Financial Stability Of Companies Research Articles

Problems and prospects of methodological features of accounting and audit of import operations

In the context of globalization and integration of world markets, import operations occupy an important place in the activities of enterprises, forming a significant part of their economic processes. Effective management of these operations requires accurate and timely accounting and high-quality auditing, which becomes especially relevant in modern conditions. The study of methodological features of accounting and auditing of import operations is a relevant and timely area that helps improve the quality of financial reporting and management decisions. The purpose of the study is to analyze the problems and prospects of methodological features of accounting and audit of import operations, as well as to develop recommendations for their improvement. The study examined the main methodological approaches, existing problems and challenges, and proposed solutions aimed at increasing the efficiency and reliability of accounting and auditing in a global economy. The improvement of methodological approaches to the accounting and auditing of import operations will improve the accuracy and reliability of financial reporting, reduce the risks of non-compliance with regulatory requirements, as well as improve management decision-making and the overall financial stability of companies. The development and implementation of effective accounting and auditing methods that comply with international standards and best practices will minimize financial risks and increase the competitiveness of enterprises in the global market. A study of the problems and prospects of methodological features of accounting and auditing of import operations has revealed a number of key issues that require attention and solutions. The main challenges are the complexity and diversity of regulatory requirements, currency fluctuations, the diversity of imported goods and services, difficulties in assessing and recognizing imported goods, and the lack of qualified specialists.

Financial stability of companies and its relationship with corporate sustainability

Subject. This article explores the mutual influence of financial stability and sustainable development at the micro level. Objectives. The article aims to reveal the relationship between corporate sustainability and financial stability, and formalize the system of interrelated factors affecting these categories. Methods. For the study, we used general scientific methods, as well as the methods of logical, retrospective, comparative, and structural analyses. Results. Based on the analysis of the trends in the formation of multipolarity in the modern world, the article identifies the barriers created on the way to sustainable business development. It also represents a formalized system of interrelated factors of the categories Financial Stability and Corporate Sustainability, which includes groups of various factors. Conclusions and Relevance. The formalized system of factors of the categories under study clearly reflects the relationship between the financial stability of companies and the level of their corporate sustainability. The proposed system of factors provides an understanding of the groups of mutually influencing factors and will help in future research on this basis to form a system of indicators aimed at assessing the level of mutual influence of the categories Financial Stability and Corporate Sustainability. The study contributes to the development of theoretical provisions and methodologies for assessing corporate sustainability. The results can be used in the development of internal standards of organizations in terms of assessing the level of corporate sustainability.

The Impact of Competitive Relations on the Issuers’ Dividend Policy

Purpose: The aim of the research is to analyse the impact of indicators of market position and financial stability of companies as determinants of competitiveness on dividend policy. Methodology: The research employed the methods of correlation analysis, multivariate regression, and statistical analysis. Findings: As a result of the study, two indicators characterizing dividend policy and eleven indicators were identified as determinants of companies’ competitiveness. It was established which determinants of competitiveness have a close connection and significant impact on the dividend policy. It was found that for Lenovo, P/B ratio (–0.69) has the greatest impact, Dividend Yield, variables not included in the model (0.62), Annual revenue (1.18), Net assets by year (0.93) — on Annual dividend payments. For ASUS, Total debt by year (0.88) has the greatest impact on Dividend Yield, Total liabilities (0.36) and Total debt (0.63) - on Annual dividend payments. Originality: The results indicate that ASUS actively uses debt policies in the competition for investors, while Lenovo follows a more conservative approach. The results may be useful for investors when choosing companies to invest in. Research prospects may be aimed at investigating the relationship between dividend policy and global macroeconomic phenomena.

