What is financial analysis? Analysis of the financial activities of the enterprise

An obligatory component of financial management of any company. The purpose of such an analysis is to determine what the state of the company is today, which operating parameters are acceptable and need to be maintained at the current level, and which are unsatisfactory and require prompt intervention. In other words, in order to successfully move on, you need to know why the condition of the enterprise has deteriorated and how to correct the current situation (which control levers to use for this most effectively).

Financial analysis includes:

1. Analysis of financial position

• 1.1. Structure of the enterprise’s property and sources of its formation
• 1.2. Estimation of the net asset value of an enterprise
• 1.3. Determination of unsatisfactory balance sheet structure
• 1.4. Analysis of the financial stability of the enterprise
  • 1.4.1. Analysis of financial stability based on the amount of surplus (shortage) of own working capital
  • 1.4.2. Analysis of other indicators of the financial stability of the enterprise
• 1.5. Liquidity analysis
  • 1.5.1. Analysis of the ratio of assets by degree of liquidity and liabilities by maturity
  • 1.5.2. Calculation of liquidity ratios

2. Performance analysis

• 2.1. Review of the enterprise's performance results
• 2.2. Cost-benefit analysis
• 2.3. Calculation of business activity indicators (turnover)

3. Conclusions based on the results of the analysis

• 3.1. Assessment of key indicators
• 3.2. Final assessment of the financial condition and performance of the enterprise

When conducting financial analysis, we look at the client's business through the eyes of a potential investor or financier. We calculate such financial ratios as: ratios of liquidity, business activity, profitability, solvency and market activity.

There are standards for the above coefficients. Using them, we evaluate the performance of the client’s business. Next, we give recommendations for changing the structure of financial flows. These events help the management and owners of the enterprise to better see the strengths and weaknesses of the business, improve the structure of financial indicators, which contributes to the improvement and efficiency of the business as a whole.

One of the tasks of financial analysis is also to prevent the threat of bankruptcy. The independence of enterprises defined by the Civil Code of the Russian Federation and, in connection with this, their increasing responsibility to creditors, shareholders, banks, and employees, necessitates the need to pay attention to the issues of predicting the possible bankruptcy of enterprises. On the other hand, enterprises must be confident in the reliability and economic solvency of their partners or promptly use the bankruptcy mechanism as a means of repaying debt by insolvent partners, which becomes important in modern conditions with the existing problem of non-payments between enterprises.

In this regard, heads of enterprises and managers at various levels must be familiar with bankruptcy procedures and be able to determine the financial position of counterparty enterprises based on a well-conducted financial analysis. At the same time, it is necessary to carry out anti-crisis diagnostics of the financial condition of the enterprise in order to avoid possible bankruptcy.

Argo-Audit LLC provides the following services in the field of crisis management, for the following types of work and services:

• financial and economic services;
• support of insolvency procedures.

Financial and economic services include the following types of work:

• conducting financial analysis of the activities of debtor enterprises;
• conducting examinations on the presence (absence) of signs of fictitious and/or deliberate bankruptcy;
• development of external management plans.

Support of insolvency procedures includes the following types of work:

• consultations and services on preparing and sending to the arbitration court an application from a creditor (debtor) to declare the debtor insolvent (bankrupt);
• services for preparing reports of insolvency practitioners based on the results of insolvency procedures;
• preparation of opinions on the actions of the manager (orbitration manager) regarding the implementation of approved financial recovery plans (external management, liquidation);
• preparation of opinions on the adoption of other management decisions provided for by law.

The sale of property of debtor enterprises involves the sale of the debtor's enterprise or part of the debtor's property (including property rights, claims) at auction.

The financial analysis - analytical study of an enterprise's ability to finance its activities.

Subject of financial analysis– economic processes and financial results of the organization’s activities, formed under the influence of various external and internal factors and forming a system of analytical, financial, economic and other information.

Target analysis is to establish and evaluate the financial condition of the enterprise and constantly carry out work aimed at improving it.

FA tasks:

Assessment of the composition and structure of financial resources;

Determination of factors and causes of the achieved state;

Identification of reserves to improve the financial condition of the enterprise and increase operational efficiency.

