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Fin condition. Financial analysis of the enterprise on the balance sheet. Analysis of the financial condition of the enterprise

The main purpose of analyzing the financial condition organizations is to obtain an objective assessment of their solvency, financial stability, business and investment activity, and performance efficiency.
Purpose. The online calculator is designed for analysis of the financial condition of the enterprise.
Report structure:
  1. Structure of property and sources of its formation. Express assessment of the structure of sources of funds.
  2. Estimation of the value of the organization's net assets.
  3. Analysis of financial stability based on the amount of surplus (shortage) of own working capital. Calculation of financial stability ratios.
  4. Analysis of the ratio of assets by degree of liquidity and liabilities by maturity.
  5. Analysis of liquidity and solvency.
  6. Analysis of the effectiveness of the organization's activities.
  7. Analysis of the borrower's creditworthiness.
  8. Bankruptcy forecast using the Altman, Taffler and Lees model.

Instructions. Fill out the balance sheet table. The resulting analysis is saved in a MS Word file (see analysis example

We carry out horizontal and vertical balance analysis

We evaluate changes in the state of property and capital based on financial ratios

We make a short-term forecast of the state of solvency

We offer measures to improve financial condition

To make management decisions in a timely manner, you need complete, reliable, transparent information. Experts carry out an express assessment of the company’s financial condition based on the balance sheet.

Collecting information for express analysis

Let's look at how to analyze the financial condition of an enterprise and develop measures to improve it using the example of a regional company that produces confectionery products. The company's balance sheet is presented in table. 1, the results of calculations of financial ratios and liquidity ratios are in table. 2, 3.

Let's calculate the coefficient of loss (restoration) of solvency:

  • by the end of the year, the ratio of provision with own working capital is less than the normal value (≥ 0.1);
  • The current liquidity ratio is less than the normal value (2.0), but there is a tendency for the indicator to grow.

Let’s evaluate the possibility of restoring solvency in the next 6 months:

solvency recovery ratio = (1.14 + 6 / 12 × (1.14 - 1.1169)) / 2 = 0.58 (< 1,0).

Thus, the management of the enterprise should formulate rational management decisions in order to restore the solvency of the enterprise in the next 6 months.

Analyzing the results

Based on the results of the analysis, the following conclusions can be drawn:

1. Balance currency decreased by the end of the year by 12,414 thousand rubles. (-16.71%). This indicates that the assets and capital of the organization, i.e., its main activities, have decreased. Reasons for the decline:

  • reduction of equity capital (and above all, losses; see the balance sheet line “Capital and reserves”);
  • financing capital investments through short-term liabilities. The growth of non-current assets in the balance sheet under the section “Non-current assets” exceeds the total growth of equity capital and long-term liabilities under the section “Capital and reserves” and “Long-term liabilities”.

2. Magnitude non-current assets increased due to fixed assets (+362 thousand rubles, or +27.61%) and intangible assets. According to the results of the vertical analysis, it can be seen that the ratio of non-current assets to the balance sheet at the end of the year (5.77%) increased by 2.64% compared to the beginning of the year (3.13%). This is a positive result, indicating an increase in the production potential of the organization.

3. Magnitude current assets decreased for all items (except for VAT and short-term financial investments) and by 13,659 thousand rubles. (-18.98%).

Inventories decreased by 62.07%, which indicates a drop in production volumes, a reduction in inventories of raw materials and finished products.

4. Accounts receivable decreased by 10.82% (5,360 thousand rubles), however, the share of this balance sheet item during the reporting period increased by 4.72%.

For your information

The difference in the results of calculations of accounts receivable when conducting horizontal and vertical analysis arose due to the fact that accounts receivable did not decrease as significantly as the balance sheet total. Therefore, the increase in the share of receivables in the structure of property is a negative fact, which indicates a decrease in the mobility of property and a decrease in the efficiency of turnover.

5. According to the results of horizontal analysis, the accounts payable- by 20.43% (RUB 13,086 thousand). This indicates a reduction in urgent debts. The vertical analysis showed a decrease in the share of accounts payable by 3.85%.

