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Assessment of financial and economic resultsactive activity of the enterprise
Introduction
financial economic management
The relevance of the topic of final qualifying work is determined by the fact that in a market economy for effective management an economic entity and planning its activities, the management and owners of the enterprise need to have an idea of the state of the enterprise.
The results of financial and economic activities are objective indicators that represent a consequence of the influence external environment on the enterprise, and certain management decisions.
By assessing the results of financial and economic activities, it is possible to identify trends that relate to certain indicators. This makes it possible to understand what caused such trends. Based on the assessment of financial and economic activities, certain decisions are made regarding the organization.
In addition to management decisions made by the owners and management of the company, an assessment of the results of financial and economic activities may be necessary for potential investors or creditors of the enterprise. Also, an assessment of the financial and economic activities of a particular organization can be carried out by potential partners who assess the reliability of the counterparty.
Based on the above, we can conclude that the topic of this final qualifying work is very important and relevant at the current time.
The object of research in the final qualifying work is the company "Restoration" LLC.
The subject of the work is the assessment of the financial and economic activities of a given enterprise.
The purpose of the final qualifying work is to assess the results of the financial and economic activities of the enterprise (based on materials from Vosstanovlenie LLC).
To achieve this goal, the following tasks must be solved:
Consider the main directions for assessing the effectiveness of an enterprise, concepts and tasks;
Describe the methodology for assessing the financial and economic activities of an enterprise;
Give an organizational and economic description of the enterprise LLC “Restoration”;
Conduct an assessment of the results of the financial and economic activities of the enterprise LLC “Restoration”;
Consider measures to improve the financial and economic activities of the enterprise LLC “Restoration”;
Conduct an assessment of the effectiveness of measures to improve the financial and economic activities of the enterprise Vosstanovlenie LLC.
The research methods used in this final qualifying work consist of collecting and analyzing theoretical and practical information. In the process of writing the thesis, research methods such as the deduction method, the induction method, and information synthesis were used.
The information base of the research is represented by textbooks and articles on economic and financial analysis by such authors as G.V. Savitskaya, L.N. Chechevitsyna, A.D. Sheremet, E.V. Negashev, R.S. Saifulin and others. Also, as an information base for writing this final qualifying work, the reporting of LLC “Restoration” and information about the activities of the enterprise, which was obtained as a result of the internship, were used.
The practical significance of the research in the final qualifying work lies in the fact that it provides specific recommendations for LLC “Restoration”, which could help improve the efficiency of the financial and economic activities of the enterprise.
1 . Theoretical aspects and methods for assessing the efficiency of financial and economic activities of an enterprise
1.1 Main directions for assessing the effectiveness of an enterprise: concepts and tasks
Effective economic activity is the goal of any organization. The result of financial and economic activity depends on the effective use of raw materials, material, labor, financial resources etc. Failures in production activities, sales, and a decrease in the quality of manufactured goods have a negative impact on the company’s work. Management should constantly analyze the results of activities and look for reserves for increasing efficiency.
The most important tasks of enterprise performance are presented in Appendix 3
The assessment results contribute to increasing awareness of the organization’s management personnel and other users economic information- the subject of the assessment - about the state of the objects of interest to him.
As a general indicator of the effectiveness of an organization’s economic work, it is necessary to use the ratio of the volume of goods sold or the effect in the form of income to the total amount of resources containing the average annual cost of fixed and working capital or to total amount production or sales costs.
Analysis of economic activity consists of a comprehensive, comprehensive consideration, measurement and generalization of the impact of factors on the final results of the company’s activities based on processing, using special techniques and methods, a system of interrelated indicators of the business plan, accounting, reporting and other operational data in order to improve financial condition firm, growth of production efficiency, company competitiveness.
The analysis of economic activity is systematized according to various criteria:
1. Based on time, it is divided into preliminary (prospective) and subsequent (retrospective, historical).
A preliminary assessment is carried out before the implementation of business transactions. It is needed to justify management decisions and plan targets, as well as to predict the future and assess the expected implementation of the plan, and prevent negative outcomes.
Subsequent (retrospective) assessment is carried out after the completion of business acts. It is used to monitor the implementation of the plan, identify unused reserves, and objectively assess the results of the organizations’ activities.
Retrospective assessment is divided into operational and final. Operational (situational) assessment is carried out immediately after business transactions are completed or the situation changes over short periods (shift, day, decade, etc.)
The goal is: prompt identification of disadvantages and impact on business processes. A market economy is characterized by the dynamism of the situation, both industrial, commercial, financial work the company and its external environment.
The final (final) analysis is carried out for the reporting period of time (month, quarter, year). The value of this analysis lies in the fact that the company’s work is examined comprehensively and comprehensively based on reporting data for the relevant periods. This provides a more complete analysis of the company’s work in using existing capabilities.
The final and operational assessment are interconnected and complement each other. They enable the company’s management not only to quickly eliminate shortcomings in the process of production activities, but also to comprehensively summarize achievements, results of production activities and, over the appropriate periods of time, develop measures that are aimed at increasing the effectiveness of production activities of construction and installation work.
2. Based on spatial characteristics, intra-farm and inter-farm analysis are distinguished. An on-farm assessment examines the work of only the company being studied and its structural departments. In inter-farm analysis, the results of the activities of two or more organizations are compared. This allows us to identify best practices, reserves, and disadvantages and, based on this, provide a more objective analysis of the company’s performance.
3. A significant role is played by the classification of the analysis of economic activities by management objects. Economic activity (managed system) consists of such separate subsystems as: economics, technology, technology, organization of production activities, social conditions labor, environmental activities, etc.
In this regard, we can highlight:
Technical and economic assessment (applies to the company’s technical services). Consideration of the interaction of technical and economic processes and establishing their impact on economic results company work.
The financial and economic assessment (the company’s financial service, financial and credit authorities) pays significant attention to the financial results of the company’s work: financial plan, the efficiency of using equity and borrowed capital, identifying reserves for growth in income, increasing profitability, improving the financial condition and solvency of the company;
An audit (accounting) assessment is an expert diagnosis of the financial “health” of a company. Conducted by auditors or audit firms to assess the forecasting of financial condition and financial stability business entities;
Socio-economic assessment ( economic services departments, sociological laboratories, statistical bodies) explores the relationship between social and economic processes, their impact on each other and on the economic results of economic activity;
Economic and statistical assessment (statistical bodies) is used to consider mass social phenomena at various levels of management: company, industry, region;
Economic and environmental assessment (protection authorities environment) studies the interaction of environmental and economic processes related to the preservation and improvement of the environment and environmental costs;
Marketing assessment (marketing service of an enterprise or association) is used to consider the external environment of the company’s functioning, markets, raw materials and sales of finished goods (customers), its competitiveness, supply and demand, commercial risk, formation pricing policy, development of tactics and strategies for marketing activities.
4. According to the methodology for considering objects, they distinguish: comparative, diagnostic, factorial, marginal, economic-mathematical, economic-statistical, functional-cost assessment of economic activity, etc.:
In comparative analysis, they are usually limited to comparing reported indicators on the results of economic activities with plan indicators current year, data from past years, leading organizations;
Factor assessment is aimed at identifying the size of the impact of factors on the growth and level of final indicators;
Diagnostic (express analysis) is a method of establishing the nature of violations of the normal course of economic processes on the basis of typical signs characteristic only of a given violation;
Marginal assessment is a method of assessing and justifying the effectiveness of management decisions in business on the basis of the cause-and-effect relationship between the volume of sales, the cost of construction and installation work and income, dividing costs into continuous and variable;
Using economic and mathematical analysis, the most optimal solution options are selected economic tasks, a reserve for increasing production efficiency is identified through a more complete use of available resources;
Stochastic assessment (dispersion, correlation, component, etc.) is used to consider stochastic dependencies between the phenomena being studied and the processes of economic activity of organizations;
Functional cost analysis (FCA) is a method for identifying reserves. It is based on the functions that the object performs and is focused on optimal methods for their implementation at all stages life cycle buildings (research, design, construction, operation). Its main purpose is to identify and prevent unnecessary costs.
5. Based on the subjects (users of analysis), a distinction is made between internal and external assessment. Internal assessment is carried out directly at the enterprise for the needs of operational, short-term and long-term management of production, commercial and financial activities. External assessment is carried out on the basis of financial and statistical reporting economic management bodies, banks, financial authorities, shareholders, investors.
6. Based on the coverage of the objects under study, the assessment is divided into continuous and selective. With a continuous survey, conclusions are drawn after examining all objects without exception, and with a selective survey, based on the results of examining only a part of the objects.
7. According to the content of the program, complex and thematic analysis is distinguished. Comprehensive means that the company’s work is studied comprehensively, while thematic means that only its individual aspects are examined, which at a certain moment are of the most significant interest, for example, issues of application material resources, the company's production capacity, cost reduction.
Each of these forms of analysis of economic activity is unique in content, organization and methodology of its implementation.
1.2 Methodology for assessing the financial and economic activities of an enterprise
Today, there is no generally accepted system of indicators for the efficiency of production and economic work of an organization. To measure the effectiveness of the same activities, a variety of methods are used, sometimes not interconnected, sometimes giving varied results.
To determine overall economic performance, a system of indicators is used, within which a distinction is made between general and differential indicators.
The main task of the company in a market economy is to fully satisfy the needs of the national economy and citizens in its goods, works and services with significant consumer properties and quality at minimal costs, increasing the contribution to the acceleration of social economic development countries. To achieve its main task, the company ensures an increase in income.
Profit is the primary incentive for the formation of new or development of existing organizations. Income opportunities encourage people to seek more effective ways combinations of resources, invent new products for which there may be demand, use organizational and technical innovations that promise to increase the effectiveness of production activities.
The enterprise's performance indicators are presented in Appendix 4.
In cases where the annual volumes of production activities and sales of goods of a company differ from each other, it is advisable to also indicate the corresponding annual actual volumes of sales of marketable goods produced by the enterprise.
By type of activity, profit from operating, investment and financial activities. Operating profit is the result of production and sales or the main activity for a given company. Bottom line investment activities partially reflected as income from participation in joint activities, from the ownership of securities and deposits, partly from income from the sale of property. In addition, the results of investments are reflected in operating income when investments turn into real assets to expand, update and modernize production activities.
Profit from financial activities is understood as the indirect effect of attracting capital from external sources on terms more favorable than average market conditions.
In addition, in the process of financial activities, the received and direct profit on invested equity capital is distinguished by applying the effect of financial leverage.
Based on the composition of the included elements, they distinguish between marginal (gross) profit, profit before tax, and net profit. Marginal profit is the difference between net revenue and direct production costs for goods sold. Profit before tax characterizes the overall financial result of the company. Profit before tax is the sum of the financial result from ordinary activities and other income and expenses. Net profit is the amount of income that remains at the disposal of the company after paying income taxes.
According to the nature of application, net profit is divided into capitalized and consumed. Capitalized profit, part of net income used to finance the growth of the company's assets. Consumed profit is that which is spent on paying dividends to shareholders and founders of the company.
Based on the nature of taxation, a distinction is made between taxable and non-taxable. This division of income plays a major role in the formation tax policy, as it allows you to evaluate alternative business transactions in terms of their effect. The composition of income that is not subject to taxation is regulated by tax legislation.
Based on the nature of inflationary cleaning of income, a distinction is made between nominal and real income, adjusted for the inflation rate in reporting period.
For the formation period under consideration, the profit of the reporting year, the profit of the previous year and the planned profit are distinguished.
The given list of classification criteria does not reflect the entire variety of types of income used in scientific terminology and company practice.
Target entrepreneurial activity- not only generating income, but also ensuring significant profitability of business activities. Unlike absolute indicator income, profitability is a relative indicator and shows the degree of profitability of the company. Profitability reflects the level of profitability relative to a certain base. An enterprise is profitable if the amount of revenue from the sale of goods is sufficient not only to cover the costs of production and sales, but also to generate income.
Profitability indicators measure the company's profitability from different perspectives and are grouped according to the interests of the participants economic process. They are the main characteristics of the factor environment for generating the company’s income and income. For this reason, they serve as mandatory elements of comparative analysis and assessment of the financial condition of the company. When analyzing production activities, profitability indicators are used as a tool for investment policy and pricing.
The main groups of indicators are presented in Appendix 5.
