The Impact of Cash Flow Statement of Listed Firms on the Decision of Investors

Abstract

This resarch is conducted for investigating the impact of cash flow statements on investors' decisions in an inefficient information market like Vietnam. Data were collected from the opinion of 150 investors in the stock market in which 75 investors received information on cash flow statement and 75 investors did not receive information of cash flow statement. We employ descriptive statistics and T-tests to examine the impact of cash flow statements on investors' decisions as well as investor confidence in the lack of information of cash flow statement. The results show that cash flow statement had no effect on investors' decisions but the lack of information on the cash flow statement reduced the confidence in making decisions. Based on the findings, some recommendations are given to investors who need to pay more attention to the cash flow statement in making decisions, and for firms that need to pay more attention to the supply information on cash flow statement.

Keywords: Cash flow statement, Decision of the Investor, Inefficient market

DOI: 10.7176/RJFA/10-8-10

Publication date: April 30th 2019