On the one hand, this contributes to the growth of the organization’s liquidity, but on the other hand, the reduction in the amount of accounts payable is twice as large as the reduction in the amount of receivables, and this leads to a reduction in its own working capital and a decrease in the financial stability of the organization.

6. Magnitude equity decreased by 2193 thousand rubles. (-32.68%) due to a reduction in the volume of retained earnings, i.e. the financial results of the organization’s activities worsened, and the margin of financial stability decreased.

7. Reduction long-term liabilities talks about paying off debts to banks. But the absence of short-term loans and borrowings in the capital structure while simultaneously reducing accounts payable may indicate the low creditworthiness of the organization.

8. Dynamics financial ratios speaks of a decrease in the mobility of turnover and property in general; a decrease in production capabilities as a result of a reduction in inventories. A positive aspect is the increase in the provision of reserves with own funds.

9. Financial independence coefficients (autonomy, involvement, “leverage”) show the share of equity (borrowed) capital in total sources of funds.

For your information

The capital structure depends on the area of ​​activity of the organization. For industrial enterprises, the recommended share of equity capital in the total amount of sources of funds is at least 50%. An increase in the share of equity capital is assessed positively, as it reduces the level of financial risk and strengthens the financial stability of the organization.

In the organization under consideration, the value of the autonomy coefficient is low and continues to decline: at the beginning of the year, equity capital was only 9% of the total capital, at the end of the year - 7.3%.

10. Meaning equity capital agility ratio at the beginning of the year - 1.1788 (> 1) - indicates that turnover is ensured by long-term borrowed funds, which increases the risk of insolvency.

11. Absolute liquidity ratio shows what part of the current debt can be repaid in the time closest to the time of drawing up the balance sheet, which is one of the conditions for solvency. The normal value is 0.2-0.5.

The actual coefficient value (0.02) does not fall within the specified range. This means that if the cash balance is maintained at the reporting date level (due to the uniform receipt of payments from partners), the existing short-term debt cannot be repaid in 2-5 days.

12. Quick liquidity ratio reflects the organization’s predicted payment capabilities, subject to timely settlements with debtors. The value of this coefficient should be » 0.8.

In our problem, the quick liquidity ratio = 0.83. We can conclude that the organization is able to repay its debt obligations (non-urgent) subject to timely repayment of receivables 13. Current liquidity ratio (coverage) shows the extent to which current assets cover short-term liabilities. It characterizes the payment capabilities of the organization, subject to not only timely settlements with debtors and favorable sales of finished products, but also in the event of the sale, if necessary, of material working capital.

The level of the coverage ratio depends on the industry of production, the length of the production cycle, the structure of inventories and costs. Norm - 2.0< Ктл< 3,0, т. е. на каждый рубль краткосрочных обязательств приходится от двух до трех рублей ликвидных средств.

Failure to comply with this standard (in the balance sheet in question, Ktl = 1.14) indicates financial instability, varying degrees of liquidity of assets and the inability to quickly sell them in the event of simultaneous requests from several creditors.

Why has the financial condition of the enterprise deteriorated and is it possible to improve the situation?

The situation in the organization has worsened, most likely due to ineffective management decisions. This problem is caused by:

  • lack of strategy in the enterprise’s activities and focus on short-term results to the detriment of medium and long-term ones;
  • low qualifications and inexperience of managers;
  • low level of responsibility of enterprise managers to the owners for the consequences of decisions made, for the safety and effective use of the enterprise’s property, as well as for the financial and economic results of its activities.
  • increase the transparency of enterprise management;
  • optimize the activities of the enterprise in accordance with the results achieved and the benefits received from certain implemented projects;
  • clearly set tasks for staff and evaluate the results of their work in accordance with the goals and results of the projects;
  • increase the degree of cost control in the enterprise (the special nature of budgeting, planning, control and accounting);
  • gain experience and create your own knowledge base at the enterprise;
  • link the results of crisis management with the motivation of the managers and specialists involved in this process.

Anti-crisis management will also create favorable conditions for the functioning of the company and will contribute to its recovery from an unstable financial and economic situation. At the same time, it is necessary to monitor the appropriateness of the measures taken and evaluate their effectiveness.