The first group of indicators is formed on the basis of calculating the levels of profitability (profitability) reflected in the company’s reporting:
These indicators characterize the profitability of goods. The profitability of goods can be calculated both for all goods sold and for its individual types. In the first case, it is defined as the percentage ratio of income from the sale of goods to the costs of its production and sale. The profitability of all goods sold can also be calculated as a percentage of income from the sale of purchased goods to sales proceeds (sales volume). These indicators give an idea of the effectiveness of the company's current costs and the profitability of goods sold.
Profitability individual species goods depends on their selling price and total cost. It is defined as the percentage ratio of the selling price of a unit of these goods minus the full cost to the full cost of a unit of these goods.
In this regard, when planning the range of manufactured goods, it is taken into account how much the profitability of individual types will affect the profitability of all goods. Therefore, the main thing is to form the structure of goods in such a way as to generally increase the efficiency of commercial activities and obtain additional features income growth.
The second group of profitability indicators is formed based on the calculation of profitability levels depending on changes in the size and nature of the advanced funds:
All production assets of the company;
Investment capital (equity and long-term liabilities);
Shareholder (own) capital.
Eg:
The discrepancy between the levels of profitability according to these indicators characterizes the degree to which the enterprise uses financial levers to increase profitability: long-term loans and borrowed funds.
These indicators are very practical due to the fact that they correspond to the interests of the participants. For example, the company administration is interested in the return (profitability) of all production assets, potential investors and creditors - the return on shares, etc.
The third group of indicators is formed similarly to the indicators of the first and second groups, but instead of income, net cash inflow is taken into account.
These indicators give an idea of the extent to which a company can provide cash to lenders, borrowers and shareholders. The cash flow concept of profitability is widely used in developed market economies. It is a higher priority because cash flow transactions are a sign of an intensive type of production activity and the financial “health” of the company. The transition to the application of this concept requires a restructuring of organizations' reporting. this work is only in its early stages.
The variety of profitability indicators determines the alternativeness of searching for ways to grow. Each of the initial indicators is decomposed into a factor system with varying degrees of detail, which sets the boundaries for identifying and assessing production reserves.
Indicators of the actual financial efficiency of the enterprise's economic activities are presented in Appendix 6.
If necessary, the actual profitability of the labor of all employees of the company, the production activity of conditionally pure and pure goods at the enterprise, the human and general property and land capital of the company, as well as the actual part of net income in the balance sheet income of the company can be considered.
Indicators of social efficiency of economic activities of enterprises are presented in Appendix 7.
When analyzing the performance of economic activities in terms of income, the rate of increase in income is compared with the rate of increase in sales volumes and expenses, which should be correlated in the following way:
where P is the income indicator, monetary units;
O - sales volume indicator, monetary units;
Z - indicator of expenses, monetary units.
There are various types of profitability that act as performance indicators. Overall profitability is the most basic parameter of an organization’s competitiveness and is calculated by the ratio of income to the average annual cost of fixed assets and standardized working capital. Return on equity (borrowed) capital is defined as the ratio of income to equity (borrowed) capital. Profitability equity shows the organization's ability to repay capital, and the borrowed capital - the effectiveness of the use of borrowed funds. Rate of income for borrowed capital must be higher than the interest paid for the loan presented. The profitability of goods is determined by the ratio of income to the total cost of goods manufactured (sold) during the reporting period. Return on turnover is calculated as the ratio of income to the volume of goods sold for a certain period.
Differentiated indicators characterize the efficiency of using certain types of resources and costs. To calculate differentiated indicators, two approaches are used: resource and cost.
Methodology for calculating differentiated indicators based on resource method- this is the calculation of indicators of the effectiveness of the use of: labor resources: labor output (production), labor intensity of goods (works, services), relative savings in the number of employees.
Output (B) shows the size of the result per unit of labor resources and is determined by the formula
where VP is the volume of goods or activities performed in natural or conditionally natural units;
Ch sp - average number of employees, people. Labor intensity (T E) represents the cost of working time to produce a unit of goods. Calculated using the formula:
where T is the time spent on the production of all goods, standard hours.
Relative savings of employees () is determined by the formula:
where H base and H reporting - the number of employees of the organization according to the main and reporting period, people;
J VP - index of increase in the volume of production activity of commodity or sold goods of the reporting period when compared with fixed assets: determined by capital intensity, capital productivity and relative savings of production assets.
Capital intensity (F) shows the size of fixed assets per unit of goods completed during the established calendar period, and is determined by the formula:
where OF is the cost of fixed assets, monetary units.
Capital productivity (F o) is determined by the formula:
Relative savings of fixed assets () is calculated using the formula:
where OF BAZ and OF OTCH - the cost of fixed assets according to the main and reporting periods, monetary units.
Based on working capital, the following are determined: turnover ratio, load factor and relative savings of working capital.
The turnover ratio (KRR) is determined by the formula
where O B C is the average annual balance of working capital in the company for the year, monetary units.
The load factor (KZ) is calculated using the formula:
Relative savings of working capital () is determined by the formula:
where O B S BAZ and O B S OTCH are working capital according to the main and reporting periods, monetary units.
Also, the efficiency of using fixed assets is assessed by indicators of the use of material resources - material intensity, material productivity and relative savings in material costs. Material consumption (M E) is determined by the formula:
where MZ - material costs, monetary units.
Material yield (M O) is calculated using the formula:
Relative savings in material costs () are calculated using the formula:
where MH BAZ and MH OTCH are material costs according to the main and reporting periods, monetary units.
Capital intensity (K E) is calculated using the formula:
where KV - capital investments in production, monetary units;
VP is the increase in the output of goods due to these capital investments, in physical and cost terms.
Capital productivity (K O) is calculated using the formula:
Relative savings on capital investments () is calculated using the formula
where KV BAZ and KV OTCH are capital investments according to the main and reporting periods, monetary units.
When analyzing economic performance, other indicators are also used.
For example, the cost of one monetary unit goods show size cash expenses, per one monetary unit of goods (works, services) sold for a calendar period.
2 . Assessment of the results of the financial and economic activities of an enterprise (using the example of LLC« Recovery")
2.1 Organizational and economic characteristics of the LLC enterprise« Recovery"
Society with limited liability“Restoration” was registered on August 10, 2000 by the Tax Inspectorate of the Russian Federation for the Central District of Lipetsk, OGRN 1024840839066 is a legal entity and operates under the conditions and in the manner determined by the Charter.
Location of the Company: 398006, Lipetsk, Universalny proezd, 2. But according to changes made in the Charter of the Limited Liability Company “Restoration” dated December 19, 2013. Clause 1.3 is stated as follows: “Location of the Company: Russia, Lipetsk region, Lipetsk, st. Dovatora, 12.”
The goals of Vosstanovlenie LLC are to make a profit.
The subject of the Company's activities are:
Wholesale trade of machinery and equipment for metallurgy;
Intermediary services, commercial and exchange transactions, marketing;
Organization of cargo transportation, including international;
Provision of warehousing services;
Other types of activities not prohibited by the legislation of the Russian Federation.
The main activity of Vosstanovlenie LLC is wholesale machines and equipment for metallurgy.
LLC "Restoration" is also engaged in the development and implementation of new technologies for the restoration and production of critical parts and technological tools for metallurgical enterprises (furnace rollers, radiant pipes, rollers of pipe rolling and pipe welding mills, disk and edge crushing knives, forming rollers of leveling machines, etc. .), which are made from heat-resistant, stainless, heat-resistant and tool grades of steel. The company has several patented discoveries to its credit.
The main organizer and permanent leader is Ivan Petrovich Borodin, Candidate of Technical Sciences, who has worked in the metallurgical engineering industry of the USSR and Russia for more than thirty years. He has dozens of inventions in the field of surfacing, welding, heat treatment, metal science and special electrometallurgy.
Let's look at the organizational structure of the enterprise in Figure 1.
Figure 1. Organizational structure of Vosstanovlenie LLC
Directly to CEO obeys Chief Accountant, as well as the chief engineer, legal department, head of the human resources department, head of marketing and sales, leading engineer for the preparation and conclusion of contracts, as well as the security agencies of PSC Bastion-L and PSC Katran.
2.2 Assessment of the results of financial and economic activities of the LLC enterprise« Recovery"
In order to assess the financial results of the activities of Vosstanovlenie LLC, we will first analyze the assets and liabilities of the balance sheet.
In Appendix 9 we will analyze the balance sheet asset indicators. The balance sheet of Vosstanovleniye LLC is presented in Appendix 1.
Analyzing the data presented in Appendix 9, we can conclude that the balance sheet currency in 2014 compared to 2013 increased by 1,611 thousand rubles. or by 3.61%.
The greatest changes in 2014 compared to 2013 took place in the item other non-current assets. For this indicator, the value increased by 10,049 thousand rubles. or by 956.14%.
The balance sheet currency in 2015 decreased by 7916 thousand rubles. or by 17.12%. This suggests that the volume of assets that are on the balance sheet of the company Vosstanovleniye LLC decreased during the period.
For individual items of the balance sheet asset, one can also note a decrease in the accounts receivable indicator by 7,795 thousand rubles. or by 32.66%. This indicates that the company is effectively seeking repayment of debt from counterparties for products supplied to it.
Fixed assets during the reporting period decreased slightly - by 13 thousand rubles. in absolute terms or by 0.22% in relative terms.
On the contrary, the reserves indicator increased during the reporting period. The growth in absolute terms amounted to 825 thousand rubles. In relative terms, this indicator increased by 15.12%.
Let's look at the structure of the balance sheet asset in 2013 in Figure 2.
Figure 2. Structure of the asset balance sheet of LLC “Restoration” in 2013, thousand rubles.
Analyzing the structure of the balance sheet asset in 2013, we can conclude that the main share of the asset in 2013 was accounts receivable (52%).
In 2014, reserves were in second place (30%).
In order to assess the structure of the balance sheet asset in 2014, let’s look at the structure of the asset in Figure 3.
Figure 3. Structure of the asset balance sheet of LLC “Restoration” in 2014, thousand rubles.
Based on the data presented in Figure 2, we can conclude that in 2014 the most significant item in the balance sheet asset was accounts receivable. In the structure of the balance sheet asset, the indicator for this item was 52%.
The remaining balance sheet asset items total less than 50% of the balance sheet asset. The largest item following accounts receivable is the indicator of other non-current assets, which in 2014 was 24%.
Figure 4. Structure of the asset balance sheet of LLC “Restoration” in 2015, thousand rubles.
Compared to 2014, there were no very serious changes in the balance sheet structure of Vosstanovleniye LLC. As before, the main asset item on the balance sheet remains accounts receivable. The share of this article decreased and in 2015 amounted to 42%.
The item other non-current assets remains in second place in terms of share. In 2015, the share of this article was 26%.
An analysis of the balance sheet liabilities is presented in Appendix 10.
The most noticeable change in the balance sheet liabilities in 2014 compared to 2013 is the increase in the indicator of short-term borrowings.
This figure in 2014 increased by 1,896 thousand rubles. or by 1185%.
Considering the changes in the liability indicators of the balance sheet of LLC “Restoration” in 2015, we can say that retained earnings decreased by 4397 thousand rubles. or by 95.32%.
Long-term borrowed funds during the period under review decreased by 2,465 thousand rubles. or by 15.74%.
There was also a decrease in such a liability item on the balance sheet as short-term borrowed funds. During the period, this figure decreased by 1,075 thousand rubles. or by 52.29%.
In Figure 5, we consider the structure of the balance sheet liabilities in 2013.
Figure 5. Analysis of the liability structure of the balance sheet of LLC “Restoration” in 2013, thousand rubles.
Analyzing the liability structure of the enterprise’s balance sheet in 2013, it can be noted that the largest share (68%) in it is accounts payable.
Figure 6. Analysis of the liability structure of the balance sheet of LLC “Restoration” in 2014, thousand rubles.
Analyzing the structure of the balance sheet liability of LLC “Restoration” in 2014, we can say that the largest share in the balance sheet liability is accounts payable. Specific gravity this indicator in liabilities in 2014 is 52%.
The second place in terms of volume is long-term borrowed funds. The share of this indicator in 2014 is 34%.
Figure 7. Analysis of the liability structure of the balance sheet of LLC “Restoration” in 2015, thousand rubles.
