THE CORRELATION BETWEEN STATEMENT OF CASH FLOWS, IAS 7, AND EARNINGS PER SHARE, IAS 33: A CASE STUDY AT DAIMLER AG (MERCEDES-BENZ)
THE CORRELATION BETWEEN STATEMENT OF CASH FLOWS, IAS 7, AND EARNINGS PER SHARE, IAS 33: A CASE STUDY AT DAIMLER AG (MERCEDES-BENZ)

Summary/Abstract: The present paper aims to examine the relationship between cash flows from operating, investing, and financing activities from one side, and earnings per share from the other, for Daimler AG (Mercedes-Benz) – one of the largest and oldest multinational automotive corporations in the world. The paper is based on the analytical and descriptive approaches, and tests the hypotheses of the study using the annual reports for the period of 2010–2020. The analysis of data is performed using the IBM-SPSS 25 statistical program in addition to Microsoft Excel 2013. This study uses the techniques of descriptive and inferential statistics. Based on the results, this paper concludes that there is no relationship between net cash flows and earnings per share; there is also no statistically significant correlation between cash flow from investing and earnings per share. Regarding the net cash flow from operating and financing, there is a statistically significant relationship between this independent variable and earnings per share; at the same time, the correlation is positive for financing activities but negative for operating activities with earnings per share. Multinational automotive corporations such as Daimler AG (Mercedes-Benz) should show a link between cash flows and earnings per share when making decisions related to operating and investing activities because the relative difference between the statement of cash flows and earnings per share is important for external users, especially investors.

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