Objects financial analysis are: industrial enterprises, joint-stock companies, trade organizations, credit institutions and other business entities, as well as specific financial and economic indicators (liquidity, profitability, financial stability).

Subjects financial analysis are leaders, managers at different levels, authorized to make and implement management decisions.

Financial analysis is necessary to identify and eliminate shortcomings in the financial activities of the enterprise and find reserves for improving the financial performance program. With the help of analysis, it is possible to develop the most reliable assumptions and forecasts for the future financial conditions of the enterprise.

1. Types of financial analysis.

The classification of types of financial analysis is based on the following characteristics:

Time– prospective (forecast) analysis, operational analysis, current (retrospective) analysis based on the results of activities for a particular period. To solve possible problems in a specific situation in the future, situational (momentary, one-time) analysis is used;

Current characterizes the economic activity already carried out.

Prospective analysis is an analysis of the performance of a business entity in the future. The prospective analysis builds on the results of the current analysis and can be considered as a continuation of it. Prospective analysis is very close in essence and methods to planning and forecasting.

Operational analysis, like the current one, is based on facts that have already happened. It differs from 1 in that it uses more timely data from primary accounting and personal observation. Natural indicators are more often analyzed. Its main task is to quickly identify changes in production and reserves for improving the current state.

Extent of information use– internal management and external analysis. External analysis is carried out on the basis of public financial and statistical reporting by creditors, investors and other entities.

For internal financial analysis, the subject is the management of the enterprise itself, and the information used is obtained both by summarizing primary accounting data and data obtained during special research. Such information is most often a trade secret.

You will learn:

• What is the main task of financial analysis in an enterprise.
• What types of financial analysis can be used in an enterprise.
• What are the stages of a financial analysis of a company?
• What mistakes are usually made in the financial analysis of an enterprise.

Financial analysis of the enterprise is a set of procedures and methods for an objective assessment of the state of an enterprise and its economic activities. The basis for the conclusions is quantitative and qualitative accounting information. It is after its monitoring that decisions are made.

Analysis and financial diagnostics of an enterprise involves carrying out activities aimed at:

• study of economic processes and their connections with each other - arise due to the fact that objective economic laws, subjective factors appear and influence general processes;
• scientific substantiation of plans, making management decisions and objective assessment of the results of their implementation;
• identification of positive and negative factors affecting the company’s performance;
• disclosure of trends and proportions of development of the organization, identification of unused reserves and resources in the economy;
• generalization of best practices and development of proposals related to their use in practice by an individual company.

Analysis of the financial results of an enterprise makes the management of monetary resources more efficient, identifies trends in their use, and develops forecasts for the company's development for the near future and for the future.

You should not think that an analysis of the financial and economic activities of an enterprise will help establish the exact reason why it is at risk of failure. But at the same time, only this process will help to correctly determine why the company “fell ill” and what the nature of the diagnosis is. With the help of analysis, you will be able to find out about the most vulnerable areas in the company’s economy and.

When using methods of financial and economic analysis, it is possible not only to identify the key factors influencing the financial and economic condition of the company, but also to measure the degree of such influence.

Goals and objectives of financial analysis of an enterprise

Financial analysis is carried out with main goal - assess internal problems in order to develop, justify and make decisions on development, recovery from a crisis situation, transition to bankruptcy, purchase and sale of a business or stake, and attraction of borrowed funds (investments).

This requires solving the following tasks:

1. Assessing the implementation of the plan for the receipt of cash resources and their distribution from the point of view of improving the financial situation in the company - the basis for the assessment is the study of the relationship between performance indicators of a financial, production and commercial nature.
2. Forecasting economic profitability and financial results, taking into account the real situation in which the organization’s activities are located, the presence of borrowed and personal resources and developed models of monetary status (despite the fact that there are various options for using resources).
3. Development of certain activities, the purpose of which is to use monetary assets more efficiently and strengthen the financial condition of the company.

Companies collect vast amounts of customer data, which ultimately turns out to be useless. The information is scattered, often outdated or distorted - on this basis it is impossible to make a unique selling proposition to the buyer and predict sales. Our article describes tools for collecting and analyzing information, the use of which:

• optimizes the company's marketing expenses;
• will help build a sales strategy;
• will reduce customer churn due to improved service quality.

