Liability Ratio Research Articles

Analysis of the Causes of Baolong Real Estate Bond Default

The real estate industry, as a pillar industry of China's national economy, plays an important role in the development of the economy and society. However, in recent years, due to the impact of the epidemic and the tightening of industry regulation, credit risks in the real estate industry have begun to accelerate exposure. Since 2021, there have been frequent defaults on real estate company bonds, and the scale of defaults has rapidly climbed to the top of the industry. Therefore, in-depth analysis of the reasons behind the wave of defaults by real estate companies has become an important issue that urgently needs to be addressed. This article takes Baolong Real Estate as the research object to explore the causes of its bond default. Research has found that: The fundamental reason for the default of Baolong Real Estate bonds lies in the company's operational strategy mistakes and neglect of debt management. The company's heavy holdings in the third and fourth tier real estate markets, coupled with an increase in commercial real estate, have weakened the company's profitability and operational capabilities. In addition, the company's asset liability ratio is too high and there is a problem of mismatched debt maturity. After entering the centralized redemption period, under the dual pressure of tightened external financing environment and hindered internal sales collection, bond defaults ultimately occurred.

Assessing The Hospital Financial Viability Index in Private Healthcare Sector in Borsa Istanbul

The uninterrupted continuation of operations in healthcare enterprises significantly depends on the efficient and effective utilization of financial resources. Since the health sector demands intensive capital and qualified labor, continuous assessment of financial performance is essential for maintaining financial sustainability. This study aims to evaluate the financial performance of healthcare enterprises. The variables include the current ratio, the ratio of operating expenses to operating revenues, the ratio of liabilities to total assets, and the Hospital Financial Viability Index (HFVI). The analysis was performed for the 2019-2023 period with the consolidated financial statement data of Lokman Hekim, MLP, NASMED, and TAPDI enterprises traded in Borsa Istanbul. The findings indicate that the financial performances of health enterprises vary. NASMED and TAPDI enterprises do not experience financial difficulties, whereas Lokman Hekim and MLP enterprises experience financial difficulties during specific periods. It is recommended that health enterprises implement measures to improve their financial structures.

Subprime Crisis Shockwaves: Impacts On Capital Structure In Non-Financial Corporations

Based upon a dataset spanning about 2,780 non-financial firms in France over the period 2007- 2019, we explore the impact of the subprime crisis on their leverage ratio and capital structure, comparing the experience of the largest listed and unlisted non-financial corporates. Our results highlight that both listed and unlisted corporates tend to reduce their overall indebtedness ratios during the subprime crisis period and its aftermath, generalizing a significant corporate deleveraging for listed and unlisted firms especially during the post-crisis period. In addition, our findings show that listed corporates become more dependable on short- and medium-term credits than the long-term which may increase the exposure of these corporates to credit and liquidity shocks. While our outcomes reveal a clear preference to long-term debt for unlisted firms by expanding their debt maturities, relying on long-term credits and reducing their dependence on short- and medium-term debt which burden these corporates with short-term charges and payments that cannot afford during the crisis and post-crisis periods.

Research on the Evaluation of Competitiveness of Steel Industry Enterprises

The steel industry, as a fundamental industry in the organic development framework of China's economy, has been facing the long-standing problems of production exceeding consumption, high asset liability ratio, severe product homogenization competition, and high pollution and carbon emissions in the production process in recent times. At the same time, due to the impact of the sluggish demand caused by the COVID-19, the rapid rise in the cost of raw materials such as iron ore, and the gradual disappearance of a series of policy dividends such as supply side reform, the financial situation of steel enterprises is becoming more and more pessimistic. How to cope with the increasing financial risks and gain competitive advantages through strengthening financial competitiveness in the fierce market competition has become a major issue that China's steel enterprises urgently need to solve. This article selects steel industry enterprises as the research object for analysis. By reviewing relevant literature on enterprise competitiveness, the relevant concepts of enterprise competitiveness are extracted, and the research results and evaluation system are organized. Based on factor analysis, 16 targeted indicators are selected based on scale, efficiency, growth, operational capacity, debt paying capacity, and research and development capacity. An analysis model is constructed and analysis conclusions are drawn. In the analysis results, problems are identified regarding the poor competitiveness of steel industry enterprises. The following research results were obtained: 1) The overall competitiveness score of enterprises in the industry is not high, all less than 1. Among them, operational capability has the greatest impact on the competitiveness of steel industry enterprises, followed by scale, debt paying ability, efficiency, research and development ability, and growth. 2) The worst scoring indicators among the six enterprise competitiveness indicators are the scale indicator and the growth indicator. There is a significant gap in industry scale, with 12 companies scoring positive in the scale factor, accounting for 34.29% of the industry; The scale factor score of 23 enterprises is negative, with an industry proportion of 65.71%. In addition, there are growth indicators, with 12 companies in the industry having positive growth factor scores and 23 companies having negative growth factor scores, indicating a significant head effect on overall growth capacity.

