The Relationship between Retained Earnings to Total Assets and Corporate Performance

• Main Authors: Hunag, Wei-Jiun, 黃威鈞
• Other Authors: Wang, Sue-Fung
• Format: Others
• Language: zh-TW
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/41161780162358369447

碩士 === 國立交通大學 === 經營管理研究所 === 104 === Nowadays, people gradually take respect on the corporate sustainable operation since the event of Eron in 2001. It’s unbelieve that a huge company such could corrupt in overnight. People start to doubt for the corporate sustainable operation even the company which was survive more than hundred years. After 2007, the finance crisis was broke out, again show that the company like Lehman Brothers bankrupted in a flash. So the research start from Altman’s Z-SCORE model which is used for estimating the bankrupt risk of company and we want to know that exactly important factors with performance of company and growth power. In Altman’s Z-SCORE model, it shows some factors such as side of retained earnings, side of profit, and side of liquidity. To manage a company in efficient way is a responsibility for CEO. So the performance of company and growth power are important issues to control. Owing to the problem of bankrupt events frequently pop up today, this research will focus on the important factor between performance and growth power. After review the precedent essays and research on this issue, we conclude that four sides of factors about performance and growth momentum, there are growth power, dividend payment policy, profit ability, asset operating effectivity and liability structure. In the growth power we include the same factor in Altman’s Z-SCORE is retained earnings to total assets. This ratio not only can reveal the ability of dividend payment, but also can be deemed as a potential growth ability. The retained earnings to total assets is the ratio of internal capital can be used in some urging time and the opportunity of investment which have positive NPV. In the end of research find out there have positive relationship between performance and retained earnings to total assets and also have the same result in growth momentum.