Financial analysis of the enterprise: 5 types

External analysis. It is carried out to compare the company's performance with that of other enterprises based on data from the accounting reports of the counterparty company. The purpose of financial analysis of an external enterprise is to determine the market value and investment attractiveness of the company for possible contracts.

Internal analysis. The purpose of financial analysis of an internal enterprise is to study the activities of exclusively the business entity that is being analyzed. During it, they also use the system of economic activity standards developed by the company. In addition, information related to the company's trade secrets is used. An analysis of the financial performance indicators of an internal enterprise is carried out to determine what opportunities the organization has to attract and optimally use funds, ensure maximum income and minimize costs.

Analysis of financial risks. A special feature of financial risk analysis is the use of internal reports, accounting data, regulatory and planning information as information sources.

Express analysis. An express analysis of the financial performance of an enterprise is carried out in order to give a general and prompt assessment of the state of the enterprise’s operation, as well as to determine how effective its activities are.

In-depth analysis. Analysis of the financial results of an enterprise of this type is performed to make a fundamental assessment of the company's performance and financial condition.

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On the basis of what information is the analysis of the financial activity of an enterprise carried out?

This analysis is based on financial statements. Analysis of the financial statements of an enterprise is the main source of information.

It is important that the information in the reporting is useful and that specialists can make smart business decisions based on it. This is a key information requirement. It must have the following properties:

• reliability(the economic content of the data prevails over the legal form, the information can be verified and documented);
• relevance(data is meaningful and influences the user's decision; relevant information is also that which makes it possible to conduct retrospective and prospective);
• truthfulness(information in which there is no biased assessment, errors, falsification of economic events of the enterprise);
• clarity(users without special professional training understand what is said in the reporting);
• neutrality(lack of emphasis on satisfying the interests of some users to the detriment of others);
• comparability(information about the work of the company is comparable with similar information in the work of other organizations).

When generating reporting data, a number of restrictions must be observed in relation to the information included in the reporting:

• benefits and costs must be optimally correlated - this means that the costs of compiling reports must be in reasonable proportion to the benefits that the company receives from providing this information to interested users;
• you should remember the principle of conservatism (caution) - that is, the documentation should not overestimate assets and income and underestimate the volume of liabilities;
• confidentiality must be maintained, that is, the reporting information must not contain information that could harm the competitive strengths of the company.

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Methods of financial analysis of an enterprise

Method 1.Horizontal financial analysis. The basis of this type of enterprise analysis is the study of the dynamics of individual financial indicators in the process of work. It calculates how quickly individual financial reporting indicators grow over certain periods. In addition, general trends in their changes are monitored.

In the financial management industry, most often:

• study the dynamics of indicators of the reporting period in comparison with data from the previous period of time (month, quarter or year);
• examine the dynamics of indicators in the reporting period in comparison with similar indicators of the previous year - this is done in companies whose activities are seasonal;
• study the dynamics of indicators for certain previous periods in order to identify trends in their changes.

Method 2.Vertical financial analysis. The basis of vertical financial analysis is the structural decomposition of individual indicators of the company’s financial statements. Conducting a financial analysis of an enterprise of this type involves calculating the share of individual structural components of aggregated financial indicators.

As a rule, the following options for vertical structural analysis are used:

• structural analysis of assets - the results are used when optimizing the composition of these assets;
• structural analysis of capital - the results are used to evaluate the effect of financial leverage, determining the weighted average cost of capital, optimizing the structure of sources of borrowed financial resources;
• structural analysis of financial flows - specialists identify and analyze cash flows for activities of an operational, financial and investment nature.​

Method 3.Trend analysis. The basis of trend analysis is the calculation of relative deviations for certain periods (several years or quarters) from the level of the base period. A trend analysis of the financial condition of an enterprise is carried out in order to formulate possible values ​​of indicators in the future, that is, with its help they make a forecast for the future.

