Indicators profitability depend largely on timely diagnosis of economic insolvency of the organization.And the profitability of production are the starting point for its financial recovery, reorganization or timely liquidation.
mechanism diagnosis is based on the implementation of the following steps:
1) assessment of businesses and organizations to identify unsatisfactory balance sheet structure;
2) identification based estimates obtained from the obligation of the state to such organizations:
a) If it is determined that the insolvency of the organization is not directly related to the obligations of the state, this fact is the basis for the decision about the change of leadership of the organization, the priority of its privatization or addressthe Commercial Court to initiate bankruptcy proceedings;
b) if it is established that the organization is related to the insolvency of these obligations, it does not give grounds to apply to the organization's management and the organization of the above measures of responsibility;
3) the determination of the profitability (commercial enterprises, enterprises providing services, manufacturing plant).
As part of these activities is paramount objective assessment of enterprises and profitability of the enterprise, which fully determine possibilities for the evaluation of the diagnosed enterprises.
importance of the practical relevance of assessing the financial condition makes certain demands on its accuracy and objectivity and, as a consequence, the procedure for its implementation.
To assess the organization uses the corresponding instruction adopted by decree of the Ministry of Finance and Ministry of Economy.
basis for recognition of the company insolvent, is to have a situation in which the profitability of the enterprise and the value of estimated figures are lower than their normal values.The characteristic values of these factors are differentiated by major sectors of material production.
During practical testing revealed that the use of the instructions gives grounds to accept unsatisfactory financial condition of a very large number of industrial enterprises.However, a detailed study of the situation at these companies revealed a large number of reasonably well-functioning subjects receiving profits and properly pay wages staff, taxes - the state and with satisfactory profitability of the enterprise.In such a situation there is a need to improve the evaluation criteria specified in this manual.
As important as reflected in the instructions indicators, their was not enough for an objective, accurate assessment of economic insolvency.Solvency modern enterprise market can not be characterized only the current liquidity of its assets.
Firstly, the current liquidity is an intermediate characteristic of the state finance company.Through the implementation of effective (ineffective) deals its liquidity at some point may be restored and (lost) without much tangible impact on its solvency and financial reputation as a whole.
Secondly, the solvency of enterprises in modern, dynamic market environment depends not only on the liquidity of assets, but on the quality of daily cash flows.
The index of organizations own funds may not be used for an objective assessment.For example, at high business impact on their business finances unsatisfactory structure of the balance will be short on time and the minimum on the merits.
Financial, as we know, is the most complicated economic category, formed under the influence of three main components: solvency, financial stability and business activity.In view of the generally accepted multifactor phenomenon to be investigated, in our view, and it is required to form a system of performance indicators, avoiding very attractive practices to minimize their number.Diverse composition of the performance indicators will contribute to the accurate assessment of the financial condition of organizations and identify among them insolvent.