Impact of COVID-19 Pandemic on Construction Professionals’ Skills: A Case Study of Chile

The construction industry faced several challenges due to the COVID-19 pandemic, affecting different aspects of construction projects, such as the financial stability of companies and the mental well-being of professionals. However, there is limited knowledge about how these challenges impacted the skills required by professionals in construction. Therefore, the aim of this study is to analyze changes in skills required by construction professionals in response to the COVID-19 pandemic. To do so, we qualitatively analyzed interviews obtained from construction professionals in Chile who worked through the pandemic to study how skills required by construction professionals before the pandemic were impacted during, and after the pandemic. The results indicate that before the pandemic, the most valued skills were related to teamwork, decision-making, planning, and leadership. During the development of the COVID-19 pandemic, skills such as effective communication, computer skills, planning, and stress management were prominent. Regarding the post-pandemic period, interviewees emphasized that construction professionals required mainly adaptability to change, stress management, and planning skills. Our study contributes by identifying changes in the skills required by construction professionals, emphasizing a shift towards skills like digital communication, adaptability, and stress management. Additionally, our study emphasizes planning as the most relevant skill for construction professionals to deal with a highly disruptive event such as the pandemic in construction projects. The study contributed to theorizing the consequences of the pandemic faced by the construction sector in the context of skills required by construction professionals. In practicality, construction managers may use our results to develop strategies to adapt to the post-pandemic context and be prepared for future disruptive events. Ultimately, this will help make the construction industry a more resilient sector.

The Impact of ESG Indicators on the Financial Stability of Companies

This study examines the relationship between financial performance and environmental, social and governance (ESG) indicators of companies, and examines differences between EU, CIS and other European countries. The main goal of this study is to assess the financial sustainability of a company based on its ESG indicators during economic shocks and analyze the degree of impact. To complete the following study, we used panel regression and several models were constructed. In all of them the dependent variable is one of the selected financial indicator and the explanatory variable is a combination of different ESG indicators (environmental, social and governance respectively). The financial data and ESG data from database in our study were based on financial and ESG statements published by companies. Sample on which the study is based contains companies from Europe region (EU, CIS and other European countries) and covers the time period between 2019 and 2022. We expect to find the confirmation to the fact that ESG Combined Score can positively affect financial performance of companies. We are also looking forward to identify the components of ESG Score that affect financial sustainability in the most significant way. Also in the end of our study we will make a set of ESG initiatives that can positively affect companies and make them more resilient to economic shocks.The research was supported by RSF (project No. 23-18-00756)

ВЛИЯНИЕ УКЛОНЕНИЯ ОТ УПЛАТЫ НАЛОГОВ НА АКЦИОНЕРНУЮ СТОИМОСТЬ КОМПАНИЙ

The article examines the impact of an aggressive tax planning strategy on the financial stability of companies. The results of the study indicate that tax evasion can lead to significant negative consequences, including reduced transparency of financial statements and potential adverse effects on the cost of capital. It can also negatively affect the capitalization of companies due to agency conflicts, as additional opportunities appear for managers and controlling shareholders to extract rents at the expense of minority shareholders.

CORPORATE FINANCIAL DISTRESS PREDICTION USING STATISTICAL EXTREME VALUE-BASED MODELING AND MACHINE LEARNING

The industrial sector plays a leading role in an economy such that the financial stability of companies from this sector be a big concern. Two financial ratios, i.e., the Interest Coverage Ratio (ICR) and the Return on Assets (ROA), are used to determine the corporate financial distress conditions. This work considers two schemes for determining financial distress. First, a company is categorized as distressed if either ICR<1 or ROA<0. The second scheme is for when both ICR<1 and ROA<0 are met. The proportion of distressed and non-distressed companies is imbalanced. Our work views the distressed companies (minority class) as a rare event, causing the proportion to be extremely small, such that the Extreme Value Theory can be employed. The so-called Generalized Extreme Value regression (GEVR), developed from GEV distribution, predicts the distressed labels. The GEVR's performance is compared using machine learning with and without feature selection. The feature selection in GEVR uses backward elimination. The model for prediction employs a drift or windowing concept, i.e., using past-period predictors to predict the current response. The empirical results found that the GEVR, with and without the feature selection, provides the best prediction for financial distress.