Mechanism for increasing the anti-crisis stability of an enterprise:

The main role in the company's anti-crisis management system is given to internal mechanisms of financial stabilization.

As for our example, in order to overcome crisis phenomena, a company needs to try to find internal reserves to increase profitability and economic efficiency of its activities, namely:

  • review the pricing policy;
  • increase production volumes;
  • improve product quality;
  • sell products in more optimal terms;
  • accelerate the turnover of capital and current assets;
  • increase profitability and ensure break-even operation of the enterprise;
  • sell products on more profitable markets.

To reduce accounts receivable, you can take out a loan. But according to the results of the analysis, the company is 82.38% dependent on creditors. Therefore it is important:

  • carefully monitor the structure and dynamics of accounts payable;
  • conduct continuous monitoring of accounts payable;
  • promptly identify and eliminate negative trends;
  • constantly monitor the status of settlements with customers and suppliers for overdue debts.

Financial analysis: What is it?

The financial analysis- this is the study of the main indicators of the financial condition and financial results of the organization’s activities with the aim of making management, investment and other decisions by interested parties. Financial analysis is part of broader terms: analysis of the financial and economic activities of an enterprise and economic analysis.

In practice, financial analysis is carried out using MS Excel tables or special programs. During the analysis of financial and economic activities, both quantitative calculations of various indicators, ratios, coefficients, and their qualitative assessment and description, comparison with similar indicators of other enterprises are made. Financial analysis includes analysis of the organization's assets and liabilities, its solvency, liquidity, financial results and financial stability, analysis of asset turnover (business activity). Financial analysis allows us to identify such important aspects as the possible probability of bankruptcy. Financial analysis is an integral part of the activities of such specialists as auditors and appraisers. Financial analysis is actively used by banks that decide whether to issue loans to organizations, accountants in the preparation of explanatory notes for annual reports, and other specialists.

Fundamentals of Financial Analysis

Financial analysis is based on the calculation of special indicators, often in the form of coefficients characterizing one or another aspect of the financial and economic activities of an organization. Among the most popular financial ratios are the following:

1) Autonomy coefficient (ratio of equity capital to total capital (assets) of the enterprise), financial dependence coefficient (ratio of liabilities to assets).

2) Current ratio (ratio of current assets to short-term liabilities).

3) Quick liquidity ratio (the ratio of liquid assets, including cash, short-term financial investments, short-term receivables, to short-term liabilities).

4) Return on equity (the ratio of net profit to the enterprise’s equity)

5) Return on sales (the ratio of profit from sales (gross profit) to the company’s revenue), based on net profit (the ratio of net profit to revenue).

Financial analysis techniques

The following methods of financial analysis are usually used: vertical analysis (for example), horizontal analysis, predictive analysis based on trends, factor and other methods of analysis.

Among the legally (regulatory) approved approaches to financial analysis and methods, the following documents can be cited:

  • Order of the Federal Administration for Insolvency (Bankruptcy) dated August 12, 1994 N 31-r
  • Decree of the Government of the Russian Federation of June 25, 2003 N 367 “On approval of the Rules for conducting financial analysis by an arbitration manager”
  • Regulations of the Central Bank of Russia dated June 19, 2009 N 337-P "On the procedure and criteria for assessing the financial position of legal entities - founders (participants) of a credit organization"
  • Order of the FSFO of the Russian Federation dated January 23, 2001 N 16 “On approval of “Methodological guidelines for analyzing the financial condition of organizations”
  • Order of the Ministry of Economy of the Russian Federation dated October 1, 1997 N 118 “On approval of Methodological Recommendations for the reform of enterprises (organizations)”

It is important to note that financial analysis is not just the calculation of various indicators and ratios, comparison of their values ​​in statics and dynamics. The result of a qualitative analysis should be a well-founded conclusion, supported by calculations, about the financial position of the organization, which will become the basis for decision-making by management, investors and other interested parties (see example). It is this principle that formed the basis for the development of the “Your Financial Analyst” program, which not only prepares a full report based on the results of the analysis, but also does it without user participation, without requiring him to have knowledge of financial analysis - this greatly simplifies the life of accountants, auditors, and economists .

