AGGRESSIVE POLICY OF FINANCING CURRENT ASSETS OF TRADE ENTERPRISES: DIAGNOSIS OF THREATS AND CONSEQUENCES
Keywords:
current assets, trade enterprise, current assets financing policy, solvencyAbstract
The article, based on the study of the main indicators of the formation and financing of current assets of trade enterprises in Ukraine, reveals the predominance of the practice of applying an aggressive approach to financing current assets, which is characterized by particularly negative manifestations in difficult economic periods.
It has been noted that this practice requires additional attention of the company’s management to certain parameters of current asset management, their careful monitoring and control.
An approach to comprehensive diagnostics of the state of aggressive current financing policy has been suggested based on the assessment of a combination of values of financial cycle duration, net working capital, profit (or loss) and overdue current liabilities. Diverse situations which are characterized by various degree of threats to a financial condition of the trade enterprise, their features and directions of administrative influence concerning minimization of negative consequences for a financial condition of an enterprise have been identified.
References
James K., Van Horn, John M. (2008) Osnovy` finansovogo menedzhmenta [Basics of financial management] 12th edition / trans. with English Pelyavsky O.L. Moskow: LLC «I.D. Williams» [in Russian]
Brigham E. F., Gapenski L. C. (1988) Financial Management: Theory and Practice. Fifth Ed. Chicago, N.Y. etc: Dryden Press [in English]
Brayley R., Myers S. (2008) Princzipy` korporativnikh finansov [Principles of corporate finance] / trans. with English N. Baryshnikova. Moscow: CJSC «Olymp-Business» [in Russian]
Blank I.O., Sytnyk G.V., Andriets V.S. (2018) Upravli`nnya fi`nansami pi`dpriyemstva [Enterprise financial management]. Kyiv: KNUTE [in Ukrainian]
Vlasova N.O. (eds) (2014) Upravli`nnya oborotnimi aktivami na pi`dpriyemstvakh rozdri`bnoyi torgi`vli`[ Management of current assets in retail trade enterprises]. Kharkiv: KSUFT [in Ukrainian]
Vlasova N.O. (eds) (2015) Efektivni`st` poli`tiki formuvannya oborotnikh aktivi`v pi`dpriyemstv rozdri`bnoyi torgi`vli`: monografi`ya [Effectiveness of the policy of formation of current assets of retail trade enterprises: monograph]. Kharkiv: KSUFT [in Ukrainian]
Mazaraki A.A. (eds) (1999) Ekonomi`ka torgovel`nogo pi`dpriyemstva: pi`druchnik dlya studenti`v vishhikh navchal`nikh zakladi`v [Economics of a commercial enterprise: the textbook for university students]. Kyiv: Khreshchatyk [in Ukrainian]
Poltorak A.S. (2014) Mekhani`zm formuvannya ta efektivnogo vikoristannya oborotnikh aktivi`v na pi`dpriyemstvakh APK Ukrayini [The mechanism of formation and effective use of current assets at the enterprises of agro-industrial complex of Ukraine] // Bulletin of ONU named after I.I. Mechnykova. Volume 19, №3/2. P.180-182.
Fursa T.P. (2014) Konczeptual`ni` zasadi upravli`nnya oborotnimi aktivami pi`dpriyemstva [Conceptual principles of management of current assets of the enterprise] // Bulletin of Odessa National University. Economics series. Volume 19, issue 1(2). P. 184-187.
Yermak S.O. (2011) Teoretiko-metodichnij i`nstrumentari`j formuvannya kombi`novanikh poli`tik upravli`nnya oborotnim kapi`talom [Theoretical and methodological tools for the formation of combined working capital management policies] // Industrial economics. № 2. P. 242–249.
Stratiychuk V.M. (2019) Suchasni` pi`dkhodi do oczi`nyuvannya rezul`tativnosti` strategi`yi upravli`nnya oborotnimi aktivami pi`dpriyemstva torgi`vli` [Modern approaches to evaluating the effectiveness of the strategy of management of current assets of the trade enterprise] // Problems of system approach in economy. № 5 (73). P. 123-132.
Sajt derzhavnoyi sluzhbi statistiki Ukrayini [Website of the State Statistics Service of Ukraine]. Available at: http://www.ukrstat.gov.ua/druk/publicat/kat_u/2019/zb/11/zb_dsg_2018.pdf. (date of application: 23.10.2020)
Downloads
Published
Issue
Section
License
This work is licensed under a Creative Commons Attribution-NoDerivatives 4.0 International License.
CC BY-ND
A work licensed in this way allows the following:
1. The freedom to use and perform the work: The licensee must be allowed to make any use, private or public, of the work.
2. The freedom to study the work and apply the information: The licensee must be allowed to examine the work and to use the knowledge gained from the work in any way. The license may not, for example, restrict "reverse engineering."
2. The freedom to redistribute copies: Copies may be sold, swapped or given away for free, in the same form as the original.