Financial stability ratios of the world's leading publicly traded oil and gas corporations as an indicator of the investment attractiveness of domestic vertically integrated oil and gas companies

Subject. The article considers the main financial stability ratios of the twenty five leading publicly traded oil and gas companies within 2006 through 2018. Objectives. The study aims to determine the current level of values of the main indicators of financial stability of the leading publicly traded oil and gas companies, as well as identify the key trends in their changes within the studied period, and establish factors that caused those changes. Methods. For the study, I used the methods of comparative, financial and economic analyses, summarizing financial reporting data. Results. The article reveals certain deterioration of the key indicators of financial stability of the leading publicly traded oil and gas companies within the studied period. The article finds that the global financial crisis as a whole did not have a significant negative impact. A decrease in the book value of assets as a result of revaluation, as well as the implementation of mergers and acquisitions with the attraction of an impressive corporate-wide debt capital can have a serious negative impact on the financial stability of companies in the industry. The trend towards improvement of financial stability indicators was outlined in the stock market sector of the industry after the industry crisis. Conclusions and Relevance. The leading oil and gas companies are able to pay off their own debt obligations in times of crisis. The findings can help evaluate, forecast and develop measures to improve the financial stability of publicly traded oil and gas companies.

Financial stability ratios of the world's leading publicly traded oil and gas corporations as an indicator of the investment attractiveness of domestic vertically integrated oil and gas companies

Subject. The article considers the main financial stability ratios of twenty five leading publicly traded oil and gas companies from 2006 through 2018. Objectives. The aim of the study is to determine the current level of values of the main indicators of financial stability of the leading publicly traded oil and gas companies, to identify the key trends in their change within the studied period, and to establish those factors that led to this transformation. Methods. The study is based on methods of comparative and financial-economic analysis, generalization of materials of consolidated income statements. Results. The paper reveals deterioration of key indicators of leading publicly traded oil and gas companies’ financial stability within the studied period. I found that the global financial crisis, as a whole, did not have a significant negative impact. A decrease in the book value of assets as a result of revaluation, as well as implemented mergers and acquisitions with the attraction of an impressive corporate-wide debt capital can have a serious negative impact on the financial stability of companies in the industry. The trend towards improvement of financial stability indicators was outlined in the stock market sector of the industry after the industry crisis. Conclusions. In times of crisis, leading oil and gas companies were able to pay off their own debt obligations.

Review of Publications in the Journal of Scientific and Practical Journal «Finance and Business» for 2020 and 2021

The article considers the review of publications in the journal “Finance and Business” for 2020 and 2021. The main attention is paid to the developments of methodological nature aimed at building models for financial management, at improving the methods of doing business in modern economic conditions, at the evolutionary development of economic theory, changing the traditional view of the role of financial management and the prospects of economic development. When studying the dynamics of economic processes, their modeling and forecasting, statistical and econometric approaches can be widely used, the correct interpretation of which in business is of special interest, because it evaluates financial stability of companies and probability of bankruptcy, which is reflected in the review of articles under consideration. In the same respect itмитьбю.,юбьтимвыф ти мс8098765кенгь is of interest to model the probability of corporate default based on forecasted dynamics of financial statements indicators. At the macro level the financial resources of the country largely depend on the formation of tax revenues. Possibilities of their forecasting increase the assessment of the potential of tax revenues and, accordingly, clarify the real possibilities of growth of financial resources in the country as a whole and in its individual regions. Therefore, the review considered this direction of research in relation to the problems of personal income tax collection with the use of ARIMA-models. Modern management of the financial sphere implies the improvement of the information base. This largely applies to the development of accounting and auditing, the adaptation of IFRS in Russia and requires the development of new approaches to the organization of accounting. Digitalization in the economy changes the technology of information base formation, which is reflected in several articles published in the journal “Finance and Business”. The articles under consideration contain a detailed list of literary sources, which is of significant interest to readers wishing to delve deeper into the problem under study.

The specifics of using a variable approach to accounting for a company's expenses for an IPO in modern conditions

A variant approach to the possibility of providing for the reflection of the costs of an organization (company) on an IPO (from the English - Initial Public Offering) through the formation of deferred costs is substantiated. An alternative possibility is proposed for using this approach by joint-stock companies to reflect the costs of an IPO in a linear way, taking into account the life cycle of the company. Such an approach can help improve investment policy, increase the level of capitalization and financial stability of companies against the backdrop of falling incomes and non-decreasing costs. The implementation of the approach will require amendments to the Accounting Regulation "Organization's Expenses" (PBU 10/99) in terms of adjusting the methods for estimating the cost, which, according to the authors, is not only justified, but also necessary for domestic companies whose shares are listed on the Moscow Exchange.