Sources of information for financial analysis

Very often, stakeholders do not have access to the organization’s internal data, so the organization’s public accounting reports serve as the main source of information for financial analysis. The main reporting forms - Balance Sheet and Profit and Loss Statement - make it possible to calculate all the main financial indicators and ratios. For a more in-depth analysis, you can use the organization’s cash flow and capital flow reports, which are compiled at the end of the financial year. An even more detailed analysis of individual aspects of the enterprise’s activities, for example, calculating the break-even point, requires initial data that lies outside the reporting framework (data from current accounting and production accounting).

For example, you can get financial analysis based on your Balance Sheet and Profit and Loss Statement for free online on our website (both for one period and for several quarters or years).

Altman Z-model (Altman Z-score)

Altman Z-model(Altman Z-score, Altman Z-Score) is a financial model (formula) developed by the American economist Edward Altman, designed to predict the probability of bankruptcy of an enterprise.

Enterprise Analysis

Under the expression " enterprise analysis" usually mean financial (financial-economic) analysis, or a broader concept, analysis of the economic activity of an enterprise (AHA). Financial analysis, analysis of economic activity refers to microeconomic analysis, i.e. analysis of enterprises as individual subjects of economic activity (as opposed to macroeconomic analysis, which involves the study of the economy as a whole).

Business Activity Analysis (ABA)

By using business activity analysis organizations, the general trends in the development of the enterprise are studied, the reasons for changes in operating results are investigated, plans for the development of the enterprise are developed and approved and management decisions are made, the implementation of approved plans and decisions made is monitored, reserves are identified in order to increase production efficiency, the results of the company’s activities are assessed, an economic strategy is developed its development.

Bankruptcy (Bankruptcy Analysis)

Bankruptcy, or insolvency- this is the inability of the debtor, recognized by the arbitration court, to fully satisfy the claims of creditors for monetary obligations and (or) to fulfill the obligation to make mandatory payments. The definition, basic concepts and procedures related to the bankruptcy of enterprises (legal entities) are contained in the Federal Law of October 26, 2002 N 127-FZ “On Insolvency (Bankruptcy)”.

Vertical reporting analysis

Vertical reporting analysis- technique of analysis of financial statements, in which the relationship of the selected indicator with other similar indicators within the same reporting period is studied.

Horizontal reporting analysis

Horizontal reporting analysis is a comparative analysis of financial data over a number of periods. This method is also known as trend analysis.

Financial analysis at an enterprise is needed for an objective assessment of the economic and financial condition in periods of past, present and projected future activity. To identify weak production areas, areas of problems, and identify strong factors that management can rely on, the main financial indicators are calculated.

An objective assessment of a company’s position in terms of economics and finances is based on financial ratios, which are a manifestation of the relationship between individual accounting data. The goal of financial analysis is to achieve the solution of a selected set of analytical problems, that is, a specific analysis of all primary sources of accounting, management and economic reporting.

Main goals of economic and financial analysis

If the analysis of the main financial indicators of an enterprise is considered as identifying the true state of affairs in the enterprise, then the results will provide answers to the following questions:

  • the company’s ability to invest funds in investing in new projects;
  • the current progress of affairs in relation to material and other assets and liabilities;
  • the state of loans and the company’s ability to repay them;
  • the existence of reserves to prevent bankruptcy;
  • identifying prospects for further financial activities;
  • assessment of the enterprise in terms of value for sale or re-equipment;
  • tracking the dynamic growth or decline of economic or financial activity;
  • identifying reasons that negatively affect business results and finding ways out of the situation;
  • consideration and comparison of income and expenses, identification of net and total profit from sales;
  • studying the dynamics of income for basic goods and in general from all sales;
  • determining the portion of income used to reimburse costs, taxes and interest;
  • studying the reasons for the deviation of the amount of balance sheet profit from the amount of sales income;
  • study of profitability and reserves to increase it;
  • determining the degree of compliance of the enterprise's own funds, assets, liabilities and the amount of borrowed capital.