Method 4.Comparative financial analysis. The basis for its implementation is a comparison of individual groups of similar indicators with each other. Comparative (spatial) analysis of the financial performance indicators of an enterprise helps to calculate the size of the absolute and relative deviations of the compared indicators. Can be compared:

• financial indicators of this company and average industry firms (to assess the competitive position of the organization and identify reserves for improving the efficiency of its work);
• data from the company and its competing firms (identify the weaknesses of the enterprise in order to understand what measures should be taken to improve its competitive performance);
• information about individual units in the structure and divisions of a given company (we are talking about “responsibility centers”) in order to find internal reserves to optimize the efficiency of the company;
• reporting and planned (normative) financial indicators (they form the basis for monitoring the current operation of the enterprise).​

Method 5.Factor analysis. In factorial (or integral) financial analysis, one studies how individual reasons (factors) influence the final indicator.

As an example of an integral analysis of an enterprise, one can cite DuPont's three-factor model, which provides for the decomposition of the return on assets ratio as an indicator into certain private financial coefficients of its formation, interconnected by a common system. This indicator is the product of the profitability ratio of product sales by the number of turnover (turnover ratio) of assets.

R a = P rp + KO a = (Net profit/Revenue)*(Revenue/Assets)

Factor analysis of the financial condition of the enterprise contains:

1. SWOT analysis system for financial activities. Its name is an abbreviation of the first letters of the objects affected by the analysis. S – Strehgths (carrying out a financial analysis of an enterprise allows you to learn about the strengths of the company), W – Weaknesses (about weaknesses), O – Opportunities (about development opportunities), T – Trears (about threats to development). In a SWOT analysis, first of all, we study the strengths and weaknesses of the company's financial performance, and also find out how individual external factors can affect financial performance in the future.
2. An object-oriented system for integral analysis of the formation of an enterprise's net profit, the author of which is the American company Modernsoft, using computer equipment and a special package of application programs. The net income indicator in this analysis is expressed as a set of primary monetary blocks that interact with each other and model “groups” of elements that directly affect the formation of profit. The user has the opportunity to independently slightly change the system, taking into account the specifics of the company’s work. Expansion or deepening is acceptable if necessary.
3. A system of portfolio analysis or a “return-risk” system for an investment portfolio, which helps to increase the ratio of the level of income to the level of risk by forming an “effective” portfolio (that is, selecting certain securities).
4. Method of financial ratios. The main method of analysis, according to most researchers. When using the method of financial ratios (or relative indicators), the ratios of monetary reporting parameters are calculated. This happens because the calculation of relative indicators is also carried out using other methods, which are mentioned above (often specialists use a “method within a method”, that is, they use one method to implement another).

Validating the analytical value of financial ratios is their widespread use around the world. In the West there are a number of special publications with published statistical reports on these indicators. Many narrowly focused companies and news agencies have been organized, whose main focus is assessing financial condition using ratios and selling such information. It’s quite easy to do this kind of work if you have the necessary information and a certain amount of free time.

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Stages of financial analysis of an enterprise

Stage 1. Preliminary review of the economic and financial situation of the enterprise. Financial analysis begins with a review of key performance indicators. The following points will be considered in this review:

• what financial position the company is in at the beginning and end of the reporting period;
• under what conditions did the enterprise operate at the time of the report;
• what results the company has achieved over a given period;
• what can be said about the prospects for the financial and economic nature of the organization.

Based on balance sheet indicators, you can obtain accurate data about the company’s property position at the beginning and end of the reporting period. By comparing the dynamics of the results of the asset section of the balance sheet, you can find out in accordance with what trends the property position of the company has changed. Information about changes in the organizational management structure, the opening of new types of work, features of interaction with counterparties, etc., as a rule, is contained in an explanatory note to the annual financial statements.

The effectiveness and prospects of an enterprise can be judged in general, based on data from an analysis of income dynamics. Information can also be provided by a comparative analysis of the elements of growth of the firm's funds, income and production.

Information about gaps in a company's performance can be obtained by looking at the balance sheet. This information is sometimes displayed in a veiled manner. This situation arises if the reporting contains data on the insufficiently efficient work of the company during the reporting period and on the result of such work (for example, items “Losses”). Quite profitable companies may also have certain shortcomings in the conduct of financial work, which becomes clear from their balance sheet - information about this is usually hidden. This may happen due to falsification on the part of the organization or a certain methodology for developing reports adopted at the enterprise, according to which many balance sheet items are complex (for example, the item “Other creditors”).

