scholarly journals Problems with the application of conventional financial ratios in corporate risk measurement

2013 ◽  
Vol 7 (4-5) ◽  
pp. 5-12
Author(s):  
Veronika Fenyves
Keyword(s):  
Financial Crisis ◽  
Financial Analysis ◽  
Risk Measurement ◽  
Financial Ratios ◽  
Visible Sign ◽  
Future Situation ◽  
Internal Stakeholders ◽  
Corporate Risk ◽  
A Company ◽  
Economic And Financial Crisis

One of the enterprises’ biggest fears is a potential bankruptcy situation. This is the reason there are a lot of people who try to anticipate it. To be aware of the actual and expected future situation of a company is in the interest of all those who are related. This topic has come to the fore after the economic and financial crisis of 2008. Companies, their creditors and internal stakeholders should be aware of the liquidity and solvency situation of a given company, because its deterioration can cause serious problems for all of them. During the financial analysis of companies, the problem of liquidity indicators showing bad signals can often be experienced, although there is no visible sign of difficulty in their operation. In other cases, the situation is just the opposite, i.e. liquidity ratios are adequate, but still, the business faces payment issues. How could it happen? The purpose of this study is to present indicators which can measure more accurately and reliably the actual liquidity position of a company.

The Role of the External Audit in Assessing Continuity of Companies under the Financial Crisis: An Applied Study in the Iraqi Banks Listed in the Iraq Stock Exchange for the Period 2016-2019

2021 ◽  
Vol 39 (11) ◽  
Author(s):  
Sallama Ibrahim Ali ◽  
Hakeem Hammood Flayyih
Keyword(s):  
Financial Crisis ◽  
Financial Analysis ◽  
Stock Exchange ◽  
Early Stage ◽  
International Standards ◽  
Financial Ratios ◽  
External Audit ◽  
Energy Company ◽  
Wide Range

In the first decade of the third millennium, shareholding companies faced several crises, with four major crises affecting financial markets, beginning with the collapses of a group of large companies following the Enron Energy company and similar companies in various countries, followed by the financial crisis and the collapse of global oil prices, which quickly ended until the sta As a result, the purpose of this study is to shed light on the role of external audit in assessing bank continuity, as Iraqi banks are among the first institutions and companies to move toward the application of international standards as well as being committed to accounting principles and assumptions, and they face a wide range of risks, the most dangerous of which is financial instability. Furthermore, the Kida model has been adopted in assessing the stability of banks and their ability to meet their obligations and perform their duties through a set of financial ratios that distinguish successful banks from those whose ability is suspect and vulnerable to financial failure, as well as trying to identify the nature of their activities at an early stage. However, using financial ratios, Kida's model was applied to a sample of three Iraqi banks, and the research concluded that the external auditor should use financial analysis models to know and evaluate the banks' continuity in terms of anticipating financial collapse.

Financial Management for the Successful Company Value

2021 ◽  
pp. 126-152
Author(s):  
Jakub Horak ◽  
Veronika Machova ◽  
Jaromir Vrbka
Keyword(s):  
Financial Crisis ◽  
Rural Areas ◽  
Financial Management ◽  
Financial Analysis ◽  
Literary Research ◽  
Company Value ◽  
Business Entities ◽  
Valuation Tools ◽  
The Relationship ◽  
A Company

This chapter deals with the issue of valuation of business entities. Based on literary research, which forms the basis of the chapter, two practical examples are given. The aim of the first example is to evaluate the financial situation of the concrete company for the period of 2007-2019 using valuation tools (financial analysis, creditworthiness and bankruptcy models, EVA). The purpose is to capture the course of an expansion disrupted by the great financial crisis that erupted in 2008 and to monitor the gradual return of corporate activities. The results of the analysis show that the financial crisis initially had a significant impact on the company but was nevertheless averted. The aim of the second example is, with the help of neural networks, to determine the relationship between the value generators of a company and EVA equity of small and medium-sized enterprises operating in rural areas of the Czech Republic in the period of 2013-2017. It is found that successful companies are distinguished from unsuccessful ones by the degree of human capital involvement.

scholarly journals The problem of accounting methods in connection to company valuation

