Empirical Study On Accounts Payable Target Adjustment Of Chinese Listed Firms

Chinese scholars have been more focus on the study of accounts receivable, the research on accounts payable is relatively lacking. With the development of economy and society, accounts payable as a way of credit payment has become more and more important in the enterprises’daily business activities. Therefore, the research on the influencing factors of enterprises’accounts payable and the process of dynamic adjustment to target level of accounts payable is a meaningful subject.Based on the sample data of1171listed companies during2007-2011, author establishes the dynamic adjustment model of accounts payable and uses the generalized method of moments to estimate the coefficients. According to the empirical results, author proposes some reasonable suggestions to improve the management of enterprises’accounts payable.Empirical test results show that the listed companies in China will follow a kind of dynamic adjustment process which is the level of accounts payable adjusts toward its target level. Because of some adjustment costs, the dynamic adjustment is just a partial adjustment. The size of the enterprise, net profit margin, sales growth rate, current assets ratio and ratio of liabilities to assets are significantly positively related to accounts payable. And net profit of enterprises, short-term bank loans ratio and long-term debt ratio are significantly negatively related to accounts payable. There is no significant relationship between the years of establishment of enterprise and accounts payable.