Stage 2. Assessment and analysis of the economic potential of the organization. It is permissible to divide the second stage into two processes.

1. Assessment of property status. You can characterize the economic potential of a company in two ways, from the perspective of its property and financial status. There is a close connection between these parties in the financial and economic work of an enterprise: due to poor quality composition or irrational structure of property, the financial position of the company may worsen. The opposite situation is also possible.

The sustainability of a company largely depends on how correctly and rationally monetary resources are invested in assets.

As the company operates, the size and structure of its assets constantly changes. Vertical and horizontal analyzes of the financial statements of an enterprise help to create an overall picture of what qualitative changes the structure of funds and their sources is undergoing and the dynamics of these changes.

To assess the financial position of a company, horizontal and vertical analysis are used.

2. Assessment of financial situation. The financial position of a company can be judged from a short-term and long-term perspective. If the financial analysis of the enterprise and the assessment are carried out taking into account a short-term perspective, the criteria for assessing the financial position of the company are its solvency and liquidity, that is, the ability to pay off short-term obligations on time and in full.

The liquidity of a company is the presence of working capital in the amount that, theoretically, should be sufficient to repay short-term obligations ahead of schedule, albeit in violation of the repayment terms specified in the contracts.

As for solvency, in this case we talk about the availability of finance and cash equivalents for the enterprise to immediately repay loan debts.

The concepts of liquidity and solvency of a company are not identical. Thus, based on liquidity ratios, one can judge the financial position of an enterprise as satisfactory. But in practice, such a financial analysis of an enterprise and assessment are erroneous if current assets indicate, for the most part, overdue accounts receivable and illiquid assets.

The main indicators by which the solvency of an enterprise can be assessed.

1. The value of own working capital shows the part of the company’s personal capital, which is a source of covering existing assets, that is, those whose turnover is carried out in less than a year. This indicator is calculated - it is influenced by both the structure of assets and sources of finance. The amount of own working capital is very important for companies whose activities are commercial in nature and associated with intermediary operations. If other conditions remain the same and this indicator increases, this situation is considered favorable. The key and constant source of growth of your own finances is profit.
2. The maneuverability of functioning capital is working capital expressed in money, funds with absolute liquidity. If the company operates normally, this indicator varies from 0 to 1. If other conditions remain the same, and the maneuverability of operating capital increases, the trend is considered positive. The company itself sets the acceptable value of the indicator, which is indicative in nature. The formation of the value is influenced, for example, by the level of daily need for free finance.
3. The current ratio evaluates the liquidity of assets as a whole and shows the number of rubles per ruble of current liabilities. The principle of calculating this ratio is that the company pays off short-term obligations using current assets, that is, if current assets are greater than the value of current liabilities, the company is considered to be operating successfully (at least in theory). The value of the coefficient depends on the industry and type of activity. If this indicator increases, this is regarded as a positive phenomenon. Western accounting and analytical practice gives the lower critical level of the indicator - 2. But this number is indicative, indicating the order, and not the exact standard value.
4. The quick ratio is similar to the current ratio, but it uses fewer current assets to calculate it. The calculation does not take into account the most illiquid part in the form of inventories. The exception is made not only due to their lower liquidity, but also due to the fact that the finances that can be obtained through the forced sale of production units may be much less than the costs aimed at their acquisition. The indicator has an indicative value of 1, but the nature of this assessment is conditional. When analyzing the dynamics of an indicator, one should take into account the reasons why it changed. If the ratio has increased due to unjustified accounts receivable, the company’s activities cannot be considered favorable.
5. The absolute liquidity (solvency) ratio is the most stringent criterion for a company's liquidity. Based on it, one can draw a conclusion about what part of short-term borrowed obligations is better to repay urgently, if necessary. In Western manuals, the recommended lower limit of the coefficient is 0.2. Since industry standards for these ratios will begin to be developed in the future, today it is better to analyze the dynamics of these indicators by conducting a comparative analysis of the available information on companies with similar economic activities.
6. The share of own working capital in covering inventories is that part of the cost of inventories that is covered by own working capital. It is very important when analyzing the financial situation of trading companies; the recommended lower limit here is 50%.
7. Inventory coverage ratio - the indicator is calculated by correlating the amount of inventories and the amount of “normal” sources of their coverage. If the value is below 1, we can talk about the current state of the company as unstable.

