Investigating the Role of the Impact of Business Strategy on the Cash Policies of Companies Listed on the Tehran Stock Exchange

The importance of cash in a business unit is one of the most fundamental events on which accounting measurements are based. Managers usually search for a level of cash that is optimized taking into consideration the advantages and disadvantages of maintaining cash. Managers strive to achieve an optimal level of cash retention. Accordingly, how quickly optimal cash is achieved is an important issue in financial research literature. Therefore, the purpose of this study was to investigate the effect of business strategy on company cash policies. For this purpose, a sample consisting of 168 companies were selected from the companies listed on the Tehran Stock Exchange during the years 2015 to 2019. To test the research hypotheses, a multivariate regression model based on composite data using panel data method was used. The results of the analysis of research hypotheses showed that there was a positive and significant relationship between offensive strategy and cash retention while there was a negative and significant relationship between offensive strategy and the speed of cash adjustment. In addition, there was a negative and significant relationship between defensive strategy and cash retention, but there was a positive and significant relationship between defensive strategy and the speed of adjustment of cash retention.