Assessing the Impact of Receivables on the Enterprise Value

Abstract

Purpose: An enterprise is considered a business unit in the valuation process. It is an integral property complex consisting of such elements that can be valued more or less independently of each other. Among these elements, it is customary to distinguish between those that can be quantified, such as land, real estate, equipment, liquid assets, receivables, and those that cannot be formalised, such as image, business reputation, technical competence, and quality of management. As a result, the total enterprise value can be defined as the sum of the values of its elements that can and cannot be comprehended. A significant indicator characterising the financial position of an enterprise is the state of settlements with debtors. Design / Methodology / Approach: The theoretical and methodological basis of our research is the scientific provisions of the modern theory of accounting and management, the works of domestic and foreign scientists on the basics of accounting, analysis and asset management. To solve the research tasks set in the work, specific methods were used, in particular, the statistical method, methods of regression analysis. Findings: Too much receivables is a negative phenomenon in the economy of any state. A significant amount of receivables, which takes place in relations between Ukrainian enterprises, undoubtedly leads to a crisis of non-payments. In turn, the non-payment crisis leads to a shortage of cash by enterprises that could be invested in their economic activities, and thus hinder the development of entrepreneurial activity in the country as a whole. The issues of the optimal amount of receivables in an enterprise are quite important and relevant for the activities of any enterprise, especially in the current conditions of the functioning of the economy. Originality / Value: It is determined an interdependence of the amount of receivables and its management. It is substantiated that timely and appropriate measures taken to settle the optimal amount of receivables lead to the financial recovery of all activities of the enterprise and ensure its financial security. It is investigated that the issues of the optimal amount of receivables at the enterprise are very important and relevant for the activities of any enterprise. Practical Meaning: An economic and mathematical model of calculation the optimal ratio of receivables is proposed, which will help in the management of receivables at the enterprise and increase the efficiency of its activities. Further Research: Development of receivables management models that will help to establish a real assessment of the value of the enterprise and increase the efficiency of the financial aspect of its activities.