There are different ways to manage the financial stability of an enterprise. The choice of a specific method is determined by the parameters of the economic activity and the material condition of a particular company.
The following factors influence the stability of the financial condition of the organization:
profitability;
revenue dynamics;
efficiency of distribution of finance as sources of asset financing.
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The executives and managers who british student data package run the company can influence these parameters using the following methods:
Increasing the amount of finance while maintaining the efficiency of its use . This will cause an increase in absolute indicators of financial stability, while the level of relative parameters will remain the same.
Increasing the efficiency of using the organization's funds without increasing their volumes. With this approach, relative indicators of financial stability decrease, while absolute ones remain unchanged.
An increase in the volume of the enterprise's monetary resources with a parallel improvement in the efficiency of their use . In this case, the absolute parameters grow, and the relative ones decrease.
Increase in the efficiency of using the organization's finances with a decrease in their volumes . This allows to reduce absolute and increase relative indicators of financial stability.
Reducing the volume of the company's material resources while maintaining the efficiency of their use . This method leads to an increase in relative parameters and a decrease in absolute indicators of financial stability.
In practice, these methods are implemented through the adoption of management decisions based on the results of the analysis of changes in the financial condition of the company and the assessment of its indicators.
Methods of managing the financial stability of a company
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Example of calculating the financial stability of a company
In order to develop, the organization needs to buy a new production line, the price of which is 24,000 rubles. For this, three financing methods can be used:
Take a 12-month loan from a bank and use it to buy a line.
Buy using a 24-month lease.
Find co-investors and issue promissory notes to them with closing in 36 months.
The choice of any of these methods will affect the organization's balance sheet in a certain way.
When using credit funds, the growth of non-current assets will be 24,000 rubles and, at the same time, current liabilities will increase by the same amount.
When leasing, non-current assets will remain the same, as will short-term liabilities, provided that the acquired line will be on the balance sheet of the lessor until the end of the contract. The company's profit will decrease each quarter by the amount of the lease payment, since it is included in operating expenses, due to which the equity capital will decrease.
If the leasing agreement is drawn up in such a way that the production line is immediately transferred to the balance sheet of its recipient, then the non-current assets and current liabilities of the enterprise will simultaneously increase by these 24,000 rubles.
When acquiring a line by issuing bills of exchange to co-investors, the amount of non-current assets in the balance sheet will increase by 24,000 rubles, and at the same time long-term liabilities will increase by the same amount.
Thus, based on the influence of different options, it can be understood that the option of acquiring a production line by issuing bills of exchange or leasing, in which it will remain on the balance sheet of the lessor, will be more correct from the point of view of maintaining the financial stability of the enterprise.
The execution of a lease with the transfer of the line to the company's balance sheet or the option of using credit funds will lead to a decline in the financial stability of the organization.
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