Univrsity Of Tehran Press Accounting and Auditing Review 2645-8020 22 4 2016 01 21 Inflation, operating cycle, and cash holdings Inflation, operating cycle, and cash holdings 441 460 56246 10.22059/acctgrev.2016.56246 FA Sahar Sepasi Assistant Professor in Accounting, Tarbiat Modares University, Tehran, Iran Mohammad Esmaeili Kejani MSc.in Accounting, Tarbiat Modares University, Tehran, Iran Reza Safikhani MSc. Student in Accounting, Tarbiat Modares University, Tehran, Iran Journal Article 2015 04 25 A corporate cash-holding strategy is a trade-off between the costs and benefits of holding cash. At the macro level, firms are inclined to adjust their cash-holding strategies in response to inflation. At the micro level, the operating cycle, which indicates the turnover of corporate cash flow, is an effective corporate cash-holding strategy. This study investigates the effect of inflation and operating cycle on corporate cash holdings. To do so, a sample consisting of 1,264 Firm-year observations was gathered from Tehran Stock Exchange between 1385 and 1392. For hypothesis testing, Almeida, Campello and Weisbach (2004) model was used. The results of the study shows that as the inflation increases, the corporate cash holdings will decrease and when inflation reaches a certain point, the corporate cash holdings will go up as the inflation increases. Moreover, when operating cycle increases, corporate cash holdings decrease but when operating cycle reaches a certain point, the corporate cash holdings  stand still. A corporate cash-holding strategy is a trade-off between the costs and benefits of holding cash. At the macro level, firms are inclined to adjust their cash-holding strategies in response to inflation. At the micro level, the operating cycle, which indicates the turnover of corporate cash flow, is an effective corporate cash-holding strategy. This study investigates the effect of inflation and operating cycle on corporate cash holdings. To do so, a sample consisting of 1,264 Firm-year observations was gathered from Tehran Stock Exchange between 1385 and 1392. For hypothesis testing, Almeida, Campello and Weisbach (2004) model was used. The results of the study shows that as the inflation increases, the corporate cash holdings will decrease and when inflation reaches a certain point, the corporate cash holdings will go up as the inflation increases. Moreover, when operating cycle increases, corporate cash holdings decrease but when operating cycle reaches a certain point, the corporate cash holdings  stand still. https://acctgrev.ut.ac.ir/article_56246_164b6799ea23c9cdb5aa1e16dfd1d0cd.pdf