The financial condition can be judged based on the stability of activities in the long term. Sustainable performance and the overall financial structure of an enterprise, as well as its level of dependence on investors and creditors, are closely related.

You can understand whether a company is financially stable in the long term by assessing the ratio of personal funds to debt. However, based on this indicator, only a general analysis of the financial stability of the enterprise can be carried out. In this regard, world and Russian accounting and analytical practice has provided a system of indicators:

1. The equity capital concentration ratio indicates the share of the company's owners in the total amount of finance invested in the operation of the enterprise. The financial position of an organization can be judged based on the value of this indicator - the higher it is, the better the company is doing: it is stable, sustainable and does not depend on external loans. The indicator is supplemented by the coefficient of concentration of borrowed (attracted) capital, the amount of which is 100% (or 1).
2. The financial dependence coefficient is the inverse of the coefficient mentioned above. If it grows dynamically, it means the share of borrowed funds in the company’s financing is increasing. When the value decreases to 1 (or 100%), it becomes clear that the owners finance their company in full.
3. The equity capital agility ratio shows what part of personal capital is used to finance current activities (that is, we are talking about the part of the enterprise’s capital invested in working capital and the capitalized part). The value of the ratio varies depending on what capital structure it has and what industry the company belongs to.
4. Long-term investment structure ratio: this indicator is calculated on the basis of the assumption that the use of long-term loans and borrowings is necessary to finance fixed assets and other capital investments. Thanks to the coefficient, you can find out about the part of key funds and other assets not in circulation that were financed by external investors.
5. The long-term leverage ratio allows us to judge the capital structure. If this indicator increases dynamically, the situation is considered unfavorable. This means that the company's dependence on outside investors is only increasing.
6. The ratio of own and borrowed funds allows you to assess the financial stability of the company as a whole. The ratio is quite easy to interpret. If its value is 0.179, for every ruble of personal funds invested in the company’s assets, there are 17.9 loan funds. If the indicator grows dynamically, it means that the enterprise’s dependence on creditors and investors from outside is increasing, that is, its financial stability is somewhat decreasing. The opposite value indicates the opposite situation.

There are no uniform normative criteria for the indicators outlined above. The considered indicators are influenced by many circumstances. These include lending principles, the company’s industry, the existing structure of sources of funds, their turnover, the organization’s reputation and other factors. In this regard, it is possible to assess the dynamics of the direction of changes in the coefficients, as well as the acceptability of the values, by comparing them by group.

Stage 3. Assessment and analysis of the effectiveness of financial and economic activities. Financial and economic analysis of an enterprise involves assessing the business activity and profitability of the company.

Business activity assessment

The task of assessing business activity is to analyze the results and effectiveness of key production activities at the moment. If we are talking about a qualitative assessment of business activity, it can be obtained by comparing the activities of a given company with related firms in the industry of capital investment. Qualitative (non-formalizable) criteria are the area of ​​markets for goods manufactured by the enterprise, the breadth of these markets; availability of goods for export; company reputation, etc.

There are two areas in which a qualitative assessment is made:

• the level of execution of the plan (which is determined independently or approved by a higher organization) for key indicators, ensuring the specified growth rate of these indicators;
• degree of efficiency in the use of enterprise resources.

When implementing the first direction, it is reasonable to take into account the comparative dynamics of key indicators. Here is the ratio that can be called optimal Tpb>Tr>So >100%, where Tpb, Tr, So is the rate at which profit, sales, and advanced capital change.

Often enterprises deviate from this ratio. However, deviations are not always negative. Here we are talking about retreats in connection with the development of new prospects for the application of capital, the modernization and reconstruction of existing industries. This line of activity is not always associated with significant financial investments, which, as a rule, do not bring immediate income, but can bring profit to the company in the future.