2013 ◽  
Vol 61 (4) ◽  
pp. 867-872
Author(s):  
Michaela Beranová
Keyword(s):  
Financial Reporting ◽  
Financial Analysis ◽  
Financial Ratios ◽  
Strategic Analysis ◽  
Reporting Standards ◽  
Financial Reporting Standards ◽  
Starting Point ◽  
Company Valuation ◽  
Financial Plan ◽  
A Company

Valuation of a company is not only a calculation but it represents complex set of processes which are mutually interconnected and which are more or less important in the process of company valuation in dependence of the value category inquired. One of these processes is the financial analysis which objective is not only to prove, subsequently the strategic analysis, going concern of a company, but its outcomes are the starting-point of financial plan preparation that is needed in order to apply income-based methods of company valuation. It is generally accepted that results of financial ratios differ in implications of applied accounting methods. The objective of this paper is to frame an influence of accounting methods on the income-based value of a company while the stress is put on the methods of inventory measurement in the context of both, in context of the Czech accounting law as well as of the International Financial Reporting Standards.

scholarly journals The Ratio Analysis of Financial Balance and Bankruptcy Risk of the Silesian Companies in Time of the Global Financial Crisis

Equilibrium ◽  
2012 ◽  
Vol 7 (3) ◽  
pp. 111-126 ◽  
Author(s):  
Joanna Błach ◽  
Monika Wieczorek-Kosmala
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Financial Analysis ◽  
Financial Ratios ◽  
Bankruptcy Risk ◽  
Financial Situation ◽  
Aggregated Data ◽  
Business Entities ◽  
Financial Balance ◽  
The Impact

The financial crisis undoubtedly exerted much pressure on the companies operating inPoland. Thus, it is important to undertake researches that reveal the paths and strength of financial crisis transmission with regard to the business entities. This paper presents partial results of the research dedicated to the analysis of the impact of financial crisis on the financial situation of companies operating in the Silesian Voivodship. It analyzes and discusses the general changes of the two sets of financial ratios that inform about the general financial condition of the business: the financial balance and the level of bankruptcy risk. Scientific aim: The paper aims at analyzing the changes of the financial situation and bankruptcy risk of a population of Silesian companies with regard to the improvement or deterioration. In particular, it aims at reflecting the differences visible with the application of aggregated data characterizing the population of Silesian companies as compared to the population of all companies operating inPoland. Methodology: The study is based the application of a part of authors’ self-developed method – the CFS Watch, which consists of five analytical modules. In the study, two modules are applied: the GPA Module (General Performance Assessment) with regard to financial balance and the MDA Module (Multidiscriminant Analysis) with regard to the bankruptcy risk. Grounded on the theory of financial analysis and its application for corporate finance purposes, the modules are based on the selected financial ratios that are a subject for further comparison regarding their height and dynamics of changes. The analytical modules are applied for aggregated data provided by the Polish Central Statistical Office.

ANALISIS PREDIKSI POTENSI KEBANGKRUTAN PADA PT BANK MUAMALAT INDONESIA Tbk PERIODE 2012-2016 DENGAN MENGGUNAKAN METODE ALTMAN MODIFIKASI

2017 ◽  
Vol 5 (2) ◽  
pp. 287-324
Author(s):  
Dewi Laela Hilyatin
Keyword(s):  
Financial Performance ◽  
Financial Structure ◽  
Financial Statements ◽  
Financial Ratios ◽  
Z Score ◽  
Altman Analysis ◽  
Gray Area ◽  
Modification Method ◽  
A Company

Abstract Bankruptcy is a very essential issue that every company should be aware of. Bankruptcy of a company can be minimized by advanced prediction; such as analyzing the financial statements. This study discusses the financial performance of PT Bank Muamalat Indonesia Tbk, which indicates that there is a degression in some number of financial ratios, the closing of offices and firing of employees in 2012-2016, causing he fact that BMI must pay attention and improve its financial performance and anticipate the existence of a bankruptcy in the company. Based on Altman analysis modification for financial performance of PT Bank Muamalat Indonesia Tbk in 2012-2016, it found Z-Score value of 0,825, 0,659, 1,243, 0,982 and 0,892. Based on Z-Score criteria, PT Bank Muamalat Indonesia Tbk is predicted to experience problems in management and financial structure and also in potentially bankruptcy due to Z-Score value <1,1 while the highest Z-Score value is in 2014, which shows the value of Z-Score>1,1 and <2,6, which means the company is in the gray area, meaning the company’s category is not said to be bankrupt and also not healthy. Keywords: Bankruptcy, Altman Modification Method

scholarly journals Economic and financial crisis based on Troika’s intervention and potentially avoidable hospitalizations: an ecological study in Portugal

