Abstract
China's construction industry has continued to develop for decades, and the industry is extremely competitive, resulting in high debt ratios for construction companies. The high gearing ratio can bring huge financial risks to the enterprises and jeopardize the future development of the enterprises. To address this problem, this paper takes X construction company as the research object, analyzes the financial risk control status of the company, and Optimizes the financial risk evaluation system of X construction company based on the analysis results using the hierarchical analysis method to assess the financial risk of the company, and proposes corresponding control strategies in order to solve and improve the specific problems exposed in the financial risk control of X construction company, and provide a better solution to the financial risk control of X construction company. The purpose is to solve and improve the specific problems revealed in the financial risk control of X construction company, and to provide reference for the current financial risk control research of construction enterprises.
Highlights
The construction industry has developed rapidly since China's reform and opening up, but the high gearing ratio at the same time of development means that the financial risk of construction enterprises is relatively high, which may bring about insufficient cash flow and lead to a break in the enterprise's capital chain and the enterprise's inability to repay debts in time, leading to the possibility of bankruptcy
Financial risk control is directly related to the future profitability and development of the enterprise, the better the financial risk control, the more helpful to the development of the enterprise, on the contrary, it will bring harm to the enterprise, the degree of danger is positively related to the risk control [7,8]
According to the current financial risk situation of X construction company, combined with the actual situation of the company, in order to control the financial risk within an acceptable range, this paper proposes some control strategies to achieve the purpose of controlling the financial risk
Summary
The construction industry has developed rapidly since China's reform and opening up, but the high gearing ratio at the same time of development means that the financial risk of construction enterprises is relatively high, which may bring about insufficient cash flow and lead to a break in the enterprise's capital chain and the enterprise's inability to repay debts in time, leading to the possibility of bankruptcy. By studying the control strategies of the financial risk control problem of construction companies, with a view to providing reference for the financial risk control of similar construction companies, and by using the solutions of this financial risk control in the implementation and application in the production and operation of similar enterprises, we can prevent the possible harm brought to the enterprise by the financial risk, and at the same time reduce the unnecessary losses brought to the enterprise. When the expected output value is not completed to bring the company a certain amount of revenue, it may lead to a break in the capital chain and the debt due cannot be repaid, which will bring losses to the enterprise
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