To implement the second direction, various indicators are often calculated that indicate the effectiveness of the use of material, financial and labor resources. We are talking about production, capital productivity, production inventory turnover, the duration of the operating cycle, and the speed of turnover of advanced funds.

Profitability assessment

The main indicators for assessing profitability used in countries with market economies are the profitability of advanced and own funds. From an economic point of view, it is simple to interpret these indicators - how many rubles of income account for one ruble of own funds invested in the activity.

The return on equity is influenced by three factors: resource productivity, profitability of business activities and the structure of advanced capital. The identified factors are significant, since in some way they are a generalization of all aspects of the financial and economic work of the company, in particular, accounting reporting. The first factor summarizes the assets of the balance sheet, the second – Form No. 2 “Profit and Loss Statement”, the third – the liabilities of the balance sheet.

Stage 4. Analysis of the structure of the enterprise's balance sheet. The presence of high tax and bank interest rates, as well as mutual non-payments between entities that are owners, leads to the insolvency of companies. The fact that an enterprise has become bankrupt (insolvent) can be judged, first of all, on the basis of its suspension of current payments and inability to meet the demands of creditors within three months from the moment they became due.

Here, the assessment of the balance sheet structure becomes especially relevant, since the enterprise is declared insolvent if it ceases to be satisfactory.

You can analyze and evaluate the structure of a company's balance sheet using indicators such as the equity ratio and the current liquidity ratio.

There is a reason why the balance sheet structure can be called unsatisfactory, and the enterprise itself can be called bankrupt. This:

• a situation in which the value of the current liquidity ratio (KTL) at the end of the reporting period is less than 2;
• a situation in which the value of the enterprise's self-sufficiency ratio (Koss) at the end of the reporting period is less than 0.1.

A key indicator that a company has a real possibility of restoring (or losing) its solvency over a certain period of time is the coefficient of restoration (or loss) of its ability to pay. If at least one coefficient is below the norm (Ctl<2, а Косс<0,1), расчет коэффициента восстановления платежеспособности производится за период, равный полугоду.

If the current liquidity ratio is greater than or equal to 2, and the ratio of the enterprise's own financial resources is greater than or equal to 0.1, the calculation of the loss of solvency ratio is carried out for three months.

The solvency recovery ratio (KVOS) is the ratio of the calculated current liquidity ratio to its standard. If the value of Kvos is more than 1, the enterprise has a real opportunity to restore solvency. If it is less than 1, the company has no obvious chance of regaining its viability within the next six months.

The loss of solvency coefficient Ku is the ratio of the calculated current liquidity ratio to its specified value.

The procedure for obtaining objective information about the solvency of an enterprise.

The conclusion gives an idea of ​​the economic sustainability of the business model used. The results of the study are of great importance when making investment and management decisions.

What does financial analysis include?

• Autonomy. The ratio reflects the ratio of the company's own funds and total capital. The company's independence from the will of third parties is the key to sustainability.
• Current liquidity. The calculation is made by dividing current assets by the amount of liabilities with a short execution period (up to one year).
• Return on capital. The indicator shows the ratio of equity to the company's net profit. Efficient use of resources indicates competent management and quality planning.
• Fast liquidity. To determine this ratio, all short-term investments, accounts receivable, and cash are added up. The result is divided into obligations with a repayment period of no more than 12 months.
• Sales profitability. In this case, experts compare gross profit and revenue. The indicator is necessary for developing implementation policies.

Methods for analyzing enterprise finances are constantly being improved, but vertical and horizontal reporting research remains the most popular. Experts use forecasting based on trends and key economic factors. Most ratios are calculated based on the balance sheet. The data contained in the report on the results of economic activities is taken into account. However, the procedure may require the provision of a number of specific documents.

Briefly about the results

The norm is a combination of own funds and long-term loans. The combination provides solvency and a sufficient level of autonomy. Production activities are carried out stably and without interruption.

An alarming signal is the frequent attraction of loans with medium and short repayment periods. Instability is evidenced by the direction of loans to cover business costs. If any funds are spent on paying bills, it makes sense to talk about insolvency. This is one of the clear signs of impending bankruptcy.