Considering the balance sheet structure of Vosstanovlenie LLC in 2015, one can see that the share accounts payable, which, just like in 2014, makes up the majority of the balance sheet liability, increased and amounted to 62%.
Long-term borrowed funds also remain in second place in terms of share. The share of this indicator in 2015 was 34%.
Analysis of balance sheet liquidity assesses the creditworthiness of an enterprise, that is, its ability to timely and fully pay all its obligations. An analysis of balance sheet liquidity is given in Appendix 8.
To analyze the liquidity of the balance sheet, you should compare the results of the asset and liability groups. The following types of balance sheet liquidity are distinguished: absolute liquidity, current liquidity, prospective liquidity and general or complex liquidity.
The conditions for absolute liquidity are written as a set of inequalities:
A 1 P 1, A 2 P 2, A 3 P 3, A 4 ?P 4, (2.1)
where A 1 - the most liquid assets;
P 1 - the most urgent obligations;
A 2 - quickly realizable assets;
P 2 - short-term liabilities;
A 3 - slowly selling assets;
P 3 - Long-term liabilities;
A 4 - difficult to sell assets;
P 4 - permanent liabilities.
The current liquidity condition has the form:
(A 1 + A 2) (P 1 + P 2) (2.2)
The forward-looking liquidity condition is as follows:
A comparison of A 1 and P 1 reflects the ratio of current payments and receipts for up to three months. A comparison of A 2 and P 2 shows a tendency for liquidity to increase or decrease over a period of 3 to 6 months. A comparison of A 3 and P 3 shows the liquidity of the enterprise over a period of more than 6 months. The ratio of A 4 and P 4 shows whether the enterprise has enough of its own funds to conduct current activities.
Considering the liquidity indicators of the balance sheet of LLC “Restoration”, we can say that the balance sheet indicators do not fulfill the condition of absolute liquidity. This state of affairs occurs in 2013, 2014 and 2015.
Let's consider whether the balance sheet indicators of Vosstanovleniye LLC meet current liquidity requirements:
In 2013:
A 1 + A 2 = 62 + 23163 = 23225 thousand rubles.
P 1 + P 2 = 30233 + 160 = 30393 thousand rubles.
Comparing the figures calculated above for 2013, we can say that the current liquidity condition is not met in 2013.
In 2014:
A 1 + A 2 = 23 + 23866 = 23889 thousand rubles.
P 1 + P 2 = 23905 + 2056 = 25961 thousand rubles.
Comparing the figures calculated above for 2014, we can say that the current liquidity condition is not met in 2014.
Let's consider the situation for 2015:
A 1 + A 2 = 203 + 16071 = 16274 thousand rubles.
P 1 + P 2 = 23926 + 981 = 24907 thousand rubles.
Based on the calculations carried out for 2015, it can be judged that in 2015 the current liquidity condition is also not met.
Comparing indicators A 3 and P 3, we can say that in 2013 their value meets the requirements. However, for both 2014 and 2015, it can be seen that the long-term liquidity condition for the balance sheet of Vosstanovleniye LLC is also not met.
The balance sheet liquidity analysis carried out according to the above scheme is approximate. A more detailed analysis of solvency using financial ratios(Appendix 11). For analysis purposes, you can use the methodological provisions for assessing the financial condition of enterprises and establishing an unsatisfactory balance sheet structure, which defines a system of criteria for identifying insolvent enterprises.
Let us present the calculation of the indicators of Appendix 11 in 2013, 2014 and 2015.
Current ratio:
2013: (62+23163+13430) / (30233+160) = 1.21.
2014: (23+23866+5471) / (23905+2056) = 1.13.
2015: (203+16071+6281) / (23926+981) = 0.91.
Quick liquidity ratio:
2013: (62+23163) / (30233+160) = 0.76.
2014: (23+23866) / (23905+2056) = 0.92.
2015: (203+16071) / (23936+981) = 0.65.
Absolute liquidity ratio:
2013: 62/(30233+160) = 0.002.
2014: 23/(23905+2056) = 0.0009.
2015: 203/(23926+981) = 0.008.
Total liquidity ratio:
2013: (62+23163+13430+7977)/(30233+160+9915) = 1.107.
2014: (23+23866+5471+16883)/(23905+2056+15659) = 1.11.
2015: (203+16071+6281+15773)/(23926+981+13194) = 1.006.
The current liquidity ratio shows the possibility of repaying the most urgent and short-term obligations using current assets. The current liquidity ratio characterizes the solvency of the enterprise.
Based on the calculated indicators of this coefficient for 2013, 2014 and 2015, we can conclude that in 2013 and 2014 this indicator was within the normal range. In 2015, the current liquidity ratio did not meet the norm.
The quick liquidity ratio characterizes the company’s ability to repay its own debentures at the expense of available cash, financial investments and receivables.
Based on the calculation of the quick liquidity ratio in 2013, 2014 and 2015, we can say that in all three cases the value of this indicator corresponds to the norm.
The absolute liquidity ratio shows the ability of an enterprise to liquid assets cover the volume of existing short-term liabilities.
According to the calculated data, it can be said that the absolute liquidity ratio in 2013, as well as in 2014 and 2015, does not correspond to the norm.
The total liquidity ratio characterizes the ability of an enterprise to pay off all obligations at the expense of its assets.
Calculations show that the total liquidity ratio of Vosstanovlenie LLC in 2013, 2014 and 2015 also does not meet the required indicators.
If the balance sheet structure is unsatisfactory, to check the real possibility of the enterprise to restore its solvency, the solvency restoration coefficient is calculated for a period of 3 months:
K VOST = (K TLinit + 3/T * (K TLcon - K TLinit)) / 2 (2.4)
where K TLnach, K TLkon - actual value current liquidity ratio at the beginning and end of the reporting period;
3 - period of restoration of solvency, months;
T - reporting period, month;
2 - standard value of the current liquidity ratio.
If the recovery factor is less than 1, then the enterprise has no real opportunity to restore solvency in the next 6 months if it does not change anything in its activities.
A value of the recovery coefficient greater than 1 indicates that the enterprise has a real opportunity to restore its solvency.
Let's calculate the solvency recovery coefficient in 2014:
K VOST (2014) = (1.21+ 3 / 12 * (1.13 - 1.21)) / 2 = 0.6
Let's calculate the solvency recovery rate in 2015:
K VOST (2015) = (1.13+ 3 / 12 * (0.91 - 1.13)) / 2 = 0.52
As can be seen from the calculation, the solvency restoration coefficient is less than 1, which indicates that the company cannot restore its solvency.
Debt to equity ratio;
The coefficient of maneuverability of own funds;
Autonomy coefficient.
The indicators calculated according to this algorithm are presented in Appendix 12.
Let's consider the calculation of coefficients for Appendix 12 in 2013, 2014 and 2015.
Debt to equity ratio:
2013: (30233+160+9915)/ 4324 = 9.32
2014: (23905+2056+15659)/4623 = 9.
2015: (23926+981+13194)/226 = 169.
Maneuverability coefficient of own working capital:
2013: ((62+23163+13430) - (30233+160))/ 4324 = 1.45
2014: ((23+23866+5471) - (23905+2056))/4623 = 0.74
2015: ((203+16071+6281) - (23926+981))/226 = -10.4
Autonomy ratio:
2013: 4324/44632 = 0.1.
2014: 4623/46243 = 0.1.
2015: 226/38327 = 0.006.
The ratio of equity and borrowed funds shows which funds the enterprise has more.
This coefficient in both 2013, 2014, and 2015 exceeds the permissible values. In 2013, for every 1 ruble of its own funds, the company had 9.32 rubles of borrowed funds. In 2014, for every 1 ruble of its own funds, the company had 9 rubles of borrowed funds. This figure became even higher in 2015. For 1 ruble of own funds there were already 169 rubles of borrowed funds.
This ratio suggests that Vosstanovlenie LLC is seriously dependent on borrowed funds.
The coefficient of maneuverability of own working capital shows what part of own funds is in mobile form, which allows you to manage these funds quite freely.
This indicator, both in 2013 and in 2014 and in 2015, does not correspond to the standard value.
The autonomy coefficient shows the share of own funds in total assets and characterizes the degree financial independence enterprises from borrowed sources of financing.
The value of this indicator is significantly lower than the standard value both in 2013 and in 2014 and 2015. Moreover, in 2015 this indicator decreased significantly.
This indicates that the company has serious problems with the availability of its own funds, and it is almost completely dependent on borrowed funds.
To further analyze the results of the financial and economic activities of Vosstanovlenie LLC, it is necessary to calculate profitability and business activity indicators.
Business activity ratios:
1. Turnover ratio of current assets (K oOA) - shows the number of turnovers made by assets during the analyzed period.
2. Accounts receivable turnover ratio (K receivables) - shows the number of turnovers made by accounts receivable for the analyzed period. As turnover accelerates, the value of the indicator decreases, which indicates an improvement in settlements with debtors.
3. Equity capital turnover ratio (K oSC) - reflects the activity of using one’s own financial resources. Growth in dynamics means an increase in the efficiency of using equity capital.
4. Accounts payable turnover ratio (K oKZ) - shows the speed of settlements with creditors. Acceleration has an adverse effect on the liquidity of the enterprise.
5. Capital productivity (F O) - reflects the efficiency of using the enterprise's fixed assets.
Financial profitability ratios:
1. Overall profitability ratio (R O) - shows the profitability of the enterprise itself.
2. Return on sales ratio (R P) - shows how much profit is per unit products sold.
3. Return on assets ratio (R A) - shows the efficiency of using all property (enterprise management in the field of production activities).
4. Direct cost profitability ratio (R PZ) - characterizes the cost efficiency of the enterprise, i.e. what profit does the company receive from each ruble of direct costs incurred?
5. Return on equity capital (R SK) - shows the efficiency of using equity capital.
Let's consider the procedure for calculating these indicators.
The turnover ratio of current assets will be calculated using the formula:
K oOA = BP / OA avg, (2.5)
where VR is sales revenue,
OA avg - average value current assets.
Let's calculate the value of this indicator:
2014: 55283 / ((29360+22554)/2) = 2.13.
2015: 50659 / ((29360+22554)/2) = 1.95.
We calculate the accounts receivable turnover ratio using the formula:
K oDZ = VR / DZ avg, (2.6)
DZ av - the amount of accounts receivable.
2014: 55283 / ((23866+16071)/2) = 2.77.
2015: 50659 / ((23866+16071)/2) = 2.54.
We calculate the equity capital turnover ratio using the formula:
K oSK = VR / SK avg, (2.7)
where VR is sales revenue;
SK avg is the average amount of equity capital.
2014: 55283 / ((4623+226)/2) = 22.8.
2015: 50659 / ((4623+226)/2) = 20.9.
The accounts payable turnover ratio is calculated using the formula:
K oKZ = VR / KZ sr, (2.8)
where VR is sales revenue;
KZ av - the amount of accounts payable.
2014: 55283 / ((23905+23926)/2) = 2.31.
2015: 50659 / ((23905+23926)/2) = 2.12.
We will determine capital productivity using the following formula:
F O = VR / OS sr, (2.9)
where VR is sales revenue;
OS av - average annual cost of fixed assets.
2014: 55283 / ((5783+5770)/2) = 4.79.
2015: 50659 / ((5783+5770)/2) = 4.38.
We calculate the overall profitability ratio using the formula:
R O = P N / BP * 100%, (2.10)
where P N - profit (loss) before tax;
VR - sales revenue.
2014: (373/55283) * 100% = 0.67%
2015: (270/50659) * 100%= 0.53%.
We calculate the return on sales ratio using the formula:
R P = P r / BP * 100%, (2.11)
where P r - profit from sales of products;
VR - sales revenue
2014: (871/55283) * 100% = 1.58%
2015: (3028/50659) * 100%= 6%.
We calculate the return on assets ratio using the formula:
R A = PE / VB avg * 100%, (2.12)
where PE is net profit;
WB avg - average balance sheet currency.
2014: (299/((46243+38327)/2) * 100% = 0.71%
2015: (216/((46243+38327)/2) * 100%= 0.51%.
The profitability ratio of direct costs is calculated using the formula:
R PZ = VP / SP * 100%, (2.13)
where VP is gross profit (loss);
SP - cost of sales.