Stakeholders

An analysis of the company's main financial indicators is carried out with the participation of various economic representatives of departments interested in obtaining the most reliable information about the affairs of the enterprise:

  • internal subjects include shareholders, managers, founders, audit or liquidation commissions;
  • external ones are represented by creditors, audit firms, investors and government officials.

Financial analysis capabilities

The initiators of the analysis of the enterprise’s work are not only its representatives, but also employees of other organizations interested in determining the actual creditworthiness and the possibility of investing in the development of new projects. For example, bank auditors are interested in the liquidity of a firm's assets or its current ability to pay its bills. Legal entities and individuals wishing to invest in the development fund of a given enterprise try to understand the degree of profitability and risks of the investment. An assessment of key financial indicators using a special technique predicts the bankruptcy of an institution or indicates its stable development.

Internal and external financial analysis

Financial analysis is part of the general economic analysis of the enterprise and, accordingly, part of a complete economic audit. The full analysis is divided into internal management and external financial audits. This division is due to two practically established systems in accounting - management and financial accounting. The division is recognized as conditional, since in practice external and internal analysis complement each other with information and are logically interconnected. There are two main differences between them:

  • by accessibility and breadth of the information field used;
  • degree of application of analytical methods and procedures.

An internal analysis of key financial indicators is carried out to obtain summarized information within the enterprise, determine the results of the last reporting period, identify free resources for reconstruction or re-equipment, etc. To obtain results, all available indicators are used, which are also applicable when researched by external analysts.

External financial analysis is performed by independent auditors, outside analysts who do not have access to the internal results and indicators of the company. External audit methods assume some limitation of the information field. Regardless of the type of audit, its methods and methods are always the same. What is common in external and internal analysis is the derivation, generalization and detailed study of financial ratios. These basic financial indicators of the enterprise’s activities provide answers to all questions regarding the work and prosperity of the institution.

Four main indicators of financial health

The main requirement for the break-even operation of an enterprise in market conditions is economic and other activities that ensure profitability and profitability. Economic activities are aimed at reimbursing expenses with income received, generating profit to satisfy the economic and social needs of team members and the material interests of the owner. There are many indicators to characterize activities, in particular these include gross income, turnover, profitability, profit, costs, taxes and other characteristics. For all types of enterprises, the main financial indicators of the organization’s activities are highlighted:

  • financial stability;
  • liquidity;
  • profitability;
  • business activity.

Financial stability indicator

This indicator characterizes the degree of correlation between the organization’s own funds and borrowed capital, in particular, how much borrowed funds account for 1 ruble of money invested in tangible assets. If such an indicator when calculated is obtained with a value of more than 0.7, then the financial position of the company is unstable, the activity of the enterprise to some extent depends on attracting external borrowed funds.

Liquidity characteristics

This parameter indicates the main financial indicators of the company and characterizes the sufficiency of the organization’s current assets to pay off its own short-term debts. It is calculated as the ratio of the value of current current assets to the value of current passive liabilities. The liquidity indicator indicates the possibility of converting the company's assets and values ​​into cash capital and shows the degree of mobility of such transformation. The liquidity of an enterprise is determined from two perspectives:

  • the length of time required to convert current assets into cash;
  • the ability to sell assets at a specified price.

To identify the true indicator of liquidity in an enterprise, the dynamics of the indicator are taken into account, which allows not only to determine the financial strength of the company or its insolvency, but also to identify the critical state of the organization’s finances. Sometimes the liquidity ratio is low due to the increased demand for the industry's products. Such an organization is completely liquid and has a high degree of solvency, since its capital consists of cash and short-term loans. The dynamics of the main financial indicators demonstrate that the situation looks worse if the organization has working capital only in the form of a large number of stored products in the form of current assets. To turn them into capital, a certain amount of time is required for implementation and the presence of a customer base.

The main financial indicators of the enterprise, which include liquidity, show the state of solvency. The company's current assets must be sufficient to repay current short-term loans. In the best situation, these values ​​are approximately at the same level. If an enterprise has much more working capital in value than short-term loans, then this indicates an ineffective investment of money by the enterprise in current assets. If the amount of working capital is lower than the cost of short-term loans, this indicates the imminent bankruptcy of the company.

