A Study On The Influence Of Free Cash Flow,Corporate Governance And Expense Stickiness

The effective control of the cost management,can improve the core competitiveness of enterprises,and help management make scientific decisionThe traditional cost theory,define that cost has a linear relation with traffic,but the latest empirical research shows that the change of cost and income is not symmetrical.When higher volumes increase cost is greater than the volume of an equal low cost reduction,academia defined this economic phenomenon as the viscosity.In recent years,the cost stickiness has become a hot topic in management accounting research,domestic and foreign scholars have carried out a series of studies on the stickiness of cost.On the basis of agency theory,this paper review the related literature,explores the managers based on self-interest to manipulation of free cash flow,so as to strengthen the cost of the enterprise viscosity;Then we discuss the internal governance mechanism reduced the cost stickiness by alleviating agency problem.Finally,on the basis of theoretical analysis,this paper selects 2012-2016 A-share manufacturing companies in Shanghai and Shenzhen stock exchange as research samples,discussed the following questions:(1)If the fee stickiness exist in the manufacturing companies;(2)The effect of free cash flow on the fee stickiness;(3)In the different case of free cash flow,if the influence of internal governance factors on fee stickiness exist distinction.The empirical results show that there is a cost stickiness in manufacturing companies.Free cash flow promotes the cost stickiness;And there has a positive correlation between the stock equity concentration degree and the cost stickiness,while the equity balance degree has a inhibitory effect on the cost stickiness.Good board governance and management incentives can effectively reduce the cost stickiness.