2014: (871/54412)* 100% = 1.6%
2015: (4286/46373) * 100%= 9.24%.
Return on equity is calculated using the formula:
R SK = PE / SK * 100%, (2.14)
where PE is net profit,
SK - equity capital.
2014: (299/4623)* 100% = 6.47%
2015: (216/226) * 100%= 95.58%.
We present the obtained indicator values for Vosstanovlenie LLC in Appendix 13.
Considering the obtained values, the following conclusions can be drawn.
The turnover ratio of current assets in the reporting period decreased from 2.13 to 1.95. This fact is due to the fact that in 2015, Vosstanovlenie LLC saw a slight decrease in sales revenue.
The accounts receivable turnover ratio also decreased from 2.77 in 2014 to 2.54 in 2015. The decrease in this indicator, as well as the previous one, can be explained by a decrease in sales revenue in 2015.
The equity turnover ratio in 2015 decreased to 20.9. In 2014, this indicator was 22.8.
The accounts payable turnover ratio for the period decreased slightly, not significantly. In 2014, this figure was 2.31, and in 2015 - 2.12.
Capital productivity also decreased from 4.79 in 2014 to 4.38 in 2015.
The overall profitability ratio in 2014 was 0.67. In 2015, this figure was 0.53.
The return on sales ratio in 2014 was 1.58%. In 2015, this figure increased and amounted to 6%. This is due to the fact that such an indicator as profit from product sales in 2015 increased against the background of a slight decrease in sales revenue.
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The methodology for analyzing financial and economic activities is a set of analytical procedures used to determine the financial and economic condition of an enterprise. Experts in the field of analysis provide different methods for determining the financial and economic condition of an enterprise. However, the basic principles and sequence of the procedural side of the analysis are almost the same with minor differences. The detailing of the procedural side of the methodology for analyzing financial and economic activities depends on the goals set and various factors of information, methodological, personnel and technical support. Thus, there is no generally accepted methodology for analyzing the financial and economic activities of an enterprise, but in all significant aspects the procedural aspects are similar.
It is important for the analysis Information Support. This is due to the fact that, in accordance with the Law of the Russian Federation “On Informatization and Information Protection,” an enterprise may not provide information containing a trade secret. But usually, for many decisions to be made by potential partners of a company, it is sufficient to conduct an express analysis of financial and economic activities. Even to conduct a detailed analysis of financial and economic activities, information constituting a trade secret is often not required. To conduct a general detailed analysis of the financial and economic activities of an enterprise, information on established forms financial statements, namely:
Form No. 1 Balance Sheet
Form No. 2 Profit and Loss Statement
Form No. 3 Statement of capital flows
Form No. 4 Cash Flow Statement
Form No. 5 Appendix to the balance sheet
This information is in accordance with the Decree of the Government of the Russian Federation of December 5, 1991. No. 35 “On the list of information that cannot constitute a trade secret” cannot constitute a trade secret.
The analysis of the financial and economic activities of the enterprise is carried out in three stages.
At the first stage, a decision is made on the feasibility of analysis financial statements and her readiness for reading is checked. The problem of the feasibility of the analysis can be solved by reading the auditor's report. There are two main types of audit reports: standard and non-standard. Standard audit report is a unified, concise document containing a positive assessment of the audit firm about the reliability of the information presented in the report and its compliance with current regulatory documents. In this case, analysis is advisable and possible, since reporting in all significant aspects objectively reflects the financial and economic activities of the enterprise.
A non-standard audit report is issued when audit firm cannot draw up a standard audit report for a number of reasons, namely: some errors in the company’s financial statements, various uncertainties of a financial and organizational nature, etc. In this case, the value of the analytical conclusions drawn up from these reports is reduced. Checking the readiness of reporting for reading is of a technical nature and is associated with a visual check of the presence of the necessary reporting forms, details and signatures on them, as well as a simple counting check of subtotals and balance sheet currency.
The purpose of the second stage is to familiarize yourself with the explanatory note to the balance sheet; this is necessary in order to assess the operating conditions of the enterprise in a given reporting period and take into account the factors in the analysis, the impact of which led to changes in the property and financial position of the organization and which are reflected in the explanatory note.
The third stage is the main one in the analysis of economic activity. The purpose of this stage is to assess the results of economic activity and the financial condition of the business entity. It should be noted that the level of detail in the analysis of financial and economic activities may vary depending on the goals set. At the beginning of the analysis, it is advisable to characterize the financial and economic activities of the enterprise, indicate industry affiliation and other features. If there are amounts for these items, it is necessary to study the reasons for their occurrence. Sometimes the information in in this case only further analysis can provide and final conclusions can be drawn later.
Analysis of the financial and economic condition of an enterprise consists, in general, of the following main components: Analysis of property status, liquidity analysis, financial stability analysis, business activity analysis, profitability analysis.
These components are closely interconnected and their separation is necessary only for a clearer separation and understanding of the conclusions on the analytical procedures for analyzing the financial and economic activities of the organization.
Analysis of property status consists of the following components: analysis of assets and liabilities of the balance sheet, analysis of indicators of property status.
When analyzing the assets and liabilities of the balance sheet, the dynamics of their condition in the analyzed period is traced. It should be borne in mind that in conditions of inflation, the value of analysis based on absolute indicators is significantly reduced, and in order to neutralize this factor, analysis should also be carried out using relative indicators of the balance sheet structure. When assessing the dynamics of property, the state of all property in the composition of immobilized assets (Section I of the balance sheet) and mobile assets (Section II of the balance sheet - inventories, receivables, other current assets) is traced at the beginning and end of the analyzed period, as well as the structure of their increase (decrease).
Analysis of property status indicators consists of calculating and analyzing the following main indicators:
The amount of economic assets at the disposal of the enterprise. This indicator gives a generalized valuation of assets listed on the balance sheet of the enterprise.
Share of the active part of fixed assets. The active part of fixed assets should be understood as machines, machines, equipment, vehicles and so on. The growth of this indicator is considered a positive trend.
Wear rate. It characterizes the degree of depreciation of fixed assets as a percentage of initial cost. Its high value is an unfavorable factor. The addition of this indicator to 1 is the suitability coefficient.
Renewal ratio - shows what part of the fixed assets available at the end of the period is made up of new fixed assets.
Retirement ratio - shows what part of fixed assets left economic circulation during the reporting period due to wear and tear.
The analysis of enterprise liquidity is based on the calculation of the following indicators:
Maneuverability of functioning capital. Characterizes that part of own working capital that is in the form of cash, i.e. funds with absolute liquidity. For a normally functioning enterprise, this indicator usually varies from zero to one. Other than that equal conditions the growth of the indicator in dynamics is considered as a positive trend. An acceptable indicative value of the indicator is established by the enterprise independently and depends, for example, on how high the enterprise’s daily need for free cash resources is.
Current ratio. Gives a general assessment of the liquidity of assets, showing how many rubles of the enterprise's current assets account for one ruble of current liabilities. The logic for calculating this indicator is that the enterprise repays Short-term liabilities mainly due to current assets; therefore, if current assets exceed in value Current responsibility, the enterprise can be considered as successfully operating (according to at least, in theory). The size of the excess is set by the current liquidity ratio. The value of the indicator may vary by industry and type of activity, and its reasonable growth in dynamics is usually considered as a favorable trend. In Western accounting and analytical practice, the critical lower value of the indicator is -2; however, this is only an indicative value, indicating the order of the indicator, but not its exact normative value.
Coefficient quick liquidity. In terms of semantic purpose, the indicator is similar to the current liquidity ratio; however, it is calculated based on a narrower range of current assets, when the least liquid part of them, industrial inventories, is excluded from the calculation. The logic of such an exception is not only that the liquidity of inventories is significantly lower, but, what is much more important, is that cash, which can be rescued in case of forced sale inventories, can be significantly lower than the costs of their acquisition. In particular, in a market economy, a typical situation is when, upon liquidation of an enterprise, 40% or less of the book value of inventories is gained. Western literature provides an approximate lower value of -1, but this estimate is also conditional. In addition, when analyzing the dynamics of this coefficient, it is necessary to pay attention to the factors that determined its change.
Absolute liquidity (solvency) ratio. It is the most stringent criterion for the liquidity of an enterprise; shows what portion of short-term debt obligations can be repaid immediately if necessary. The recommended lower limit of the indicator given in Western literature is 0.2. In domestic practice, the actual average values of the liquidity ratios considered are, as a rule, significantly lower than the values mentioned in Western literature. Since the development of industry standards for these coefficients is a matter of the future, in practice it is desirable to analyze the dynamics of these indicators, supplementing it with a comparative analysis of available data on enterprises that have a similar orientation of their economic activities.
The share of own working capital in covering inventories. Characterizes that part of the cost of inventories that is covered by its own working capital. Traditionally, it is of great importance in analyzing the financial condition of trading enterprises; the recommended lower limit of the indicator in this case is 50%.
Inventory coverage ratio. It is calculated by correlating the value of “normal” sources of inventory coverage and the amount of inventory. If the value of this indicator is less than one, then the current financial condition of the enterprise is considered unstable. One of the most important characteristics of the financial condition of an enterprise is the stability of its activities in the light of a long-term perspective. It is related to the overall financial structure of the enterprise, the degree of its dependence on creditors and investors. Financial stability in the long term is characterized, therefore, by the ratio of equity and borrowed funds. However, this indicator provides only a general assessment of financial stability. Therefore, a system of indicators has been developed in global and domestic accounting and analytical practice.
Equity concentration ratio. Characterizes the share of the owners of the enterprise in the total amount of funds advanced for its activities. The higher the value of this coefficient, the more financially sound, stable and independent of external loans the enterprise is. An addition to this indicator is the concentration ratio of attracted (borrowed) capital - their sum is equal to 1 (or 100%).
Financial dependency ratio. It is the inverse of the equity concentration ratio. The growth of this indicator in dynamics means an increase in the share of borrowed funds in the financing of the enterprise. If its value drops to one (or 100%), this means that the owners are fully financing their enterprise.
Equity capital agility ratio. Shows what part of equity capital is used to finance current activities, i.e. invested in working capital, and what part is capitalized. The value of this indicator can vary significantly depending on the capital structure and industry sector of the enterprise.
Long-term investment structure coefficient. The logic for calculating this indicator is based on the assumption that long-term loans and borrowings are used to finance fixed assets and other capital investments. The ratio shows what part of fixed assets and other non-current assets is financed by external investors, i.e. (in a sense) belongs to them, and not to the owners of the enterprise.
Ratio of own and borrowed funds. Like some of the above indicators, this ratio provides the most general assessment of the financial stability of an enterprise. It has a fairly simple interpretation: its value, equal to 0.25, means that for every ruble of own funds invested in the assets of the enterprise, there are 25 kopecks. Borrowed money. The growth of the indicator in dynamics indicates an increased dependence of the enterprise on external investors and creditors, i.e., a slight decrease in financial stability, and vice versa.
Indicators of the business activity group characterize the results and efficiency of current core production activities.
General indicators for assessing the efficiency of using an enterprise's resources and the dynamism of its development include the resource productivity indicator and the coefficient of sustainability of economic growth. Resource productivity (turnover ratio of advanced capital). Characterizes the volume of products sold per ruble of funds invested in the activities of the enterprise. The growth of the indicator in dynamics is considered as a favorable trend.
Economic growth sustainability coefficient. Shows the average rate at which an enterprise can develop in the future, without changing the already established relationship between various sources of financing, capital productivity, profitability of production, etc.
The detailing of the procedural side of the methodology for assessing the financial and economic condition depends on the goals set, as well as on various factors of information, time and technical support and is carried out in two stages: preliminary assessment, that is, express analysis, detailed analysis of the financial condition. Therefore, the main goal of express analysis is a clear and simple general assessment of the financial situation and dynamics of economic development of the enterprise. The point of this analysis is to select a small number of significant and relatively simple to calculate indicators and constantly monitor them over time. Its quality depends on the applied financial analysis methodology, the reliability of the financial statements, as well as on the competence of the person making the management decision.
A detailed analysis of the financial condition is a more detailed description of the property and financial position of an economic entity, the results of its activities in the past reporting period, as well as the development opportunities of an economic entity for the future. It specifies, complements and expands individual procedures express analysis, and also makes it possible to make forecasts of financial condition.