As a special case, there is an indicator of quick current liquidity. It is expressed in the ability to pay off short-term liabilities using the liquid portion of assets, which is calculated as the difference between the entire working portion and short-term liabilities. International standards determine the optimal level of the coefficient in the range of 0.7-0.8. The presence of a sufficient number of liquid assets or net working capital within an enterprise attracts creditors and investors to invest money in the development of the enterprise.

Profitability indicator

The main financial indicators of an organization's effectiveness include the value of profitability, which determines the efficiency of using the funds of the company's owners and generally shows how profitable the operation of the enterprise is. The profitability value is the main criterion for determining the level of stock exchange quotes. To calculate the indicator, the amount of net profit is divided by the amount of average profit from the sale of the company's net assets for the selected period. The indicator reveals how much net profit each unit of goods sold brought.

The generated income ratio is used to compare the income of the desired enterprise in comparison with the same indicator of another company operating under a different taxation system. The calculation of the main financial indicators of this group provides for the ratio of profit received before taxes and due interest to the assets of the enterprise. As a result, information appears about how much profit each monetary unit invested in the company’s assets brought in for work.

Business activity indicator

Characterizes how much finance is obtained from the sale of each monetary unit of a certain type of asset and shows the turnover rate of the organization’s financial and material resources. For the calculation, the ratio of net profit for the selected period to the average cost of costs in material terms, money and short-term securities is taken.

There is no standard limit for this indicator, but the management forces of the company strive to accelerate turnover. The constant use of loans from outside in economic activity indicates insufficient financial receipts as a result of sales, which do not cover production costs. If the value of current assets on the organization's balance sheet is overstated, this results in the payment of additional taxes and interest on bank loans, which leads to loss of profit. A low number of active funds leads to delays in fulfilling production plans and the loss of profitable commercial projects.

For an objective, visual examination of economic activity indicators, special tables are compiled that show the main financial indicators. The table contains the main characteristics of work for all parameters of financial analysis:

  • inventory turnover ratio;
  • indicator of the company's receivables turnover over time;
  • value of capital productivity;
  • resource return indicator.

Inventory turnover ratio

Shows the ratio of revenue from the sale of goods to the amount in monetary terms of inventories at the enterprise. The value characterizes the speed of sale of material and commodity resources classified as a warehouse. An increase in the ratio indicates a strengthening of the organization’s financial position. The positive dynamics of the indicator is especially important in conditions of large accounts payable.

Accounts receivable turnover ratio

This ratio is not considered as the main financial indicators, but is an important characteristic. It shows the average time period in which the company expects payment to be received after the sale of goods. The calculation is based on the ratio of accounts receivable to average daily sales revenue. The average is obtained by dividing the total revenue for the year by 360 days.

The resulting value characterizes the contractual terms of work with customers. If the indicator is high, it means that the partner provides preferential working conditions, but this causes caution among subsequent investors and creditors. A small value of the indicator leads, in market conditions, to a revision of the contract with this partner. An option for obtaining the indicator is a relative calculation, which is taken as the ratio of sales revenue to the company's receivables. An increase in the ratio indicates an insignificant debt of debtors and high demand for products.

Capital productivity value

The main financial indicators of the enterprise are most fully complemented by the capital productivity indicator, which characterizes the rate of turnover of finance spent on the acquisition of fixed assets. The calculation takes into account the ratio of revenue from goods sold to the annual average cost of fixed assets. An increase in the indicator indicates a low cost of expenses in terms of fixed assets (machines, equipment, buildings) and a high volume of goods sold. A high value of capital productivity indicates insignificant production costs, and a low capital productivity indicates inefficient use of assets.

Resource efficiency ratio

For the most complete understanding of how the main financial indicators of an organization’s activities develop, there is an equally important resource return ratio. It shows the degree of efficiency of the enterprise’s use of all assets on the balance sheet, regardless of the method of acquisition and receipt, namely, how much revenue is received for each monetary unit of fixed and current assets. The indicator depends on the procedure for calculating depreciation adopted at the enterprise and reveals the degree of illiquid assets that are disposed of to increase the ratio.

