Earnings and Cash Flow Persistence - Case of Medium Agriculture Enterprises in Serbia

Stevanović, Slavica and Minović, Jelena and Marinković, Grozdana (2021) Earnings and Cash Flow Persistence - Case of Medium Agriculture Enterprises in Serbia. Economics of Agriculture, 68 (1). pp. 141-153. ISSN 0352-3462

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Abstract

This paper examines the earnings and cash flow persistence of selected agriculture Serbian enterprises as a measure of their earnings quality. We study the persistence of income statements and cash flow statement items of medium-sized agriculture enterprises in Serbia. Agriculture is a relevant sector for the national economy and medium-sized enterprises are the main drivers of her economic growth. We use panel regression analysis with annual data over the period from 2010 to 2018. The results of our research indicate that earnings and cash flow-based indicators have different persistence. Analysing accruals and net cash flows of operating activities as determinants of operating profit of analysed enterprises, we conclude that operating profit that represents accruals are more persistent than operating profit backed by net operating cash flows.

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