Analysis of bankruptcy factors of the Russian developers

In 2019, there was a transition to project financing of housing construction in Russia. As a result, by the end of 2021, more than 73% of the area of apartments under construction are sold using escrow accounts. However, about 21% of the apartments being sold are being built by developers who are in the process of bankruptcy. Regional primary housing markets are, firstly, segmented, and secondly, in some regions – mainly in the regions of the Far North, Eastern Siberia and the Far East – there is a high concentration of developers, which can lead to additional negative consequences in terms of the development of housing markets of these regions in case of bankruptcy of regional companies. In this situation, it is important to form additional tools for assessing the risks of bankruptcy of companies in order to be able to prevent negative consequences in a timely manner in the future. Despite the fact that a large number of scientific publications of both foreign and domestic researchers have been devoted to the issues of modeling the risks of bankruptcy of firms, only a small number of authors have addressed the issues of assessing the financial stability of Russian developers. The novelty of this study consists in constructing a model for predicting the probability of bankruptcy of developers in Russia (that is, a risk management system) based on an original database, which, in addition to financial coefficients from companies' reports, also includes industry-specific indicators. The aim of the work is to build a quantitative model of bankruptcy risks of developers (in the short and medium term) based on easily observable characteristics of their activities. The results obtained show that the probability of bankruptcy is high for companies with low values of return on assets, asset turnover ratio and current liquidity ratio. Additional factors that reduce the likelihood of bankruptcy are the fact of the developer's group membership, experience in housing construction. Also, the financial stability of companies in the industry as a whole is affected by macroeconomic shocks.

НЕЙРОСЕТЕВЫЕ МОДЕЛИ ОЦЕНКИ ВЛИЯНИЯ ЦИФРОВЫХ ТЕХНОЛОГИЙ НА ФИНАНСОВУЮ УСТОЙЧИВОСТЬ КОМПАНИИ

The article is devoted to the development of a methodology for assessing the impact of digital technologies on the financial performance of a company. The digitalization of business processes of companies and organizations today is one of the main trends that ensure innovative development and competitiveness. Due to the diversity of companies in size, spheres of activity, operating conditions, the means and methods of digitalization can vary significantly. The introduction of certain technologies does not necessarily guarantee the success and financial stability of a company. Therefore, assessing the impact of digital technologies in making management decisions related to the implementation of innovations is an urgent task. The complexity of such an assessment is associated with the presence of a large number of factors affecting the economic performance of companies, while many factors cannot be quantified and can only be assessed in the form of expert qualitative assessments. The study was carried out on a statistical sample containing information on the level of business digitalization and the number of bankruptcies in the constituent entities of the Russian Federation. The indicator of the number of bankruptcies is used in this work as a resultant indicator reflecting the financial stability of companies in the region as a whole. The most widespread and massive digital technologies were selected as influencing factors: broadband Internet, ERP systems, RFID tags, cloud services, electronic sales systems, as well as digitalization indices of the constituent entities of the Federation. In the course of the research, to determine the impact of digital technologies on the financial stability of the company, a software model of artificial neural networks (ANN) was developed in the R Studio environment. In the work, the type of neural network is selected and all the necessary settings are calculated. The experiments carried out allowed us to optimize the network parameters in order to ensure the best accuracy. The final results of the study confirmed the impact of digital technologies on the sustainability of companies.

