股权融资外文翻译文献.docx

股权融资外文翻译文献.docx

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股权融资外文翻译文献

文献信息：

文献标题：

EquityFinancingandFinancialPerformanceofSmallandMediumEnterprisesinEmbuTown,Kenya（肯尼亚恩布镇中小企业股权融资与财务绩效研究）

国外作者：

IKNjagi，MEKimani，SNKariuki

文献出处：

《InternationalAcademicJournalofEconomicsandFinance》,2017,2（3）:

74-91

字数统计：

英文2793单词，15064字符；中文4590汉字

外文文献：

EquityFinancingandFinancialPerformanceofSmallandMediumEnterprisesinEmbuTown,Kenya

AbstractCapitalstructurecompriseofamixofdebtandequity.Managersusedvariouscombinationsofdebtandequitythatincreasesthenetworthofbusinessatthesametimereducesthecostofobtainingfinance.FinancialdecisionsaffectedthefinancialperformanceofSMEsbutvaryfromonefirmtoanother.Thisisduetothelimitedaccesstofinancesandabilityofthemanagertofullyutilizetheresourcesavailable.SMEsareofsignificancetotheeconomicdevelopmentofanystateregardlessofthedevelopmentstatus.DespitetheirimportanceSMEsarecharacterizedwithslowgrowthrateandthreeoutoffiveSMEsfailintheirfirstthreeyearsofoperation.ThecontinuedpoorperformanceshaveledtodeclineingrowthandeventuallydeathoftheSMEs.ThegrowthoftheSMEshighlydependedontheinvestmentdecisionsmadebytheentrepreneursandlackofaccesstofinanceshascreatedfinancialgapsthathavefueledthechallengesthatSMEsface.ThestudythereforeanalyzedtheeffectofequityfinancingonfinancialperformanceofSMEsinKenya.ThestudyrevealedthatSMEshadgreaterpreferenceforcontributionfromfriendsandploughingbackprofitasasourceofequityfinance.Angelinvestorsasaformofequityfinancinghasnotgainedacceptanceasasourceoffinance.FromthestudyitwasevidentthatequityfinancehadapositiverelationshiptofinancialperformanceoftheSMEs.

KeyWords:

capitalstructure,equity,financialperformance

INTRODUCTION

ThesignificanceofSmallandMediumEnterprisesinKenyawasfirstacknowledgedintheInternationalLaborOrganizationreportonEmployment,IncomeandEquityinKenyain1972.ThereportunderscoredSMEsasanengineforemploymentandincomegrowth.SMEscreateabout85percentofKenya’semployment[GovernmentofKenya（Gok,2009）].

DespitetheroleplayedbySMEs,theWorldBankReport（2010）suggeststhatoneofthemajorcausesofSMEsfailureislimitedaccesstofinances.Businessorganizationsaimtoimproveontheirproductionandoperationsefficiencyandtoincreasetheirprofitmargin.Anumberoffactorsmayinfluenceefficiencyandeffectivenessofbusinessoperationsincludingcapitalstructure.Thecapitalstructureofafirmisamixofdebtandequitythatafirmusestofinancebusiness.Thefinancemanageristhereforeconcernedwithacapitalstructurethatincreasestheprofitmarginatleastcost（Ehrhardt&Brigham,2013）.AccordingtoChepkemoi（2015）earlierstudiesongeneralsmallfirmcapitalstructurehavepresupposedsmallandmediumsizedenterprisesto（predominantly）actinsuchawayastomaximizetheirfinancialwealth.Aconsequenceofthispresuppositionisthat,thesestudieshaveassumedthatSMEs,ingeneral,desiresubstantialgrowthandconsequentlyhaveadesireforexternalfinance.

AcademicresearchhasdocumentedthattherearedifferencesinfinancingpatternsbetweenSMEsandlargefirmsandanalyzedpossiblecausesofthesedifferences（Elaine,Angelo,Ana&Ricardo,2005;Howorth,2001;Mac&Lucey,2010）.Theexistenceoffixedcostsduetoexternalfinancing,smallerfirmschoosetorefinancelessfrequentlythanlargerfirmsbecausetheyaremoreaffectedbythesefixedcostsinrelativeterms.Hence,smallfirmschoosetooperateatahigherleveragelevelatarefinancingmomenttocompensateforlessfrequentrebalancing.Thisargumentexplainswhysmallerfirms,iftheyhavesomedebt,aremoreleveredthanlargerfirms.Inaddition,asthetimeperiodbetweenrestructuringsislongerforsmallfirms,onaverage,theyhavelowerleverageratios（Chepkemoi,2013）.

Capitalstructurerepresentstheproportionaterelationshipbetweenthedifferentformsoflongtermfinancing（Varaiya,Kerin&Weeks,2007）.Makingappropriatedecisiononthefinancingoptionmaylooksimple,butsometimesitrequiretime.Managementisoftenfacedwithdilemmaonwhethertoobtainfundsfrominternalsources（retainedearnings）orexternalsourceswhichincludeloansfromfinancialinstitutions,tradecredit,andissuanceofequityshares.Thecreationofacapitalstructureinanyorganizationinfluencesthegovernancestructureofafirmwhich,inturn,hasdirectimpactonstrategicdecisionsmadebythemanagers（Mwangi,Makau&Kosimbei,2014）.

Managementhasnumerouscapitalstructurechoicesthattheymayadoptattheirdiscretion.Thechoiceofthetypeofcapitalstructuretobeadoptedmaynotmeanvaluemaximizationbutmaybefortheprotectionofthemanagementself-interest,especiall