TAILIEUCHUNG - Factors that influence financial leverage of Canadian firms

This study contributes to the literature on the factors that influence financial leverage of the firm. The findings may be useful for financial managers, investors, and financial management consultants. | Journal of Applied Finance Banking 2011 19-37 ISSN 1792-6580 print version 1792-6599 online International Scientific Press 2011 Factors that Influence Financial Leverage of Canadian Firms Amarjit Gill1 and Neil Mathur2 Abstract The purpose of this study is to find the factors that influence financial leverage of Canadian firms. A sample of 166 Canadian firms listed on the Toronto Stock Exchange for a period of 3 years from 2008-2010 was selected. This study applied co-relational and non-experimental research design. The results show that financial leverage of Canadian firms is influenced by the collateralized assets profitability effective tax rate firm size growth opportunities number of subsidiaries and industry dummy. This study contributes to the literature on the factors that influence financial leverage of the firm. The findings may be useful for financial managers investors and financial management consultants. JEL classification numbers G32 Keywords Firm size profitability financial leverage tax rate collateralized assets non-debt tax shield. 1 College of Business Administration Trident University International 5665 Plaza Drive CA 90630 USA e-mail agill@ 2 School of Business Administration Simon Fraser University 515 W. Hastings St Vancouver BC V6B 5K3 Canada e-mail nmathur@ Article Info Revised August 24 2011. Published online September 30 2011 20 Factors that Influence Financial Leverage of Canadian Firms 1 Introduction The purpose of this study is to find the factors that influence financial leverage of Canadian firms. Financial leverage in the context of this study is defined as the degree to which a firm utilizes borrowed money. Capital structure choices are the tough choices because higher leverage can lead to risk of bankruptcy. However this does not mean that financial leverage is always bad. Financial leverage can increase shareholders return on investment and often there are tax advantages associated with borrowing. .

• Tài chính doanh nghiệp
• Firm size
• Financial leverage
• Tax rate
• Collateralized assets
• Non debt tax shield
• Capital structure in corporate performance utilizing firm size
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• Manufacturing companies listed on the IDX
• Moderate capital structure
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• Selected manufacturing firm
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• Kenya Association of Manufacturer’s directory
• Audit firm size
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• Financial statements
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• Canadian manufacturing firms
• Firm growth
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• Gross domestic product
• Social responsibility
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• Corporate social responsibility disclosures
• Banking firms
• Evidence from Jordan
• The effect of solvency indonesian company
• The effect of firm size in Indonesian company
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• Audit report lag in Indonesian company
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• Cash positions to leverage of selected listed manufacturing firms
• Firm size of selected listed manufacturing firms in Nigeria
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• Foreign direct investment
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