Financial instruments of State support for small and medium-sized businesses in Russia during the coronavirus pandemic

Subject. The article examines financial instruments of State support for small and medium-sized enterprises (SMEs) in Russia, in the context of the crisis and pandemic. Objectives. The purposes are to unveil major financial and economic mechanisms and instruments of State support for SMEs, analyze the results of State policy, aimed at financial assistance to SMEs, assess measures to support SMEs during the crisis and pandemic, and define the main directions of State policy development in relation to SMEs in the coming years. Methods. The study employs methods of logical, statistical, qualitative and qualitative analysis, and graphical methods for presenting the results of information analysis. Results. I identify economic problems, faced by SMEs in the most affected spheres of activity, reveal that the vulnerable position of SMEs rests on insufficient financial stability of companies, which is associated with negative changes in the economy that disrupted the economic linkages among entities, and a decrease in lending from the banking sector. Conclusions. In Russia, there are serious problems in SME development. To solve them, it is necessary to maintain anti-crisis measures and continue targeted support to SMEs in priority sectors of the economy. It is crucial to develop comprehensive financial support for SMEs, consolidate all support tools provided by credit institutions and participants of the National Guarantee System, expand the access of SMEs to participation in procurement of the largest customers, and digitalize the procurement process on the basis of a digital platform.

Investigation of the Influence of Internal Control System Factors on the Financial Stability of Companies (Review)

Annotation. The quality of the internal control system can have a significant impact on decision-making by users of financial information and on the negative economic consequences of the organization's economic activities (bankruptcy, fictitious audit reports, etc.). The author suggests that these consequences are typical for Russian organizations due to their poor study of the factors that affect the system of internal control of organizations. The study reviewed 30 foreign (China, USA and Europe) publications indexed in Scopus and Web of Science on the problem of the influence of external and internal factors on the internal control system of organizations. Based on the results of the analysis of the literature, external and internal factors have been identified that affect the internal control system, which are characteristic of Russian organizations. In addition, the prospects for studying these factors for the internal control system of Russian organizations are outlined.

ІНСТРУМЕНТИ ВДОСКОНАЛЕННЯ УПРАВЛІННЯФІНАНСОВОЮ ДІЯЛЬНІСТЮ: РЕАЛІЇ ТА ПЕРСПЕКТИВИ

The relevance of the study is that the crisis in the financial and real sectors of the economy leads to financial instability of business. This issue is especially acute for insurance companies, which attract significant financial resources on a long-term basis or funds from risky types of insurance. The crisis related to the COVID-19 pandemic has led to problems in the Ukrainian insurance services market, which requires the introduction of new management tools for insurance companies. Under such conditions, there is a need to find and implement ways to improve management efficiency, which will be aimed at achieving financial stability, increasing profitability and eliminating crisis manifestations in financial activities. The object of the study is the financial activity of the insurance company to improve the tools of business management. It is noted that the insurance services market is the second in terms of capitalization among other non-banking financial markets. An analysis of the situation in the insurance market for the previous period, which shows that the number of insurance companies continues to decline, which requires a more detailed study of the impact of business management tools. It is noted that the NBU has been a regulator of insurance companies for more than a year in terms of solvency requirements, which is positive in the development of this business, as more decisive action has been taken to apply enforcement measures for non-compliance with Ukrainian legislation. It is proposed to introduce a set of tools to improve the management of the insurance company: the development of an effective procedure for adjusting the financial condition, tools to improve management and government regulation to create a strategy for the development of the insurance market. The regulator’s implementation of financial performance and the adoption of relevant laws will help determine the development strategy and business model, which will form capital adequacy, provide the necessary level of liquidity and asset quality, which will help financial stability of companies, restore consumer confidence in the insurance market.

Methodological Aspects Concerning Evaluation of the Financial Stability of Companies in the Crisis Economy Conditions

The financial stability of a company is one of the most important criteria for assessing the situation of enterprises both for the current period and for subsequent periods of functioning. Of course, every enterprise wants to have business liquidity, otherwise the basis of entrepreneurship collapses; however, the purpose of doing business is to make a profit. An enterprise can make good profits, but at the same time have large liabilities, that is, debts. In this case, it is difficult to call the company financially stable. The onset of the economic crisis in the Russian Federation only prompts the conduct of such studies. Firstly, because it is necessary to understand how the situation in the country's economy as a whole affects a single enterprise, and secondly, what the prerequisites for this influence can be noticed in advance and how to try to prevent them. The relevance of this study lies in the fact that today in Russia there are a number of difficulties with assessing the status of organizations and their adequate comparison with reality. There are many different methods for assessing the financial condition and, in particular, the financial stability of a company. However, when choosing one of them, it is necessary to consider them in order to identify the shortcomings of their application to certain market conditions. Identification of these disadvantages of different theories will allow us to competently and reliably analyse the financial condition of various companies. It is also worth noting that this topic is relevant not only for the companies themselves. The presence of positive dynamics of financial stability indicators as an integral part of the financial condition of the enterprise is one of the most important bases of investment attractiveness. Therefore, not only a company itself is interested in such studies in the inside, but also other market entities from the outside.