Main financial indicators of LLC

Income source management ratios show the financial structure and characterize the protection of the interests of investors who have made long-term injections of assets into the development of the organization. They reflect the company's ability to repay long-term loans and credits:

  • share of loans in the total amount of financial sources;
  • ownership ratio;
  • capitalization ratio;
  • coverage ratio.

The main financial indicators are characterized by the volume of borrowed capital in the total mass of financial sources. The leverage ratio measures the specific amounts of assets purchased with borrowed money, which includes the firm's long-term and short-term financial liabilities.

The ownership ratio supplements the main financial indicators of the enterprise by characterizing the share of equity capital spent on the acquisition of assets and fixed assets. A guarantee of obtaining loans and investing investor money in a project for the development and re-equipment of an enterprise is the indicator of the share of own funds spent on assets in the amount of 60%. This level is an indicator of the stability of the organization and protects it from losses during a downturn in business activity.

The capitalization ratio determines the proportional relationship between borrowed funds from various sources. To determine the proportion between equity and borrowed finance, the inverse leverage ratio is used.

The interest coverage indicator or coverage indicator characterizes the protection of all types of creditors from non-payment of interest rates. This ratio is calculated as the ratio of the amount of profit before interest to the amount of money intended to pay off interest. The indicator shows how much money the company earned to pay borrowed interest during the selected period.

Market activity indicator

The main financial indicators of an organization in terms of market activity indicate the position of the enterprise in the securities market and allow managers to judge the attitude of creditors to the general activities of the company for the past period and in the future. The indicator is considered as the ratio of the initial book value of a share, the income received on it and the prevailing market price at a given time. If all other financial indicators are within the acceptable range, then the market activity indicator will also be normal if the market value of the stock is high.

In conclusion, it should be noted that financial analysis of the economic structure of an organization is important for all stakeholders, shareholders, short-term and long-term creditors, founders and management.

JSC "Arsenal" (EXAMPLE)

as of 01/01/2015

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

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

I. Indicators determining the state of working capital

Indicator name 01.01.2014 01.01.2015 change
basis report
1. Equity ratio 124.245 124.459 0.214
2. Ratio of provision of inventories with own funds 45.405 45.83 0.425
3. Maneuverability coefficient of own funds 456.429 456.562 0.133
4. Maneuverability factor 0.42 0.554 0.134
5. Mobility coefficient of all means 0.755 0.737 -0.018
6. Working capital mobility coefficient 0.168 0.205 0.037
7. Coefficient of provision of inventories and costs with their own sources of their formation 0.427 0.85 0.423

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

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

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

II. Indicators that determine the condition of fixed assets

Indicator name 01.01.2014 01.01.2015 change
basis report
8. Permanent asset index 0.571 0.438 -0.133
10. Industrial property ratio 0.702 0.671 -0.031
11. Long-term investment structure coefficient 0.041 0.032 -0.009

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

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

III. Indicators characterizing the capital structure

Indicator name 01.01.2014 01.01.2015 change
basis report
12. Autonomy (financial independence) coefficient 0.43 0.601 0.171
13. Debt capital concentration ratio 0.57 0.399 -0.171
14. Capitalization ratio (financial risk) 1.325 0.663 -0.662
15. Funding ratio 0.755 1.509 0.754
16. Ratio of mobile and immobilized assets 3.075 2.795 -0.28
17. Sustainable financing ratio 0.44 0.61 0.17

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

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

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

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

Indicator name 01.01.2014 01.01.2015 change
basis report
18. Long-term leverage ratio 0.023 0.014 -0.009
19. Share of long-term borrowed funds in the total amount of funds raised 0.017 0.021 0.004
20. Short-term debt ratio 0.983 0.979 -0.004
21. Accounts payable ratio 0.732 0.979 0.247
22. Coefficient of autonomy of sources of stock formation and costs 0.547 0.976 0.429
23. Bankruptcy forecast coefficient 0.195 0.346 0.151

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

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

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

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

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