets

Аннотация

Financial flexibility is one of the fundamental pillars on which companies base their financial decision-making, as it helps to enhance their competitiveness and enables them to secure the funding required for their long-term investments. Despite the importance of this topic, in-depth studies on the subject remain relatively limited. This has prompted the present study to focus on identifying the key determinants of financial flexibility, as well as testing the extent to which these indicators can be used to guide decision-makers towards more prudent financial decisions. To achieve the study’s objectives, the researchers adopted the Autoregressive Distributed Lag (ARDL) model methodology, drawing on time-series data covering the period from 2010 to 2025, equivalent to sixteen years of annual observations. The study sample consisted of a group of companies listed on the Iraq Stock Exchange, whilst the Eviews 11 software was used to carry out the financial and statistical analyses, in addition to employing a number of financial equations and ratios. The study's findings demonstrated that total assets, current assets, and fixed assets are some of the most important variables affecting net cash flows because, while the degree of this effect varied from company to company, these variables unmistakably helped to explain the differences seen among the companies in the study sample. The findings also supported the primary hypothesis of the study by confirming the presence of a statistically significant association between net cash flows and specific financial and macroeconomic factors. In order to increase positive cash flows and guarantee the long-term sustainability of financial performance, the study advises businesses to pay more attention to financial flexibility indicators and improve the efficiency of their management, especially with regard to the management of total assets and the improvement of their structure.

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