1- Department of Accounting, SR.C., Islamic Azad University, Tehran, Iran
2- Department of Financial Management, SR.C., Islamic Azad University, Tehran, Iran , hamidrezavakilifard@iau.ac.ir
3- Department of Financial Management, SR.C., Islamic Azad University, Tehran, Iran |
The present study aims to develop a risk model for cash holdings under conditions of economic uncertainty. This qualitative research is applied in terms of objective and exploratory in terms of strategy, employing the grounded theory approach. The statistical population comprised 30 managers, specialists, and experts in the fields of financial management, economics, and investment, from whom a theoretical sample was selected, and interviews were continued until theoretical saturation was achieved. The qualitative findings, following the screening of initial coding, led to the identification of 118 open codes. Subsequently, through the comparison and categorization of similar codes, 66 axial codes were extracted. In the selective coding stage, these were organized into 5 main categories based on the paradigmatic model (comprising causal conditions, contextual factors, intervening conditions, strategies, and consequences). The results indicate that severe uncertainty in economic policies (monetary, fiscal, exchange rate, trade, and government unpredictability), serving as causal conditions, influences the motives for holding cash (precautionary and transactional) and behavioral patterns. This, in turn, gives rise to dual consequences in the form of excess cash risks (opportunity costs and misappropriation) and shortage risks (operational and liquidity problems). Furthermore, economic uncertainty induces cash flow volatility, elevates the cost of capital, restricts access to financing, and leads to a decline in market value. Meanwhile, contextual and intervening factors—such as firms' structural characteristics, corporate governance quality, managerial characteristics, and the level of access to financing—play a moderating role. In response to the aforementioned conditions, firms adopt strategies such as active cash risk management and diversification of financing sources. These strategies, in turn, influence overall risk, financial performance, and market value, underscoring the necessity of achieving an optimal level and a dynamic balance. Finally, the study emphasizes enhancing information transparency and improving predictive capability in financial reporting related to cash holdings as key approaches.
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