• Journal of the Korea Academia-Industrial cooperation Society
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• v.4 no.3
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• pp.289-295
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• 2003

In this paper, the option valuation of venture business was calculated by utilizing growth option model, chosen from real option valuation method. The evaluation of venture business was estimated by adding option value to the terminal value discounted from cashflow method. As the result of the empirical analysis, ROV model applied in the Study is more reliable Han the DCF model concerning the pricing of venture business. Unlike the previous study of Schartz & Moon which only analyzed one venture business, this study estimated and analyzed the rational pricing of venture business with comparative methods using various parameters of sampling 99 domestic venture businesses.

• Asia-Pacific Journal of Business
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• v.13 no.4
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• pp.109-121
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• 2022

Purpose - This study investigates how earnings volatility influences current stock price informativeness about expectations of future earnings. Design/methodology/approach - I adopt the FERC model developed by Collins et al. (1994) and modified by Lundholm and Myers (2002) to investigate the connection between earnings volatility and future earnings reflected in current returns. I define five-year rolling standard deviations of earnings and components as earnings volatility measures and the degree of deviation of earnings from cash flows over the same five-year, which is developed by Jayaraman (2008). Finding - My results show that earnings volatility delays current stock price response to future operation expectations. They also verify that as earnings are more divergent from cash flows, current returns are less timely incorporating value-relevant future operation. Research implications or Originality This study shows that when volatile earnings deliver obscure and unreliable information about future operation expectations, they cause the market to be conflicting in understandings their implications and make it difficult in attaining correct future cashflow estimates.

• The Journal of the Korea Contents Association
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• v.15 no.7
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• pp.436-448
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• 2015

This study examined one of the contemporary financial aspects, the level of corporate cash holdings for the firms belonging to the chaebols in the Korean capital markets. Being accompanied by various alternative econometric methodologies such as static and dynamic panel data model, stepwise OLS, and Fama-Macbeth modelm this research extended the preceding Kim's study (2015) in anticipation of validating the results to identify any financial factors which may significantly affect the chaebol firms' cash reserves. Several financial characteristics such as CASHFLOW, MVBV, REINVEST, and AGENCY, were found to be statistically significant factors on the level corporate liquidity, along with CCC as cash conversion cycle in the models. It may be plausible that any outcomes of this study may be applied to enhance the efficiency of financial strategies of the chaebol firms on cash holdings, thereby expediting the development of the domestic capital markets status quo toward the advanced one in the market classification.

• Proceedings of the Korean Institute Of Construction Engineering and Management
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• 2006.11a
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• pp.295-300
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• 2006

In this research, risk factors which can raise project cost are identified in the initial stage and picked out through the decision maker's baseline. And also this probable risks are implemented to the project cash flow to estimate the contingency and to build a risk management system in the level of project. The risks that affect the projects profits were classified in two categories in the risk checklist. Firstly, financial risks derived from the external economic conditions for example exchange rate, escalation, interest rates etc. are analyzed through the stochastic methods, Monte-Carlo Simulation. Secondly, the project individual risks which are come from the project characteristics, for example country risk, clime, owner etc., are evaluated using the utility curve of the decision maker. Finally these risk analysis methods are used to forecast the actual project cash flow and final profit.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.16 no.6
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• pp.3870-3881
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• 2015

This study examined one of the contemporary issues on debate to identify any significant financial determinants on the cash holdings of the cheabol firms in the Korean domestic capital markets. Several important findings on the financial characteristics affecting the cash holdings were evidenced by utilizing various methodologies for statistical estimations. Financial or managerial implications with discussion were provided for the pronounced factors such as CASHFLOW, MVBV, REINVEST, and AGENCY. Assuming that the chaebol firms were overall subject to the financial constrains, they may increase or stockpile cash reserves as internal capital for future investment opportunities or repayment of existing debt, rather than external financing burdened by a high cost of capital. Given the on-going controversy on the optimal level of corporate cash holdings coupled with any foreseeable capital transfer among the associated nations through the investment vehicles such the FTAs (Free Trade Agreements) or TPP (Trans-Pacific Pacts), any empirical findings of the study may shed new light on identifying financial determinants which may significantly affect the level of cash holdings for the business conglomerates, the 'chaebol' firms, in the Korean capital markets.

• Asia-Pacific Journal of Business Venturing and Entrepreneurship
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• v.11 no.3
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• pp.1-15
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• 2016

This study has analyzed predication capabilities leveraging multi-variate model, logistic regression model, and artificial neural network model based on financial information of medium-small sized companies list in KOSDAQ. 83 delisted companies from 2009 to 2012 and 83 normal companies, i.e. 166 firms in total were sampled for the analysis. Modelling with training data was mobilized for 100 companies inlcuding 50 delisted ones and 50 normal ones at random out of the 166 companies. The rest of samples, 66 companies, were used to verify accuracies of the models. Each model was designed by carrying out T-test with 79 financial ratios for the last 5 years and identifying 9 significant variables. T-test has shown that financial profitability variables were major variables to predict a financial risk at an early stage, and financial stability variables and financial cashflow variables were identified as additional significant variables at a later stage of insolvency. When predication capabilities of the models were compared, for training data, a logistic regression model exhibited the highest accuracy while for test data, the artificial neural networks model provided the most accurate results. There are differences between the previous researches and this study as follows. Firstly, this study considered a time-series aspect in light of the fact that failure proceeds gradually. Secondly, while previous studies constructed a multivariate discriminant model ignoring normality, this study has reviewed the regularity of the independent variables, and performed comparisons with the other models. Policy implications of this study is that the reliability for the disclosure documents is important because the simptoms of firm's fail woule be shown on financial statements according to this paper. Therefore institutional arragements for restraing moral laxity from accounting firms or its workers should be strengthened.

• The Korean Journal of Financial Management
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• v.27 no.1
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• pp.181-208
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• 2010

In July 2007, Korean government has passed "The Capital Market and Financial Investment Services Act" to further develop the capital markets and the Act was to become effective in February 2009. Using a large sample of Korean firms, we have examined (i) the effect of underwriting activities on the firm value (bond spread) comparing commercial bank and investment bank, and (ii) the determinants of the firm value changes following underwriting activities of bank. To test our goal, we collected a wide range of samples of data for bond issuing activities executed by Korean firms listed on the Korea Stock Exchange (KSE) between 2000 and 2003. Our paper is distinguished from previous studies on this subject in a way that we analyzed the effect of corporate bond underwriting activities with regard to commercial banking and investment banking. Initially, we set up a hypothesis that "Certification View" and "Conflict-of-interest View" are major driving forces behind cross-firm differences in performance following bond issuance. We find that, in general, underwriting by investment bank (securities company) brings a positive effect on the firm value (spread between bench mark rate and bond issuing rate). This result indicates that firm value has been negatively affected by the bank underwriting and provides the evidence for "Conflict-of-interest View" in Korea. Our studies have also revealed that any change in firm value following bond issuance is positively related with the firm size (total asset), operating performance, liquidity (cashflow), and equity ownership by foreign investors. Overall, our results support the view that bank underwriting activities can play an important role in determining firm value and financial strategies under "The Capital Market and Financial Investment Services Act" of 2007.