Abstract:
Cash flow can provide information about the company's ability to generate cash and cash equivalents. The higher the value of a cash, the company's ability to pay off short-term debt is also high. Vice versa, the lower the value of a cash, the ability of companies to pay off short-term debt is also low. This study aims to examine the effect of cash flows on changes in liquidity. This research was conducted at the Automotive and Components sub-sector manufacturing companies listed on the Indonesia Stock Exchange (IDX) for the 2014-2018 period. The number of observations of 10 companies as research samples obtained using purposive sampling technique. The analysis technique used in this study is panel data regression analysis. The analysis shows that earnings have a positive but not significant effect on changes in liquidity. This shows that if the earnings variable increases, stock returns increase, and vice versa if the value of earnings decreases, liquidity will decrease. Working capital from operations, current ratio has a positive and significant effect on changes in liquidity. This shows that if working capital from operations, current ratio rises, liquidity will also increase and vice versa. The variable cash flow from operations has a negative but not significant effect on changes in liquidity. This shows that if the cash flow from operations variable rises, liquidity will decrease and vice versa. And for the variable quick ratio & cash conversion cycle gives a negative and significant effect on changes in liquidity. This shows that if the quick ratio & cash conversion
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cycle variable increases, the value of liquidity will go down, and so should the value of the quick ratio & cash conversion cycle decrease, the liquidity will rise.