Assessing the financial condition of an enterprise in a market economy and achieving the goals of financial analysis is carried out using a certain method. The method of financial analysis is a system of theoretical and cognitive categories, scientific tools and regulatory principles for studying the activities of business entities, that is, a triad:
Method = (K,I,P), (1)
where K is the system of financial categories;
I – scientific financial tools;
P – system of regulatory financial principles.
The first two elements characterize the static component of the financial analysis method, the last element - its dynamics.
The categories of financial analysis are the most general, key concepts of this science. These include: factor, model, rate, interest, discount, cash flow, risk, etc. The scientific tools of financial analysis are a set of general scientific and specific scientific methods for studying the financial activities of business entities.
The main element of the method of any science is its scientific apparatus. Currently, it is almost impossible to isolate the techniques and methods of any science as inherent exclusively to it - there is an interpenetration of scientific tools of various sciences. Financial analysis can also use various methods that were originally developed within the framework of a particular economic science. Exist various classifications methods of economic analysis. The first level of classification of financial analysis classification methods distinguishes informal and formalized methods.
Formalized methods include analysis methods that are based on fairly strict analytical dependencies between financial indicators. They constitute the second level of classification and include:
Classic methods analysis of economic activity and financial analysis: chain substitutions, arithmetic differences, balance sheet, highlighting the isolated influence of factors, differential, integral, simple and compound interest, discounting;
Mathematical and statistical methods for studying relationships: correlation analysis, regression analysis, variance analysis, factor analysis, principal component method, covariance analysis, cluster analysis and etc.;
Non-formalized methods of financial analysis and assessment of the financial condition of an enterprise are based on a description of analytical procedures at a logical level, and not on strict analytical dependencies of the analyzed economic indicators. These include methods: expert assessments, psychological, morphological, construction of systems of financial indicators, analytical tables, etc. The use of these methods in economic analysis is characterized by a certain subjectivity, since the intuition, experience and knowledge of the analyst are of great importance.
Formalized methods include analysis methods that are based on strict analytical dependencies between financial indicators. They constitute the second level of classification and include:
Classical methods of analysis of economic activity and financial analysis: chain substitutions, balance sheet, isolating the isolated influence of factors, percentage numbers, differential, logarithmic, integral, simple and compound interest, discounting;
Mathematical and statistical methods for studying relationships: correlation analysis, regression analysis, variance analysis, factor analysis, principal component method, covariance analysis, cluster analysis;
Traditional methods economic statistics: average and relative values, grouping, graphical research, index method, elementary methods for processing dynamics series;
Econometric methods: matrix methods, harmonic analysis, spectral analysis, methods of the theory of production functions, methods of the theory of input-output balance;
Operations research methods and decision theory: graph theory methods, tree method, Bayesian analysis method, game theory, queuing theory, network planning and management methods.
Not all of the listed methods are directly used within the framework of financial analysis and assessment of financial condition, but some of their elements are already used in practice. In particular, this applies to methods of discounting, machine simulation, factor analysis, and processing of time series. The detail of the procedural side of the financial condition analysis methodology depends on the goals set, as well as on various factors of information, time, personnel and technical support.
Makarieva V.I. proposes to additionally include spatial analysis in this structure - a comparative analysis of consolidated financial indicators of accounting statements by constituent elements, that is, indicators of reporting of subsidiaries, structural divisions, workshops and sites. On the contrary, O.V. Efimova together with M.V. Melnik gives the predominant role to the balance method and other identical methods used in modern practice of economic analysis.
Since financial analysis is associated with a logical process, its relative importance in making investment decisions changes depending on the circumstances prevailing in the market. Its significance is always greater when the analysis is aimed at assessing risk, identifying bottlenecks and potential problems, which also takes into account the fact that the solution includes a very large set of factors, that is, the characteristics of the industry, the abilities and qualifications of management, economic conditions. An analytical review of financial reporting data should reproduce all the main aspects of economic activity and completed transactions in a generalized form, that is, with the degree of aggregation necessary for analysis.
The main results of effective analysis and financial management are formed using special financial ratios. The practice of financial analysis has developed a methodology for analyzing accounting financial reports. Among them there are six main methods:
Vertical analysis - determining the structure of the final financial indicators and identifying the impact of each reporting position on the result as a whole;
Horizontal analysis - comparing each financial statement item with previous period and definition dynamic changes;
Analysis of relative indicators - calculating the relationships between individual items of the financial report and determining the relationships between indicators;
Trend analysis - comparison of each reporting item with a number of previous periods and determination of the trend, that is, the main trend in the dynamics of the indicator, cleared of random influences and individual characteristics separate periods. Using the trend, predictive analysis is carried out;
Comparative analysis - intra-farm analysis of financial indicators of structural divisions and inter-farm analysis of the indicators of a given enterprise with the financial indicators of competitors;
Factor analysis is an analysis of the influence of individual factors on a performance indicator using deterministic or stochastic techniques.
The main tool for analyzing financial condition is to determine the relative values of dynamics and structure:
Relative values of dynamics - characterize changes in the process over time, show how many times the level of the studied indicator has increased or decreased compared to the previous period of time;
dynamics coefficient = P 1 / P 0 (2)
growth rate, % = P 1 / P 0 x 100% (3)
growth rate, %= (P 1 / P 0 x 100%) - 100% (4)
where P 0 is the value of the absolute indicator in the base period;
P 1 - the value of the absolute indicator in the reporting period;
- relative values of the structure - characterize the share of a separate part in the total volume of the aggregate:
specific gravity, % = P i / P n x 100% (5)
where P i is the value of a separate part of the population;
P n - the entire set, that is, a single whole.
At the core vertical analysis lies a different presentation of reporting - in the form of relative values characterizing the structure of generalizing indicators. An obligatory element of the analysis is the dynamic series of these quantities, which makes it possible to track and predict structural changes in the composition of economic assets and the sources of their coverage. Horizontal analysis allows us to identify trends in changes in individual items or their groups included in the financial statements. This analysis is based on the calculation of the basic growth rates of balance sheet items or income statement items.
1. Liquidity analysis. The indicators of this group allow us to describe and analyze the ability of the enterprise to meet its obligations. The algorithm for calculating these indicators is based on the idea of comparing current assets with short-term debt. As a result of the calculation, it is established whether the enterprise is sufficiently provided with working capital necessary for settlements with creditors for current operations. Since different types of current assets have different degrees of liquidity, several liquidity ratios are calculated.
The current liquidity ratio (CTL) shows the payment capabilities of the enterprise, assessed subject to timely settlements with debtors and favorable sales of goods, but also the sale of other elements of material current assets. It characterizes the expected solvency for a period equal to average duration turnover.
The critical value of the lower limit is as follows: Ktl>= 2
The critical liquidity ratio (CLR) reflects the predicted payment capabilities, subject to timely settlements with debtors. It characterizes the expected solvency for a period equal to the average duration of one turnover of receivables.
The assessment of the lower normal limit is as follows: Kcl not less than 1.
The absolute liquidity ratio (Kal) is the most stringent criterion for the liquidity of an enterprise. Shows what portion of short-term debt obligations can be repaid immediately if necessary.
The normal limit for this indicator is as follows: Cal >= 0.2-0.3
3. Analysis of financial stability. Using these indicators (coefficients of autonomy (financial independence), financial stability, financial dependence, financing), the composition of funding sources is assessed, and the dynamics of the relationship between them, the analysis is based on the fact that sources of funds differ in the level of cost, degree of accessibility, level of reliability, degree risk, etc. To assess the dynamics of the capital structure, the following financial ratios are calculated:
The coefficient shows in what proportion the assets of the enterprise are financed by own sources funds. The opposite of this indicator is the financial dependence ratio:
These ratios, taken together, characterize the capital structure, as well as the claims of creditors regarding the property of the enterprise. Therefore, a decrease in the level of the first and, accordingly, an increase in the second coefficient indicates an increase in the financial risk of the organization. Acceptable values of these coefficients in different fields of activity are ambiguous, which, first of all, depends on the ability of individual enterprises to generate a sufficient amount of funds to service creditors. A modification of the considered indicators is the financial leverage ratio:
Shows how much borrowed funds are raised per ruble of an organization’s equity capital and is most often used to justify management decisions to optimize the structure of sources of funds in order to obtain additional profit directed toward increasing equity capital.
To characterize the security of assets with long-term sources of financing, the financial stability coefficient is calculated:
The value of the coefficient should be quite high, since the financial condition of the enterprise will be considered stable if due to long-term sources investments in non-current assets and current assets belonging to the third class of liquidity are fully covered.
3. Analysis of current activities. From the perspective of the circulation of funds, the economic activity of any enterprise is a process of continuous transformation of one type of asset into another:
DS => SS => NP => GP => SR => DS, (9)
where DS is cash;
СС – raw materials in warehouse;
WP – work in progress;
GP – finished products;
SR – funds in settlements.
The effectiveness of current activities can be assessed by the length of the operating cycle, which depends on the turnover of funds in various types of assets. All other things being equal, faster turnover indicates increased efficiency. Therefore, the main indicators of this group are indicators of the use of material, labor and financial resources: production, capital productivity, turnover ratios.
4. Analysis of the situation and activities in the capital market. As part of this analysis, spatio-temporal comparisons are made of indicators characterizing the company’s position on the securities market: dividend income, earnings per share, share value. This piece of analysis is performed primarily on companies that are listed on securities exchanges and trade their shares there. Any enterprise that has temporarily free funds and wants to invest them in securities, also focus on the indicators of this group.
VR = PZ + FZ + P, (16)
where VR is the volume of production or sales revenue;
PV – total variable costs enterprises;
FZ – total fixed costs of the enterprise;
P is the profit of the enterprise’s production activities.
The analysis of values at the critical point is based on the relationship “volume – costs – profit”. The critical point is the point at which the total sales revenue equals the total costs.
5. Cost-benefit analysis. Indicators in this group are intended to assess the overall effectiveness of investments in this enterprise. Unlike the indicators of the second group, they differ from specific types of assets, but analyze the return on capital of the enterprise as a whole. The main indicators are therefore return on advanced capital and return on equity.
Return on capital characterizes the extent to which equity capital increases due to the profits remaining at the disposal of the enterprise after taxes and can be used to pay dividends and increase the organization's assets.
Return on assets reflects the efficiency of current activities related to the production and sale of products and the efficiency of use of total assets, and the relationship can be represented in the formulas:
Changing the value of your own working capital must correspond to the increase or decrease in the volume of production and sales of products.
Normative models. Models of this type allow you to compare the actual results of enterprises with the expected ones calculated according to the budget. These models are used mainly in internal financial analysis. Their essence comes down to the establishment of standards for each cost item for technological processes, types of products, responsibility centers, and to the analysis of deviations of actual data from these standards. The analysis is largely based on the use of strictly deterministic models.
Decision-making using the above methods, models, and estimates is carried out as a result of the analysis of alternative solutions that take into account the compromise between the requirements of liquidity, financial stability and profitability. The assessment of the financial condition of an enterprise covers a large number of interrelated issues and factors that ultimately determine the final results of the enterprise’s economic activities in modern conditions economic development. Financial analysis is the basis on which the development of promising financial policy enterprises.
Analysis of financial condition is based on indicators of quarterly and annual financial statements, when it is still possible to change a number of balance sheet items, and is needed for drawing up explanatory note To annual report. Based on the data of the final financial analysis, almost all areas of organizing the finances of the enterprise are developed, and the effectiveness of management decisions depends on how well it is carried out. The quality of the financial condition assessment depends on the methodology used, the reliability of reporting data, as well as the competence of the person making the decision in the field of financial policy.
Analysis of the financial statements of an enterprise allows us to identify relationships and interdependencies between various indicators of its financial and economic activities included in the statements. The results of the analysis allow interested individuals and organizations to make management decisions based on an assessment of the current financial situation and activities of the enterprise for previous years and its potential capabilities for the coming years.
To analyze the financial condition of a commercial enterprise, a system of absolute and relative indicators, as well as financial ratios associated with their measurement, is used. The most important of them are indicators characterizing:
Solvency - the ability of an enterprise to pay its obligations;
Financial stability - the state of financial resources, their distribution and use, ensuring the development of the enterprise based on the growth of profits and capital while maintaining solvency and creditworthiness under an acceptable level of risk;
Business activity - the efficiency of the enterprise's use of its funds;
Profitability (profitability) - the level of profit relative to the invested funds or costs of the enterprise;
Efficiency of use of own (share) capital.