Financial analysis allows you to solve other problems. Detailed calculations help owners identify errors in planning and capital management. With a comprehensive study, specialists receive accurate data on the provision of material reserves, investment coverage, and sustainability of growth.

JSC "Arsenal" (EXAMPLE)

as of 01/01/2015

The market stability of an enterprise is its ability to function and develop, maintain a balance of its assets and liabilities in a changing internal and external environment, guaranteeing its constant solvency and investment attractiveness within the acceptable level of risk.

To ensure market stability, an enterprise must have a flexible capital structure and be able to organize its movement in such a way as to ensure a constant excess of income over expenses in order to maintain solvency and create conditions for self-reproduction.

I. Indicators determining the state of working capital

An assessment of the equity ratio for the analyzed period indicates that the organization does not depend on borrowed sources of funds in the formation of its current assets, it is able to carry out uninterrupted financial and economic activities.

In 2014, the share of funds intended to repay debts decreased by -1.8 points and amounted to 73.7%. This indicates a decrease in the ability to ensure uninterrupted operations while paying off creditors. At the same time, the share of funds absolutely ready for payment in the total amount of funds allocated to repay long-term debts increased by 3.7 points and amounted to 20.5% of the total amount of current assets of the enterprise.

The value of the ratio of supply of inventories and costs with own working capital as of 01/01/2014 is below normal. However, during the analyzed period there was a significant increase to 85%, i.e. higher than normal value. This indicates that the improvement in the financial condition of the enterprise has led to the fact that it is able to cover, at the expense of its own current and long-term borrowed sources, not only the required amounts of inventories and costs (a justified need for inventories and costs in those periods when their turnover rate is higher ), but also their entire volume

II. Indicators that determine the condition of fixed assets

During 2014, the financial ability of the enterprise to finance its non-current assets from its own funds decreased. Moreover, as of January 1, 2014, their cost is covered by own funds by 57.1%, and as of the end of the period - by 43.8%.

For 2014, fixed assets, capital investments, equipment, inventories and work in progress accounted for more than 50% of the value of the entire property of the enterprise. However, during the reporting period, this indicator decreased by 3.1 points and amounted to 67.1%, which indicates a decrease in favorable conditions for creating production potential and for financial activity. At the same time, the share of fixed assets, raw materials and work in progress in the value of the property remained at 0%, i.e. the provision of production means has not changed.

III. Indicators characterizing the capital structure

The level of the autonomy coefficient during the analyzed period increased significantly (by 0.171) and amounted to 0.601. An increase in the indicator indicates an increase in financial independence, increases the company’s guarantee of repaying its obligations and expands the possibility of attracting funds from outside. The company's chances of coping with unforeseen circumstances arising in a market economy have increased significantly. An assessment of the value of the debt capital concentration ratio confirms this conclusion.

At the end of the reporting period, the enterprise's own funds were negative, i.e. the financial stability of the enterprise has decreased significantly. Moreover, both at the beginning and at the end of the analyzed period, the level of the capitalization ratio is limited by the value of the ratio of the cost of mobile funds to the cost of immobilized ones, which indicates a sufficient degree of financial stability of the enterprise. This conclusion is confirmed by the value of the financing ratio.

The ratio of the total value of own and long-term borrowed funds to the total value of non-current and current assets during the analyzed period increased by 17 points and amounted to 61%, which exceeded the permissible level. This indicates a significant increase in the value of assets financed from sustainable sources, i.e. the enterprise's dependence on short-term borrowed sources of coverage decreases.

IV. Indicators characterizing the share of debt in the enterprise’s sources of funds

An assessment of the coefficients showing the share of long-term and short-term debt in the enterprise’s sources of funds allowed us to draw the following conclusions:

1. The share of long-term borrowed funds involved in the formation of capital investments decreased by 0.9 points and amounted to 1.4%.

2. The share of short-term liabilities of the enterprise in the total amount of external liabilities decreased by 0.4 points and amounted to 97.9%. At the same time, the share of long-term liabilities increased and amounted to 2.1%.

3. The level of accounts payable for the period increased by 24.7 points and amounted to 97.9% of external liabilities.

4. The company's position on the market is quite stable.