Jakman

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Vol. 7 No. 4 (2026): September

Articles

Does Firm Size Strengthen the Effect of Liquidity on Corporate Cash Holding?

B Beny Beny E Erika Jimena Arilyn W Wahyuni Rusliyana Sari S Silvy Christina
02 September 2026 Vol. 7 No. 4 (2026): September https://doi.org/10.35912/jakman.v7.n4.p243-256.2026
Abstract
02 Sep 2026

Purpose: This study investigates the direct effect of non-cash working-capital liquidity on corporate cash holdings and evaluates whether firm size acts as a moderating variable within the liquidity-intensive property and real estate sector listed on the Indonesia Stock Exchange.
Research Methodology: A quantitative explanatory approach using panel data was conducted on 42 property and real estate firms (252 firm-year observations) listed from 2018 to 2023. Data were analyzed using regression analysis by EViews 12 software.
Results: Statistical findings demonstrate that liquidity has a significant negative direct effect on cash holdings. Importantly, firm size significantly moderates the relationship between liquidity and cash holding in a positive direction, confirming its role as a pure moderator that attenuates liquidity substitution behavior.
Conclusions: Organizational scale fundamentally alters corporate liquidity management; while smaller firms substitute non-cash liquidity for physical cash, larger enterprises leverage superior credit access and scale advantages to accumulate internal liquid reserves alongside working capital growth.
Limitations: The scope is limited strictly to audited financial disclosures of property and real estate companies in a single emerging market over a six-year period, unobserving qualitative governance factors.
Contributions: The study provides financial managers with insights to optimize cash conversion cycles and offers Investors and Regulators (Otoritas Jasa Keuangan-OJK) a diagnostic scale-adjusted framework for evaluating corporate liquidity risk

Keywords: Cash Holding Firm Size Liquidity Trade-Off Theory Pecking Order Theory
How to Cite
“
Beny, B., Arilyn, E. J., Sari, W. R., & Christina, S. (2026). Does Firm Size Strengthen the Effect of Liquidity on Corporate Cash Holding?. Jurnal Akuntansi, Keuangan, Dan Manajemen, 7(4), 243–256. https://doi.org/10.35912/jakman.v7.n4.p243-256.2026
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