The calculation of financial ratios is based on determining the relationships between individual reporting items. The general methodology for such analysis is to compare the calculated coefficients with industry average norms, generally accepted standard coefficients or similar activity data for a number of years.
Compiling a comparison table in two last year identifying absolute and relative (in percentage) deviations in the main reporting indicators;
Calculation of relative indicators for several years as a percentage relative to the base year;
Calculation of indicators for a number of years as a percentage of any final indicator (for example, the balance sheet total, the volume of products sold);
Study and analysis of coefficients, the calculation of which is based on the existence of certain relationships between individual reporting items.
The wide distribution and use of coefficients is of interest due to the fact that they eliminate the distorting influence of inflation on the reporting material, which is especially important when analyzing from a long-term perspective.
Solvency analysis
The solvency indicator characterizes the company's ability to fulfill its debt obligations. The calculation and analysis of this indicator is of great importance for the enterprise, since its low potential may be a reason for it to stop making payments. The analysis process examines current and long-term solvency.
Current solvency can be determined from the balance sheet by comparing the amount of its means of payment with current liabilities. The best option is when the company always has available funds sufficient to pay off existing obligations. But an enterprise is solvent even in the case when it has insufficient free cash or no funds at all, but the enterprise is able to quickly realize its assets and pay off creditors.
The most common means of payment include cash, short-term securities, and part of accounts receivable for which there is confidence in its receipt. Current liabilities include obligations and debts subject to repayment: short-term bank loans, accounts payable for goods and services to the budget. The solvency of an enterprise is indicated by the ratio of means of payment to urgent obligations. If this ratio is less than 1, then there is a possibility that the company will not be able to repay its short-term debt on time. This issue can be resolved during the analysis process additional information on the timing of payment of accounts payable, receipt of accounts receivable, etc.
The solvency of an enterprise is assessed by liquidity indicators. There are two known concepts of liquidity. According to one of them, liquidity refers to the ability of an enterprise to pay its short-term obligations. According to another concept, liquidity is the readiness and speed with which current assets can be converted into cash. At the same time, the degree of depreciation of current assets as a result of their rapid disposal should also be taken into account.
A low level of liquidity means a lack of freedom of action for the enterprise administration. A more serious consequence of low liquidity is the inability of a company to pay its current debts and obligations, which can lead to the forced sale of long-term financial investments and assets and, ultimately, to non-payments and bankruptcy.
Solvency is often determined by balance sheet liquidity. Analysis of balance sheet liquidity consists of comparing assets, grouped by the degree of their liquidity and arranged in descending order of liquidity, with liability obligations, grouped by their maturity and in ascending order.
Depending on the degree of liquidity, that is, the rate of conversion into cash, the assets of the enterprise are divided into the following groups:
And 1 - the most liquid. These include all funds (cash and accounts) and short-term financial investments. Cash is absolutely liquid.
And 2 - quickly implemented. This includes accounts receivable and other current assets.
A 3 - slow to implement. These include inventories, with the exception of the items “Deferred expenses”, as well as “Long-term financial investments”.
And 4 are difficult to implement. This intangible assets, fixed assets, construction in progress.
Liabilities are grouped according to the degree of urgency of their payment.
P 1 - the most urgent. These include accounts payable and other short-term liabilities.
P 2 - short-term. These include borrowed funds from the "Short-term liabilities" section.
P 3 - long-term. This includes long-term debt and other long-term liabilities.
P 4 - constant. They include the authorized capital and other items from the section “Capital and reserves”, as well as “Deferred income”, “Consumption funds” and “Reserves” upcoming earnings and expenses."
To maintain the balance of assets and liabilities, the total of this group is reduced by the amount of the items “Deferred expenses” and value added tax.
The balance is considered absolutely liquid if A1? P1, A2? P2, A 3? P 3, A 4? P 4. In the case when one or more inequalities of the system have a sign opposite to that fixed in the optimal option, the liquidity of the balance sheet differs to a greater or lesser extent from absolute. In this case, the lack of funds in one group of assets is compensated by their surplus in another group, although compensation in this case takes place only in value, since in a real payment situation less liquid assets cannot replace more liquid ones.
It is advisable to present the balance sheet items grouped together in the form of Table 6.
This assessment of liquidity is not final, since each passive group of the balance sheet may turn out to be backed by completely different active values than those indicated in the comparable group.
To more accurately assess balance sheet liquidity, it is necessary to analyze the following liquidity indicators:
The current liquidity ratio is calculated as the ratio of current (current) assets to current liabilities:
Current assets include inventories less deferred expenses, cash, accounts receivable and short-term investments. Current liabilities include borrowed funds (section "Current liabilities") and accounts payable.
The resulting indicator is compared with the average for groups of similar enterprises. It can be assumed that the higher this coefficient, the better position enterprises. But, on the other hand, an overestimated ratio may indicate excessive diversion of the enterprise’s own funds into various types of its assets and excess inventories.
Theoretically, a value of this indicator in the range of 2... 2.5 is considered sufficient, but depending on the forms of calculation, the speed of turnover of working capital, the duration of the production cycle, this value may be significantly lower, but they are assessed positively if the value is greater than 1.
Table 6. Analysis of enterprise liquidity
|
For the beginning of the year |
At the end of the year |
For the beginning of the year |
At the end of the year |
Payment surplus or deficiency -A - P |
|||||||
|
Amount, thousand rubles |
Amount, thousand rubles |
Amount, thousand rubles |
Amount, thousand rubles |
For the beginning of the year |
At the end of the year |
||||||
|
A 1 - the most liquid |
|||||||||||
|
A 2 - quickly implemented |
|||||||||||
|
A 3 - slow to implement |
|||||||||||
|
A 4 - difficult to implement |
|||||||||||
The quick liquidity ratio determines the ability of an enterprise to fulfill its current obligations from quickly liquid assets:
It shows what portion of short-term liabilities can be immediately repaid using cash, funds in short-term financial investments, and proceeds from settlements with customers.
The optimal value of this coefficient is 0.8...1. At equal to overall liquidity of two enterprises, the financial position is preferable to that of them that has a higher quick liquidity ratio.
The absolute liquidity ratio is calculated as the ratio of cash, short-term financial investments to current liabilities. It characterizes the ability of an enterprise to immediately pay off its short-term obligations using cash and easily realizable short-term financial investments. Theoretically, this indicator is considered sufficient if this value is above 0.2...0.25:
To assess current liquidity, net working capital is also used, which represents the excess of current assets over current liabilities. A working capital deficit will occur when current liabilities exceed current assets.
The calculation of liquidity indicators is the most critical stage of the analysis, therefore it is necessary to use information for a number of years, which will identify trends in their changes.
To assess long-term solvency (more than one year), the most important has profit and the ability to earn money, since these are the factors that determine the financial health of the enterprise.
To assess the ability of an enterprise to continuously generate profits from its activities in the future, the cash adequacy ratio of the KP is calculated. It reflects the company's ability to earn cash to cover capital expenditures, increase working capital and pay dividends. The numerator and denominator use 3-5 years of data.
A KP coefficient of 1 equal to one means that the enterprise is able to function without resorting to external financing.
Suppliers in these areas of industry are most large domestic enterprises. In addition, the organization successfully cooperates with a number of foreign suppliers from France, Switzerland, the USA, Germany, Sweden and Italy.
Of the closest competitors of NPO ELSIB OJSC, the most stable position of Power Machines OJSC is due to the execution of orders received in previous years. First of all, these are hydrogenerators of the Sayano-Shushenskaya and Boguchanskaya hydroelectric power stations, as well as turbogenerators of the type TZFP-225-2U3, which have been mastered in production.
The second most important domestic competitor of NPO ELSIB OJSC is Elektrotyazhmash-Privod LLC, which operates on the market under the brands Oil and Gas Systems LLC and United LLC trading house Drive-AZTPA".
Foreign competing companies include all the world leaders in power engineering: GE Energy, Siemens PG, Voith Hydro, ALSTOM Power, BRUSH, MITSIBUSHI Heavy Industry, HITACHI, TOSHIBA, Ansaldo Energy.
Due to the sharp decline in the market in the post-crisis period 2009 - 2011. competition in the market has intensified. The basis of penetration foreign companies is their possession of gas turbine technologies, which allows them to expand their presence in the Russian market, winning complete supplies and EPC (Engineering Procurement Construction contract, including engineering, supplies, construction), EPCM (Engineering Procurement Construction) Construction Management) contract, including engineering, supply, construction, project management) contracts.
Basic competitive advantages NPO "ELSIB" OJSC:
Many years of positive experience in operating the company’s products with customers, a long service life of the products;
Availability of design and technological personnel capable of developing and organizing development new technology, modernize the existing nomenclature;
Maintaining the full production cycle of manufacturing a high-quality product from product design to its installation on site and after-sales service;
Possible significant increase in demand in the Russian market for new generators for new construction of hydroelectric power stations and modernization of installed equipment, partially including complete replacement;
Extensive reference list;
Geographical location, due to the significant volume of construction in Siberia and the Far East.
To fulfill the tasks of the main production activities of NPO "ELSIB", OJSC has all the resources necessary for design and technological development and manufacturing of products:
The presence in the structure of the enterprise of design and technological departments that ensure the development of design and technological documentation, preparation of production with the necessary equipment and tools, and exercise supervision over the manufacture of products;
In accordance with technological process production is equipped with the necessary equipment, which is maintained in satisfactory condition in accordance with repair plans, checking for geometric accuracy;
Structural units enterprises are staffed with trained and trained personnel;
In the structure of the enterprise, the Quality Management division has been designated for organizing quality control of manufactured products.
total area The industrial site is 32 hectares. Located at Novosibirsk, st. Sibiryakov-Gvardeytsev, 56. There are access railway tracks and car roads. The site is supplied with electricity, gas, water and sewerage. Heat supply is provided from our own gas boiler house.
Consists of main buildings:
Main building, measuring 280×230 meters, variable height from 32 to 20 meters, equipped with lifting mechanisms with a lifting capacity from 5 to 125 tons;
The experimental building, measuring 138x144 meters, variable height from 32 to 10 meters, is equipped with cranes with a lifting capacity from 5 to 250 tons;
The tool building, measuring 138x144 meters, 7 meters high, is equipped with cranes with a lifting capacity of 3 to 5 tons;
The boiler room, the thermal power of which is 50 Gcal/hour, measures 68×42 meters and is 24 meters high.
The plant's equipment is maintained in satisfactory condition by planned overhauls, modernization, and overhaul maintenance and ensures the production of products in accordance with the requirements of the technology and the objectives of the production plan.
Special technological equipment manufactured in-house for the production of turbogenerators, hydrogenerators and large electrical machines has no analogues from machine tool manufacturers. This equipment was made in a single copy by the departments for the production of non-standard equipment and devices according to drawings developed by the design department of NPO ELSIB OJSC. This equipment is in satisfactory condition.
The company's workforce is approaching 2,000 people. The structure of the enterprise includes design and technological services that support the production process, development and modernization of products.
The number of shareholders as of 05/08/2013 is 786 persons.
Size authorized capital Companies – 112,000,000 rubles.
The total number of outstanding shares is 1,400,000.
Registered ordinary shares in uncertificated form.
There are no shares at the disposal of the Company.
The nominal value of 1 share is 80 rubles.
Preference shares are missing.
The general assessment indicator of the activity of a commercial organization is profit, which performs two important functions:
– characterizes the final financial results of the enterprise’s activities, the size of its cash savings;
– is the main source of financing costs for production and social development organizations.
Making a profit and maximizing it - the main objective economic activity any commercial enterprise. At the same time, profit is a complex calculation indicator, the value of which is influenced by many factors: types of income and expenses, their assessment, the moment of recognition of a specific expense, the degree of centralized control of the moment of recognition and the amount of income or expense, etc. These factors can also be influenced influence by making certain management decisions.
The assessment of the financial results of the activities of JSC Elsib is carried out according to the report on financial results(Appendix C, D) in table. 2.1.
