Assessment of financial viability
The financial stability of the company - is a generalized description of the financial condition of the company, which to some extent includes the liquidity and solvency. At the same time, has its own system of evaluation criteria of financial stability that businesses use to assess the reliability of partners in economic relations.
Under the financial stability understand this state of financial resources, their structure and level manevrovosti, which provided for financial independence and development based on revenue growth, capital provided acceptable level of risk.
Financial stability is measured metrics that can be grouped into three main groups:
1) indicators of the level of fixed assets;
2) indicators of current assets and ensure their funding sources;
3) performance of financial independence of the company.
It is an important indicator of financial stability is the ratio of the real value of the property, because the success of any enterprise depends on the provision of means of production. Real estate - it's fixed assets, inventories, work in progress that are involved in the production process, create products, provide continuous operation. Therefore, this indicator interested suppliers, buyers, ie those contractors who want to understand the production potential of the company. The value of this index changed from 0.71 to 0.63. Although it has not gone beyond the acceptable, should pay attention to the absolute decrease in the value of real assets, especially fixed assets. The company reduced the possibility of increasing production in the future that could affect the financial stability of the company.
The ratio of current and non-current assets depends on the specific sector on the one hand, and the structure of financing sources of the company, on the other. To ensure minimum financial stability must comply with conditions that CO / n> R / B.
The continuity of the production process is provided when most of the stocks covered and costs of working capital, the company is independent in forming their stocks. But if the coefficient of coverage its own working capital greater than one, this means reducing the effectiveness of financial resources.
In the analysis must take into account the fact that the level of this index is estimated depending on the stock. If the value of stocks exceeds the standard, the working capital cover only a part of them and the indicator will be artificially low. On the contrary, when the company will be insufficient inventories, the coefficient can exceed unit, but this is not a sign of a strong financial condition. In this regard, for each company mentioned in this indicator should be calculated on the basis of regulation of its own working capital.
Where the working capital is not enough to create reserves, estimated other funding sources. For this index is calculated covering stocks.
The most complete financial stability of the company reflects the rate of autonomy, ie financial independence from external debt financing. The higher this value, the higher the ranking the company among the creditors. In connection with this growth strategy involves increasing equity through retained earnings, additional capital.
With the economic crisis to maintain financial stability at high level requires the implementation of systematic management of complex measures to prevent lowering of the characteristics of the company.