Cause And Strategies Analysis Of Cash Flow Drying Up

In the financial storm,a lot of corporates faced bankruptcy due to the cash flow drying up. Entering the after-financial crisis era, survived corporates is also facing a shortage of cash,slow turnover of cash flow, the damage of the firm value and even the risk of the cash flow drying up.Thus, cash flow played a significant role in the business sustainable operations, smooth cash flow is directly related to the survival of enterprises. Therefore, to find the reason of cash flow drying up and to get the policy recommendations is very important, it not only riches cash flow research in theory, but also gives the support and help to the corporates in practice.So it is undoubtedly a very worthy study.Throughout the research of domestic and foreign scholars,the main reasons of cash flow drying up are the impact of the external macro environment and internal factors that result in in management loopholes,such as the fast expansion, investment mistakes, arbitrary guarantees, abnormal related transactions, lack of balance mechanism,illegal operations and so on. But these are the surface reasons,That results in these reasons is what we need to study. We see that cash flow drying up was almost happened in private enterprises recent years, is this occasional or inevitable, is private enterprises’cash flow risk higher, whether the nature of property rights affect the risk of cash flow drying up, whether the external environment affects the relationship between nature of property rights and cash flow drying up.The impact of nature of property rights and financial eco-environment to cash flow drying up is studied in this paper. Based on theoretical analysis and data of Chinese listed companies, the impact of nature of property rights and financial eco-environment to cash flow drying up is tested by multiple linear regression model firstly. Then, the sample corporate are divided into two parts-private enterprises and state-owned enterprises to test the impact of nature of property rights and financial eco-environment to cash flow drying up comprehensively.Conclusions are as follows:private enterprises’risk of cash flow drying up is lower.financial eco-environment is negative correlation with cash flow drying up. private enterprises are more sensitive to eco-environment change, the ability of them to resist risk is low.