Table 2.1 – Analysis of the results of financial and economic activities of OJSC Elsib for 2010-2012.
| Indicators | 2010 thousand rubles | 2011 thousand rubles | 2012 thousand rubles | Changes, thousand rubles | Growth rate, % | ||
| 2011/2010 | 2012/2011 | 2011/2010 | 2012/2011 | ||||
| Revenue | -158208 | 92,86 | 155,47 | ||||
| Cost price | -79636 | 94,45 | 170,80 | ||||
| Gross profit | -78572 | 89,93 | 125,85 | ||||
| Business expenses | -25922 | 67,05 | 123,00 | ||||
| Administrative expenses | 113,68 | 102,10 | |||||
| Revenue from sales | -111343 | 59,15 | 198,61 | ||||
| Interest receivable | -523 | -1560 | 80,46 | 27,54 | |||
| Percentage to be paid | -1663 | 107,73 | 98,62 | ||||
| Other income | 102,03 | 106,17 | |||||
| other expenses | -53524 | 77,44 | 154,91 | ||||
| Profit before tax | -63126 | 46,06 | 230,25 | ||||
| Income tax | -7801 | 29,73 | 1472,34 | ||||
| Net profit | -75392 | 21,83 | 381,53 |
From the data in table. 2.1 the following conclusions follow: 2011 was the least favorable year in the organization’s activities: the amount of revenue received decreased by 158,208 thousand rubles. and amounted to 92.86% of revenue in 2010. Cost also decreased, but to a lesser extent than revenue (94.45%), which negatively affected the amount of gross profit, which decreased by 78,572 thousand rubles. and amounted to 89.93% of gross revenue in 2010.
In 2012, the picture is more optimistic: revenue dynamics are positive, its growth rate in 2012 was 155.47%. The negative point is that the cost growth rate (170.80%) exceeds the revenue growth rate, which reduced the possible gross profit to 125.85% (Fig. 2.1).
Figure 2.1 – Dynamics of gross profit of OJSC Elsib for 2010-2012.
Height business expenses in 2012 by 23.0% and management expenses 2.1% lower than the growth rate of revenue, which had a positive effect on the amount of profit from sales, which increased by 159,008 thousand rubles. with a growth rate of 198.61% (Fig. 2.2).
Figure 2.2 – Dynamics of profit from sales of JSC Elsib for 2010-2012.
A positive trend is the reduction in the amount of interest payable in 2012 (98.62%).
The amount of other expenses exceeds the amount of other income, as a result of which the organization received a net profit in an amount less than it could have been: 96,448 thousand rubles. in 2010, 21,056 thousand rubles. in 2011, 80,336 thousand rubles. in 2012
In general, it should be noted that the size net profit is not a small value.
One of the goals of analyzing financial results is the analysis of the quality of profit, which is characterized by the following indicators:
1) Profit structure.
If a significant share in profit before tax is occupied by the result of other income and expenses, then this is a sign of low-quality profit, since this indicates the random sources of profit for the organization and, therefore, its unstable nature (Table 2.2).
Table 2.2 – Analysis of the profit structure of Elsib OJSC for 2010-2012.
| Indicators | year | year | year | Changes | Growth rate, % | ||
| 2011/2010 | 2012/2011 | 2011/2010 | 2012/2011 | ||||
| Total income | -154864 | 93,57 | 151,09 | ||||
| incl. revenue | -158208 | 92,86 | 155,47 | ||||
| Other income | 101,73 | 105,31 | |||||
| Share of revenue in total amount of income, % | 91,97 | 91,27 | 93,91 | -0,70 | 2,65 | 99,24 | 102,90 |
| Share of other income in total revenue, % | 8,03 | 8,73 | 6,09 | 0,70 | -2,65 | 108,71 | 69,70 |
| Total expenses | -91737 | 96,00 | 149,15 | ||||
| incl. from core activities | -46865 | 97,59 | 151,80 | ||||
| other expenses | -44872 | 87,15 | 132,62 | ||||
| Share of expenses from core activities in total amount of expenses, % | 84,77 | 86,17 | 87,71 | 1,40 | 1,53 | 101,66 | 101,78 |
| Share of other expenses in total expenses, % | 15,23 | 13,83 | 12,29 | -1,40 | -1,53 | 90,78 | 88,91 |
| Profit before tax, thousand rubles. | -63126,00 | 70217,00 | 46,06 | 230,25 |
From the data in table. 2.2 it follows that other income does not constitute a significant share in the income structure: 8.03% in 2010, 8.73% in 2011, 6.09% in 2012. At the same time, the growth rate of other income in 2012, the revenue growth rate was lower: 105.31% versus 155.47%. From this follows the conclusion about the qualitative profit of the organization, i.e. it has a stable character.
2) Deviations of actual profit from its average value. The greater these deviations, the less stable the profit and the lower its quality.
Average profit before tax for 2010-2012. will be: (117037+53911+124128)/3 = 98359 thousand rubles.
Deviations from the average profit will be:
– in 2010: 117037-98359 = 18678 thousand rubles;
– in 2011: 53911-98359 = - 44448 thousand rubles;
In 2012: 124128-98359 = 25769 thousand rubles.
In percentage terms, deviations from the average profit before tax were:
In 2010: 18678/98359*100 = 18.99%;
In 2011: -44448/98359*100 = - 45.19%;
In 2012: 25769/98359*100 = 26.20%.
On average, deviations from the average profit are about 30%, which is not a high figure, therefore, according to this criterion, the profit should also be considered high-quality.
3) Cost structure of the organization. A significant share of “other expenses” indicates the “opacity” of the organization and the poor quality of its profits.
From the data in table. 2.2 it follows that the share of other expenses in the total expenses of the organization was 15.23% in 2010, 13.83% in 2011, 12.29% in 2012, i.e. there is a pronounced negative trend, while expenses from core activities have a correspondingly pronounced growth trend. Therefore, according to this criterion, profit should also be considered qualitative.
Economic efficiency The organization's activities are characterized by profitability indicators. In the process of financial analysis, as a rule, two groups of profitability indicators are used: profitability of core activities and return on assets (capital). Profitability indicators make it possible to evaluate the efficiency of resource use, the efficiency of advances of own and attracted resources, the efficiency of costs incurred, sales, etc.
In table 2.3 presents the main profitability indicators used in the practice of financial analysis, calculated according to the financial results report and balance sheet(Appendix B).
Table 2.3 - Analysis of profitability indicators of OJSC Elsib for 2010-2012.
| Indicators | 2010 | 2011 | 2012 | Changes | |
| 2011/ 2010 | 2012/ 2011 | ||||
| 18,99 | 11,89 | 13,83 | -7,1 | 1,94 | |
| 12,30 | 7,8 | 10,01 | -4,5 | 2,2 | |
| 0,65 | 0,66 | 0,72 | 0,01 | 0,06 | |
| 4,00 | 1,40 | 3,03 | -2,6 | 1,63 | |
| 12,23 | 2,60 | 9,02 | -9,63 | 6,42 |
From the data in table. 2.3 it follows that the organization’s activities are profitable, available resources are used efficiently. But in 2011, operating efficiency decreased compared to 2010, as evidenced by the negative dynamics of profitability indicators. In 2012, compared to 2011, profitability indicators increased, but compared to 2010, their value was smaller (Fig. 2.3).
Figure 2.3 – Dynamics of profitability indicators of OJSC Elsib
for 2010-2012
Therefore, in general, we can conclude that the efficiency of the organization has decreased.
The performance of an organization is also determined through business activities. The term “business activity” began to be used in domestic accounting and analytical literature relatively recently - in connection with the introduction of analysis methods widely known in various countries of the world.
“The business activity of a commercial organization is manifested in the dynamism of its development, the achievement of its goals, which is reflected in natural and cost indicators, in the effective use economic potential, expanding markets for their products,” says V.V. Bocharov.
In a broad sense, business activity means the entire range of efforts aimed at promoting a company in the product, labor, and capital markets.
In the context of analysis of financial and economic activities, this term is understood in a narrower sense - as current production and commercial activity enterprises; in this case, the phrase “business activity” is perhaps not a completely successful translation of the English term “ business activity", precisely characterizing the corresponding group of coefficients from the system of indicators, according to V.V. Kovalev and O.N. Volkova.
Some authors, for example, V.G. Kogdenko, the concept of business activity is associated with the quality of management based on the criterion of the speed of conversion of the organization’s assets into cash. L.V. also thinks so. Dontsova and N.A. Nikiforova: “Business activity in financial aspect manifests itself, first of all, in the speed of funds turnover. Analysis of business activity consists of studying the levels and dynamics of various financial ratios - turnover indicators.”
The above definitions of business activity are, in fact, summarized in the definition of business activity given by a group of authors (V.R. Bank, S.V. Bank, A.V. Taraskina): “Business activity is the performance of an enterprise relative to the amount of advanced resources or the amount of their consumption in the production process. Business activity is manifested in the dynamic development of an economic entity, its achievement of its goals, as well as the speed of turnover of funds.”
Drawing a general parallel among the opinions of various authors, it should be noted that there are similar approaches to the fact that business activity depends on the effective use of the organization’s material, labor and financial resources. Thus, business activity should reflect the efficiency of capital allocation in different types of assets. If a significant part of it is advanced into non-current assets, then it will take much more time to release it than when investing in current assets that have average term circulation up to one year. Consequently, organizations must control the optimal ratio of current and non-current assets so as not to freeze advanced financial resources for more long term than it was planned. This is one of the conditions for effective capital management of an organization, industry, and economy as a whole.
The analysis of business activity is presented by turnover ratios, turnover period indicators and consolidation ratios; When calculating turnover indicators, indicators of the value of assets and revenue (expenses) are compared, while the values of assets must be taken in the average annual assessment.
Turnover ratios = (2.1)
Turnover in days = (2.2)
Operating cycle time = Accounts receivable turnover (2.3)
Inventory turnover (in days)
Length of financial cycle = Length of operating cycle (2.4)
– Accounts payable turnover (in days).
For calculations, average values for the year will be required (Table 2.4).
Table 2.4 - Average values for calculating the business activity of Elsib OJSC for 2011-2012.
The calculation of business activity indicators using the above formulas is presented in table. 2.5.
Table 2.5 - Indicators of business activity of JSC Elsib for 2011-2012.
| Indicators | 2010 | 2011 | Changes |
| Current assets turnover ratio, turnover | 0,9 | 2,2 | 1,3 |
| Turnover period of current assets, days | -236 | ||
| Inventory turnover ratio, turnover | 1,5 | 2,3 | 0,8 |
| Inventory turnover period, days | -80 | ||
| Accounts receivable turnover ratio, turnover | 2,5 | 2,5 | 0,0 |
| Accounts receivable turnover period, days | -2 | ||
| Accounts payable turnover ratio, turnover | 1,6 | 1,8 | 0,3 |
| Accounts payable turnover period, days | -34 | ||
| Equity turnover ratio, turnover | 2,6 | 3,8 | 1,2 |
| Period of equity capital turnover, days | -44 | ||
| Permanent capital turnover ratio, turnover | 2,0 | 2,9 | 0,9 |
| Period of turnover of permanent capital, days | -54 | ||
| Operating cycle, days | -81 | ||
| Financial cycle, days | -48 |
From the data in table. 2.5 it follows that the organization’s business activity in 2012 increased significantly: the turnover period of current assets decreased from 397 to 161 days, the inventory turnover period decreased from 237 to 157 days. Collection of accounts receivable accelerated from 144 to 143 days. Settlements with creditors accelerated from 231 to 198 days. The turnover period of permanent capital decreased from 176 to 122 days. The operating cycle decreased from 381 to 300 days, the financial cycle - from 150 to 102 days.
Thus, the organization’s business activity can be considered effective.
Labor supply of goods and...
The purpose of the analysis is to establish the features of changes in property, financial resources and financial results of IP Brytkova N.V. To perform this, aggregated forms are used accounting statements created in IP Brytkova for management purposes - balance sheet and financial performance report (Appendices 1 and 2).
Aggregation can be carried out different ways, one of which is combining reporting for several periods in one document with the subsequent removal of empty lines.
We will evaluate the property of IP Brytkova N.V. This type of analysis will consist of the following sections: analysis of the dynamics and analysis of the structure of assets of IP Brytkova N.V.
First, let's analyze the dynamics of the assets of IP Brytkova N.V. This analysis is carried out on the basis of the asset balance sheet of the enterprise. The purpose of the analysis is to determine how the elements of the enterprise's assets have changed over the analyzed period in absolute and relative terms.
