Financial security of business is an indicator of financial management in crisis conditions

Abstract

This article posits that the financial security of a business is the primary indicator of effective financial management. The relationship between financial management and financial security is supported by a system and subsystem approach. It is established that financial security represents a pivotal financial and economic mechanism at both the macro level (the state) and the micro level (the enterprise). It is observed that financial management is conducted at all levels of the financial system, from the state of an individual enterprise. It has been demonstrated that the operation of any system in a state of crisis is contingent upon substantial financial and economic support and maintenance. The author posits that financial security is an effective and efficient measure for maintaining a relatively stable level of functioning for both the state and business in general. The concept of «financial security» is found to be highly multifaceted, with interpretations drawn from a range of perspectives, including organizational and statistical, functional and resource-based, and regulatory and legal. The primary objective of financial security for an enterprise can be defined as the implementation of a comprehensive organizational and management strategy, the assurance of operational stability in the context of prevailing business conditions, and the provision of a foundation for future growth and development, contingent upon the availability of financial and economic resources. The method of formation and implementation of financial security of the enterprise as an indicator of financial management in crisis business conditions is proposed and described, which includes the following stages 1) structural elements of financial security of an enterprise; 2) constituent elements of financial enterprise security; 3) organizational and managerial policy of financial enterprise security; 4) mechanism of implementation of financial enterprise security; 5) general coordination of the state of financial enterprise security; 6) «adaptation» of financial security of an enterprise to unstable and crisis business conditions. It is proposed to use economic-statistical and financial-economic indicators and international indices to assess the state of financial security of enterprises, in particular: the number of enterprises in the country; the volume of products (goods, services) sold by enterprises in the country; net profit (loss) of enterprises in the country; business activity index. The results show that financial security is an extremely important and necessary indicator for the assessment of the general state of business activity and the functioning of the country as a whole.