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UTAR (n.d) defined dividends are cash payments
that public companies pay a significant percentages of company’s earning to
their shareholders. Bergmann (2016) had figured out that dividend payments paid Australian
listed companies among large resources companies and banks have growth and
increased substantially after global financial crisis. The aggregate trends of
Australian listed companies dividend payout ratio has evolved into three
stages. The first stage of dividend history was falling during 2003 to 2007 as
the growth in dividends were not strongly than earnings because it considered
as an early high-investment stages of the resources boom during that period. Bergmann
(2016) also pointed out the reasons of falling in the payout ratio
during the first stage because resources companies s largely using retained earnings
rather than other sources of funding to finance the corresponding resources
investment boom over this period. At the second stage, the trend of dividend
rising temporarily and seems not to be affected by the global financial crisis
happened in Australia during 2008. Since 2010 after the global financial
crisis, the dividends payout ratio have rising and increased significantly while
earnings have been in recent years. Based on research done by Liyu
(2015), he stated that Australian listed companies has decreased the proportion
of dividend distribution from 46.4% in 1997 to 31.1% in 2014. Besides,
Australian listed companies’ dividends are the highest (67) compared to United
Kingdom (60), Japan (57), Europe (55) and others accordance to
average international dividend payout ratios from 2005 to 2015. This mainly due
to the Australia’s system of dividend imputation and the effect of tax
policies. While in recent year 2015, Australian listed companies have distributed
$78 billion of dividends to shareholders and represented that 81% of listed
companies’ underlying earnings at the same period (Bergmann, 2016). 

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