Before we talk about that also includes factor maneuverability equity , you must clearly understand the notion.
So, this is primarily an indicator that indicates which part of the capital is in circulation, thereby forming an idea of how much of the funds may be involved in other investments, and any capitalized.This maneuverability factor should be high enough, it will give the opportunity to use its own funds to specific needs (procurement of raw materials, components, etc.), Is not on the verge of bankruptcy.
If this figure is reduced, it indicates that there is a slowdown in the company collection of receivables, as well as stricter conditions for granting trade credit from side contractors and suppliers.Conversely, if it increases, it means the possibility to repay the company's current liabilities increased, the creditworthiness of the organization grows.
believed that maneuverability ratio indicates the ratio of working capital, which is at the disposal of the company to other sources of funding.Not surprisingly, this figure is not constant and unchanging.It can vary, depending on the industry sector of the company and its structure.
like the best is when factor maneuverability functioning capital dynamics, albeit slightly, but increases.This growth rate indicates only that the organization is functioning normally.The fact is that this figure could rise only when increased own working capital and additional sources of financing are reduced.There is a direct relationship that the sudden increase that can automatically cause a reduction in other indicators.For example, the ratio of financial autonomy will grow sharply and lead to the organization depending on the lenders.
I must say that from a financial point of view, this figure should be as high as possible, then it is better for the enterprise, as thus it indicates that the organization is free to maneuver in their financial activities and are not afraid to be dependent onthem.The best can be considered when maneuverability ratio is 0.5, although in this case, some experts are inclined to even 0.3.
Speaking of the formula by which we can calculate this indicator, it should include an accurate profit and loss of a particular company, so it's best to do this, armed with figures from the accounting department or special program.
In order to find out what will be best for the company factor maneuverability, need to compare it to a specific enterprise with other averages in the industry.
Do not forget that there are cases where this figure may be negative.Then we can safely say that this is a company that is not able to ensure the formation of expenses and reserves, and therefore the company does not have enough capital to create not only non-negotiable but also current assets.In this case we are dealing with insolvent companies.
Thus, we see that a detailed study of the company and its precise calculation of the coefficient of maneuverability allows us to understand how promising is the activity of the company and whether it leads to a complete bankruptcy and catastrophic reduction investment.
