The growth of Finnish software companies in 2008-2011 empirical investigation of financial ratios as the determinants of growth

The purpose of this study is to examine the relation of growth and the financial ratios of a company. The theoretical portion of the study focuses on the concept of growth in entrepreneurship theory. The empirical portion consists of examination of the financial ratios of 162 Finnish software com...

Täydet tiedot

Bibliografiset tiedot
Päätekijä: Kaasalainen, Mikko
Muut tekijät: Kauppakorkeakoulu, School of Business and Economics, Taloustieteet, Business and Economics, University of Jyväskylä, Jyväskylän yliopisto
Aineistotyyppi: Pro gradu
Kieli:eng
Julkaistu: 2014
Aiheet:
Linkit: https://jyx.jyu.fi/handle/123456789/43566
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author Kaasalainen, Mikko
author2 Kauppakorkeakoulu School of Business and Economics Taloustieteet Business and Economics University of Jyväskylä Jyväskylän yliopisto
author_facet Kaasalainen, Mikko Kauppakorkeakoulu School of Business and Economics Taloustieteet Business and Economics University of Jyväskylä Jyväskylän yliopisto Kaasalainen, Mikko Kauppakorkeakoulu School of Business and Economics Taloustieteet Business and Economics University of Jyväskylä Jyväskylän yliopisto
author_sort Kaasalainen, Mikko
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description The purpose of this study is to examine the relation of growth and the financial ratios of a company. The theoretical portion of the study focuses on the concept of growth in entrepreneurship theory. The empirical portion consists of examination of the financial ratios of 162 Finnish software companies in 2008-2011 by means of quantitative analysis methods. Statistical analysis methods, including analysis of variance, correlation and regression analysis, are used in the analysis. The objective of the study is to reveal how growth affects the financial ratios of a company and which ratios can be used to predict growth. The effects of companies’ age, geographical location and industrial classification on their financial ratios are also examined. The findings of this study reveal that the Finnish software industry inhabits a considerably high amount of growth companies. Younger companies were found to exhibit higher growth rates and absolute profitability than older ones. The findings suggest that a heightened level of cash is tied to the operations of companies exhibiting an especially slow or fast rate of growth. Companies exhibiting high growth were found to produce high levels of return on investment, but high growth was also found to put a company’s short term profitability and liquidity at risk. Only weak correlations were found between growth and the financial ratios of a company. The regression analysis revealed that a model combining 10 financial ratios may be used to predict the net sales growth of a company. Implications and future research proposals are provided.
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The theoretical portion of the study focuses on the concept of growth in\r\nentrepreneurship theory. The empirical portion consists of examination of the financial\r\nratios of 162 Finnish software companies in 2008-2011 by means of quantitative analysis\r\nmethods. Statistical analysis methods, including analysis of variance, correlation and\r\nregression analysis, are used in the analysis. The objective of the study is to reveal how\r\ngrowth affects the financial ratios of a company and which ratios can be used to predict\r\ngrowth. The effects of companies\u2019 age, geographical location and industrial classification\r\non their financial ratios are also examined.\r\n\r\nThe findings of this study reveal that the Finnish software industry inhabits a\r\nconsiderably high amount of growth companies. Younger companies were found to\r\nexhibit higher growth rates and absolute profitability than older ones. 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spellingShingle Kaasalainen, Mikko The growth of Finnish software companies in 2008-2011 : empirical investigation of financial ratios as the determinants of growth Entrepreneurship growth entrepreneurship financial ratio analysis financial ratios Yrittäjyys Kvantitatiivinen tutkimus 20422 yrittäjyys kasvuyritykset ohjelmistoala ohjelmistoteollisuus tunnusluvut
title The growth of Finnish software companies in 2008-2011 : empirical investigation of financial ratios as the determinants of growth
title_full The growth of Finnish software companies in 2008-2011 : empirical investigation of financial ratios as the determinants of growth
title_fullStr The growth of Finnish software companies in 2008-2011 : empirical investigation of financial ratios as the determinants of growth The growth of Finnish software companies in 2008-2011 : empirical investigation of financial ratios as the determinants of growth
title_full_unstemmed The growth of Finnish software companies in 2008-2011 : empirical investigation of financial ratios as the determinants of growth The growth of Finnish software companies in 2008-2011 : empirical investigation of financial ratios as the determinants of growth
title_short The growth of Finnish software companies in 2008-2011
title_sort growth of finnish software companies in 2008 2011 empirical investigation of financial ratios as the determinants of growth
title_sub empirical investigation of financial ratios as the determinants of growth
title_txtP The growth of Finnish software companies in 2008-2011 : empirical investigation of financial ratios as the determinants of growth
topic Entrepreneurship growth entrepreneurship financial ratio analysis financial ratios Yrittäjyys Kvantitatiivinen tutkimus 20422 yrittäjyys kasvuyritykset ohjelmistoala ohjelmistoteollisuus tunnusluvut
topic_facet 20422 Entrepreneurship Kvantitatiivinen tutkimus Yrittäjyys financial ratio analysis financial ratios growth entrepreneurship kasvuyritykset ohjelmistoala ohjelmistoteollisuus tunnusluvut yrittäjyys
url https://jyx.jyu.fi/handle/123456789/43566 http://www.urn.fi/URN:NBN:fi:jyu-201405271841
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