Features of selection of foreign securities for investment activities

Introduction. Selecting stocks to invest in is an extremely complex and responsible process. The investment process is the purchase of financial instruments both for long-term ownership and for a stable return. The purpose of the article is to develop practical recommendations and establish criteria for selecting securities for the investment portfolio, in particular for investors operating in the foreign stock market. Results. The main criteria by which investors should select shares in their own investment portfolio are identified: the presence of a trend; financial stability of companies; liquidity of shares; historical trends; correct distribution of capital. The presence of the trend is demonstrated in the work with the involvement of Bollinger Bands. This indicator is based on one of the basic indicators of technical analysis, namely the average current price for a specific period of time. To determine financial stability, one of the criteria for selecting shares in the S&P500 index, which is conducted quarterly by the S&P Global Inc. committee, was chosen. The liquidity of shares, the main indicator of which is the ability to quickly buy or sell a security with a minimum difference in price, depends on the volume of trades. In financial markets, including the stock mar-ket, seasonal trends are also important. One of the main rules in the formation of the investment portfolio is diversification, i.e. the distribution of capital among several low-correlated instruments. This makes it possible to align the yield curve of the portfolio, when during the drawdown of one asset another shows growth and vice versa. Conclusions. This list of factors for the selection of shares for the formation of its own investment portfolio is not complete. Of course, for more detailed acquaintance and analysis of stocks it is necessary to use deeper analysis, paying at-tention to tendencies inside the sector, company news, fundamental indicators, price, belonging to the index, country of origin of the company, etc. However, for the initial stage of the investment portfolio formation, these five criteria are suffi-cient. Key words: shares, investment portfolio, investment, criteria for selection of shares.

Анализ финансовой устойчивости компаний на основе моделей прогнозирования банкротства

Th is article is devoted to the study of the fi nancial stability of companies based on a number bankruptcy forecasting models. Th e authors analyzed fi nancial statements of 22 Russian and foreign retail companies that fi led for bankruptcy in the last fi ve years using the following bankruptcy models. Th e article provides a comparative analysis of bankruptcy models in order to identify the model that most accurately predicts the onset of bankruptcy.

The impact of the publication of non-financial statements on the financial performance of companies with the identification of intersectoral features

Investor expectations, rather than fundamentals, are increasingly influencing the value of a company. At a time when non-financial assets are becoming an important component of determining the value of the company, the disclosure of non-financial statements as a source of more extensive and meaningful information than financial statements, is becoming an increasingly popular topic of discussion of the scientific and business communities. Non-financial reporting includes types of external reporting provided by organizations to their stakeholders and covering those aspects of the organizations that go beyond the historical framework of financial performance. The information contained in non-financial reports can help investors form an opinion about the intellectual, financial, natural, human and social capital of the company and make a decision about investing. In the developed world, the publication of non-financial statements has become a common norm, while in Russia only a small proportion of companies still issue this type of reporting. The study of publishing non-financial reports dedicated to both theoretical and empirical literature, most empirical studies showed a positive effect of issue of non-financial reporting on the financial stability of companies. However, these studies do not focus on the impact of the publication of non-financial statements on the financial performance of companies in Russia. The purpose of this article is to study the impact of the publication of non-financial statements on the financial performance of Russian companies with the identification of intersectoral features. As a result of this study, it will be possible to understand how the disclosure of non-financial information affects the financial performance of Russian companies. From a practical point of view, this can help managers of companies in various industries to realize the importance or, conversely, the absence of the need to publish non-financial statements as a factor that can increase the credibility of the company in the eyes of investors and positively affect the financial results.