Results of assessing the dynamics of IP assets Brytkova N.V. are given in table 8.
Table 8 - Dynamics of assets of IP Brytkova N.V. for 2013-2015
|
Index |
2013, thousand rubles |
2014, thousand rubles |
2015, thousand rubles |
Change, thousand rub. |
Change abs., % |
|
I. Non-current assets |
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|
Intangible assets |
|||||
|
Fixed assets |
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|
Financial investments |
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|
Total for Section I |
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|
II. Current assets |
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|
Accounts receivable |
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|
Financial investments |
|||||
|
Cash |
|||||
|
Total for Section II |
|||||
The total change in the value of assets amounted to 1,536 thousand rubles. or 15.28%. The main items that determined the growth of assets were fixed assets (an increase of 971 thousand rubles) and accounts receivable (an increase of 326 thousand rubles). In general, changes in the balance sheet assets are positive, since the production assets of IP Brytkova N.V. are increasing.
Now let’s analyze the structure of the assets of IP Brytkova N.V.
This type of analysis answers the question of what weights asset items have in the overall total, and how these weights change in the analyzed period.
The results of assessing the asset structure are Table 9.
Table 9 - Structure of assets of IP Brytkova N.V. for 2013-2015, in percentage
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Index |
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I. Non-current assets |
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Intangible assets |
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Fixed assets |
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Long-term financial investments |
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Total for Section I |
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II. Current assets |
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Accounts receivable |
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Financial investments |
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Cash |
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Total for Section II |
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Assessing the asset structure, it can be noted that in general it remains quite stable throughout the analysis period.
The majority of all property is fixed assets (81.41% as of 2015). The second most important item is inventories (8.73% for 2015), and the third is accounts receivable (5.56% for 2015). In general, we can say that assets have a “heavy” structure.
This is due to the fact that the company owns the car service premises; in addition, the operation of the enterprise requires relatively expensive fixed assets (for example, a car lift)
For ease of assessment, we reflect changes in balance sheet assets in Fig. 8.
Figure 8. Change in assets of IP Brytkova N.V. for 2013-2015
The figure shows that there is a consistent increase in the value of assets, which is mainly due to changes in the value of fixed assets. Now let's analyze the sources of financing of the enterprise under study. As in the case of asset analysis, this type of analysis consists of an analysis of the dynamics and analysis of the structure of liabilities of IP Brytkova N.V.
Let us perform an analysis of the dynamics of the liabilities of IP Brytkova N.V. This analysis is carried out on the basis of the liabilities of the balance sheet of the enterprise. The purpose of the analysis is to determine how the elements of the enterprise's liabilities have changed over the analyzed period in absolute and relative terms. Results of assessing the dynamics of IP liabilities Brytkova N.V. are given in table 10.
Table 10 - Dynamics of liabilities of IP Brytkova N.V. for 2013-2015
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Index |
2013, thousand rubles |
2014, thousand rubles |
2015, thousand rubles |
Change, thousand rub. |
Change abs., % |
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III. Capital and reserves |
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Authorized capital |
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Additional capital (without revaluation) |
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Total for Section III |
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Borrowed funds |
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Total for Section IV |
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Borrowed funds |
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Accounts payable |
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Total for Section V |
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In the company's liabilities, there was an increase in the total amount of funding sources by 1,536 thousand rubles. or 15.28%. The value of own sources increased by 1,363 thousand rubles, long-term attracted sources decreased by 123 thousand rubles, short-term attracted sources increased by 296 thousand rubles.
These changes are positive, since the enterprise’s dependence on external sources of financing decreases and its ability to self-finance increases.
Now let’s analyze the structure of liabilities of IP Brytkova N.V. This type of analysis answers the question of what weights the liability items have in the overall total, and how these weights change in the analyzed period. Results of assessing the structure of liabilities - table 11.
Table 11 - Structure of liabilities of IP Brytkova N.V. for 2013-2015, in percentage
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Index |
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III. Capital and reserves |
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Authorized capital |
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Extra capital |
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Retained earnings (uncovered loss) |
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Total for Section III |
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IV. long term duties |
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Borrowed funds |
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Total for Section IV |
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V. Current liabilities |
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Borrowed funds |
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Accounts payable |
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Reserves upcoming expenses and payments |
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Total for Section V |
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There are noticeable positive changes in the structure of liabilities. The share of own sources by 2015 increased by 7.30% and amounted to 40.93%.
It may be noted that IP Brytkova N.V. the share of long-term loans is quite large. This is explained by the fact that the company attracted a long-term loan to purchase its premises, hoping to repay it from the proceeds from its activities. At the beginning of 2015, the company slightly increased borrowing to upgrade its car lift, which can now lift vehicles weighing more than 3.5 tons.
Changes in liabilities indicate a gradual decrease in the enterprise's dependence on external sources of financing.
Let us reflect changes in balance sheet liabilities in Fig. 9.
Figure 9. Change in liabilities of individual entrepreneur Brytkova N.V. for 2013-2015
The figure shows that there is an increase in the size of funding sources, which mainly consists of an increase in the size of long-term borrowed money and retained earnings.
In general, changes in funding sources can be called positive.
The first type of analysis of the financial condition of an enterprise is an analysis of the solvency of the enterprise (determining the liquidity of the balance sheet). This type of analysis is performed on the basis of the balance sheet of IP Brytkova N.V. for management purposes.
To perform this type of analysis, an assessment of payment inequalities is used. The analysis is performed in three stages:
- 1) First, all assets are grouped according to the speed of their possible conversion into monetary form (by liquidity);
- 2) Then all liabilities are grouped according to the period when they need to be repaid (according to urgency);
3) And then assets and liabilities that coincide in time are compared with each other.
Let's group assets by liquidity - table 12
Table 12 - Grouping of assets of IP Brytkova N.V. by liquidity in 2013-2015
The table shows that the greatest growth is shown by illiquid assets (the company's fixed assets increase). This negatively affects the liquidity of the balance sheet of IP Brytkova N.V.
Now let’s group liabilities by urgency - table 13.
Table 13 - Grouping of liabilities of IP Brytkova N.V. by urgency in 2013-2015
The table shows that permanent liabilities are growing the most. This has a positive effect on balance sheet liquidity.
And now we can determine the solvency of individual entrepreneur N.V. Brytkova by comparing the corresponding groups of assets and liabilities of the enterprise in pairs.
The comparison results are shown in Table 14.
Table 14 - Solvency of individual entrepreneur Brytkova N.V. on payment inequalities in 2013-2015
The table shows that for 2015, out of 4 inequalities, 1 inequality is not satisfied. This means that the solvency of the organization is average, while in the period under review there is an increase in the deficit of liquid assets. Therefore, the solvency of IP Brytkova N.V. and the prospects for its change can be described as negative.
Let us reflect changes in solvency based on payment inequalities in Fig. 10.
Figure 10. Solvency of IP Brytkova N.V. on payment inequalities in 2013-2015
The graph shows that most payment inequalities are fulfilled, but the dynamics of their change is negative.
Results of calculation of liquidity indicators - table 15.
Table 15 - Liquidity indicators of IP Brytkova N.V. in 2013-2015
Liquidity indicators generally exceed standards, which indicates excess liquidity of the enterprise's assets.
For clarity, we show these indicators in Fig. eleven.
Figure 11. Liquidity indicators of individual entrepreneur Brytkova N.V. in 2013-2015
The graph shows that, in general, liquidity indicators remain at the same level. Only the current liquidity ratio shows pronounced negative dynamics. In general, this indicates a gradual reduction in the liquidity of IP Brytkova N.V.
Now let's calculate financial stability indicators.
Financial stability is complex characteristics sources of financing for the enterprise.
Indicators of financial stability answer the question in what proportions different types of liabilities are included in the overall total and how they relate to the most important elements of the enterprise’s assets.
Table 16 shows financial stability coefficients.
Table 16 - Financial stability coefficients of individual entrepreneur Brytkova N.V. in 2013-2015
The table shows that, in general, there is a gradual improvement in the financial stability of IP Brytkova N.V., although for 2015 it still remains insufficient.
For example, the autonomy coefficient, which shows the share of equity capital in the composition of financing sources, increased by 0.07, the financial leverage ratio, which shows the amount of borrowed funds per equity capital, decreased.
Let us display these indicators of financial stability in Fig. 12.
Figure 12. Financial stability coefficients for individual entrepreneurs Brytkova N.V. in 2013-2015
The graph shows that most indicators of financial stability show positive dynamics, this indicates an improvement in the financial stability of IP Brytkova N.V.
Now let's analyze business activity. This type of analysis consists of two sections: analysis of turnover rates and analysis of turnover periods.
First, let's calculate the main turnover indicators. These indicators answer the question of how many rubles of revenue fall on one ruble of financial and property resources, thus they characterize the return on use of these resources.
Calculation results - table 17.
Table 17 - Turnover indicators of individual entrepreneur Brytkova N.V. in 2013-2015
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Index |
Meas., abs. |
Change rel., % |
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Return on assets ratio |
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Return ratio of fixed assets (capital productivity ratio) |
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Return ratio of current (current) assets |
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Return ratio of inventories and costs |
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Return on equity capital ratio |
The vast majority of turnover indicators have declined. This indicates that for every ruble of financial and property resources used by IP Brytkova N.V. began to receive less revenue. That is, there is a reduction in the return on the use of these resources. As noted earlier, the reason for such changes is a decrease in the turnover of the enterprise with a simultaneous increase in the amount of property used and financial sources enterprises.
For clarity, we display the main indicators in Fig. 13.
Figure 13. Turnover indicators of individual entrepreneur Brytkova N.V. in 2013-2015
The graph shows a noticeable reduction in the turnover of financial and property resources, which is explained by the faster growth of the value of these resources compared to the growth of revenue.
Now let’s calculate the turnover periods of financial and property resources. These indicators answer the question of how long it will take the company to generate revenue sufficient to fully recoup the resources used.
The results of calculating turnover periods are Table 18.
Table 18 - Turnover periods of individual entrepreneur Brytkova N.V. in 2013-2015
The table shows that there is a noticeable increase in turnover periods. This means that IP Brytkova N.V. It takes more and more time to generate revenue that will be sufficient to cover the financial and property resources used.
The following figure shows these indicators - Figure 14.
Figure14. Turnover periods of individual entrepreneur Brytkova N.V. in 2013-2015
The graph shows that there is an increase in the turnover periods of financial and property resources, which is a negative trend and indicates a decrease in the productivity of the enterprise.
As a result of the study of the financial and economic activities of IP Brytkova N.V. it is necessary to assess the profitability indicators of the enterprise. This group of indicators answers the question of how effectively an enterprise uses the financial and property resources that are at its disposal.
They are defined as the result of the ratio of different types of profits (from the financial results statement) to the amount of financial and property resources that generate them.
These profitability indicators complement the previously calculated relative performance indicators of the enterprise. The results of assessing profitability indicators are shown in Table 19.
Table 19 - Profitability indicators of IP Brytkova N.V. in 2013-2015, in percentage
The table shows that all profitability indicators show negative dynamics. This indicates a deterioration in the efficiency of use of financial and property resources and is a sign of a deterioration in the financial condition of the enterprise under study.
The main factor in the deterioration of profitability indicators is a decrease in trade turnover, which leads to a reduction in all types of profit of the enterprise and, consequently, to a reduction in all profitability indicators.
In addition, the reduction in profitability is affected by the growth of used assets and liabilities and high share expenses in the financial results of the enterprise.
For clarity, we show these indicators in Fig. 15.
Figure15. Profitability indicators of individual entrepreneur Brytkova N.V. in 2013-2015, in percentage
The graph clearly shows that there is a reduction in all types of profitability of the enterprise. Moreover, in the second half of the analyzed period there was an increase in indicators, which somewhat reduced the decline in the first half of the period.
Thus, we can summarize the analysis of the financial and economic activities of IP Brytkova N.V.: as a result of a decrease in revenue, growth of property, financial sources, and the number of employees of the organization, IP Brytkova N.V. There is a deterioration in financial and economic activity: labor productivity is declining, the efficiency of using fixed assets is deteriorating, solvency is decreasing, business activity and profitability are decreasing.
During further development thesis it is necessary to propose reasonable measures to eliminate the identified negative trends.