2021 ◽  
Vol 21 (1) ◽  
Author(s):  
Cristina Loureiro da Silva ◽  
João Victor Rocha ◽  
Rui Santana
Keyword(s):  
Financial Crisis ◽  
Health Management ◽  
Hypertensive Heart Disease ◽  
Foreign Assistance ◽  
Chronic Obstructive ◽  
Socioeconomic Variables ◽  
Avoidable Hospitalizations ◽  
Use Of Resources ◽  
Tract Infections ◽  
Economic And Financial Crisis

Abstract Background Hospitalisations for Ambulatory Care Sensitive Conditions (ACSC) cause harm to users and to health systems, as these events are potentially avoidable. In 2009, Portugal was hit by an economic and financial crisis and in 2011 it resorted to foreign assistance (“Memorandum of Understanding” (2011–2014)). The aim of this study was to analyse the association between the Troika intervention and hospitalisations for ACSC. Methods We analysed inpatient data of all public NHS hospitals of mainland Portugal from 2007 to 2016, and identified hospitalisations for ACSC (pneumonia, chronic obstructive pulmonary disease, hearth failure, hypertensive heart disease, urinary tract infections, diabetes), according to the AHRQ methodology. Rates of hospitalisations for ACSC, the rate of enrollment in the employment center and average monthly earnings were compared among the pre-crisis, crisis and post-crisis periods to see if there were differences. A Spearman’s correlation between socioeconomic variables and hospitalisations was performed. Results Among 8,160,762 admissions, 892,759 (10.94%) were classified as ACSC hospitalizations, for which 40% corresponded to pneumonia. The rates of total hospitalisations and hospitalisations for ACSC increased between 2007 and 2016, with the central and northern regions of the country presenting the highest rates. No correlations between socioeconomic variables and hospitalisation rates were found. Conclusions During the period of economic and financial crisis based on Troika’s intervention, there was an increase in potentially preventable hospitalisations in Portugal, with disparities between the municipalities. The high use of resources from ACSC hospitalisations and the consequences of the measures taken during the crisis are factors that health management must take into account.

Global financial crisis, risk analysis and risk measurement

2009 ◽  
Vol 33 (11) ◽  
pp. 1949-1952 ◽  
Author(s):  
Stijn Claessens ◽  
Aslı Demirgüç-Kunt ◽  
Fariborz Moshirian
Keyword(s):  
Financial Crisis ◽  
Risk Analysis ◽  
Global Financial Crisis ◽  
Risk Measurement

RASIO FUNDAMENTAL TERHADAP PERTUMBUHAN LABA: VARIABEL MODERASI UKURAN PERUSAHAAN (Fundamental ratio on income growth: Variables of company size moderation)

2021 ◽  
Vol 5 (1) ◽  
pp. 261
Author(s):  
Andri Gunawan Putra As'ari ◽  
Tri Kartika Pertiwi
Keyword(s):  
Financial Analysis ◽  
Stock Exchange ◽  
Research Result ◽  
Sampling Technique ◽  
Financial Statements ◽  
Company Size ◽  
Analysis Technique ◽  
Solvency Ratio ◽  
A Company ◽  
Profit Growth

To find out the performance of a company it is necessary to have a financial analysis, where in analyzing the financial statements will get a view of the good and bad financial performance. For this reason, this study aims to analyze the effect of the Liquidity Ratio, Solvency Ratio, Profitability Ratio, and Activity Ratio on profit growth with company size as a moderating variable. The population in this study was all trade retail companies that listed in Indonesia Stock Exchange in the period 2015-2018. The research samples was determined by using purposive sampling technique, so that obtained 21 trade retail companies that quality as the sample. The analysis technique used is moderation regression analysis. Based on the research result showed that Solvability, Profitability and Activity ratios has an effect on profit growth and company size is a moderation variabel. Liquidity Ratio has no effect on profit growth and company size not a moderating variable between Liquidity on profit growth.

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