Journal of Research Administration

Abstract

This study examines the relationship between cash flow volatility and trade credit among firms listed on the Vietnamese stock market. Employing Feasible Generalized Least Squares (FGLS) and System Generalized Method of Moments (System GMM) estimations on a panel dataset of 581 non-financial firms over the period 2015–2024, the results indicate that cash flow volatility is negatively associated with accounts receivable. This finding remains robust across a range of robustness checks, including the use of alternative proxies for both explanatory and dependent variables, controls for macroeconomic factors, and alternative model specifications. In addition, the results reveal that the cash conversion cycle attenuates the negative impact of cash flow volatility on accounts receivable, whereas cash holdings amplify this adverse relationship. These findings underscore the critical role of cash flow risk in shaping firms’ trade credit policies.