Factors influencing the pricing of credit risk mitigation warrants in corporate bond financing

AbstractIn 2022, various Chinese regulatory authorities, including the China Securities Regulatory Commission (CSRC) and the State‐owned Assets Supervision and Administration Commission (SASAC), jointly issued documents and convened seminars at the Shanghai and Shenzhen Stock Exchanges to highlight the importance of credit protection tools, particularly credit risk mitigation warrants (CRMWs), to bolster corporate bond market financing. However, empirical research on the factors influencing CRMW prices in the Chinese market remains scarce. This study examines the factors affecting CRMW creation prices using a sample of CRMWs issued between 2018 and 2023 and analyzes the macroeconomic factors, characteristics of the underlying issuers, and related financial instruments. This study employs Shapley decomposition to evaluate the contribution of each variable. The findings reveal that, on the macroeconomic front, the year‐on‐year GDP growth rate from the previous quarter and the loan balance of financial institutions significantly and negatively impact CRMW prices. Regarding the underlying issuers, the issuer's credit rating and return on net assets significantly negatively affect CRMW prices, whereas the asset–liability ratio and issuer age have a significant positive impact. Additionally, related financial instruments such as bond interest rates and the risk mitigation certificate term positively contribute to the coverage of the underlying bond term and have a significant positive impact on CRMW prices.

Corporate Debt Dynamics: Sectoral Clustering Analysis Using NACE Classification in Slovakia

Research background: Many authors are currently exploring the impact of the industry on the financial structure of enterprises since there are statistically significant differences across various sectors, exposing the industry as a critical factor influencing corporate indebtedness. Clusters of sectors with homogeneous patterns of indebtedness and comparable levels of debt in various economic conditions may be determined, and, therefore, firms and their debt levels should be systematically examined and evaluated. Purpose of the article: The main aim of this paper is to evaluate the level of debt in the Slovak environment on a sample of 19,480 firms from various sectors and to identify the relationships among them to identify sectors with homogeneous patterns of indebtedness and, consequently, comprehend which sectors are the most stable and independent. Methods: Because NACE classification provides a framework for gathering and presenting statistical data based on many economic sectors, the number of input data was reduced based on cluster analysis. Using Ward's hierarchical clustering method using squared Euclidean distance, selected indebtedness ratios were used to define the sectors with comparable debt levels. To determine if there were statistically significant differences between the calculated debt ratios related to the economic sector, the Kruskal-Wallis test was performed. Subsequently, as the results indicated significant differences across various indebtedness ratios, a post hoc analysis was performed. Findings & Value added: A group of NACE activities in which enterprises are sufficiently comparable that it is appropriate to evaluate their debt levels using the chosen indebtedness ratios are considered to be in sectors C, F, G and H, which included to tertiary sector, while the sectors K, R and S may also be grouped in one cluster, while form the secondary sector. The key relevance of our findings is the benchmarking of selected sectors about indebtedness, which may be used to further examine their growth in each of the V4 nations, which is an essential area for the evolution of the European economy as a whole. Studies considering a relatively significant amount of capital structure determinants may be beneficial to owners and managers, regulators, and financial institutions since debt policy affects firm performance, value, and survival.

Monetary Policy Uncertainty and Earnings Management

ABSTRACT This paper analyses the relationship between monetary policy uncertainty and earnings management using financial data of Chinese listed companies from 2008 to 2019. The study finds a significant positive association between monetary policy uncertainty and earnings management. Additionally, the research shows monetary policy uncertainty enhances earnings management through corporate operating risk and financial constraints. Furthermore, the results indicate monetary policy uncertainty has a more significant impact on earnings management in non-state-owned enterprises compared to state-owned enterprises. Moreover, the positive impact of monetary policy uncertainty on earnings management is more significant in companies with a higher asset liability ratio. This study contributes to the understanding of the economic consequences of monetary policy uncertainty and expands the literature on the factors influencing corporate earnings management.

ANALISA KELAYAKAN RENCANA PEMBELANJAAN MODAL (CAPEX) PT UNITED TRACTORS TBK (UNTR) DALAM RANGKA MENGANTISIPASI PROYEKSI PERTUMBUHAN BISNIS PERUSAHAAN

The purpose of this study is to determine the performance of PT United Tractors Tbk through cash flow analysis that can be used as a decision-making tool by company and investors. Research approach to be used is quantitative descriptive, data used for analysis is secondary data, which is cash flow reports collected from the website of PT United Tractors Tbk. Data were analyzed using 8 cash flow ratios, namely: ration of operating cash flow, cash flow coverage ratio, interest coverage ratio of the cash, the cash coverage ratio of current liabilities, capital expenditure ratio, the ratio of total debt, the ration of net cash flow and free cash flow adequacy ratio. The results of the analysis indicate that the company's financial performance from 2017 to 2021 ratio generated tends to be deprived, where it seen from 5 ratios are on low average

Does the Cash Conversion Cycle Affect Firm Profitability? Some Empirical Evidence from Listed Firms in North Macedonia

Abstract This study aims to investigate the potential relationship between the cash conversion cycle (CCC) and firm profitability for the period from 2011 to 2019. To do this, a fixed effects panel regression model is applied to a sample of firms listed on the Macedonian Stock Exchange. Firm profitability is measured by the return on assets (ROA) ratio, while the liability ratio, firm size, current ratio, acid test and liquidity ratio are used as control variables. Our main finding is a decreasing and convex relationship between cash conversion cycle and profitability. In terms of working capital management policy, this implies that firms with a shorter cash conversion cycle perform better than others, since financial managers repay suppliers and reduce investments in working capital.

An Empirical Study on the Relationship between Capital Structure and Firm Performance: A Case Study of Listed Manufacturing Enterprises in Hebei Province

The financial data of Hebei Province's listed manufacturing enterprises from 2013 to 2022 is used in this paper to build a multiple linear regression model, and two-way fixed effect regression is used to examine the relationship between capital structure and corporate performance of these enterprises. The findings indicate that the retained earnings ratio and the gearing ratio of Hebei Province's listed manufacturing enterprises have a significant positive correlation with corporate performance, while the current liability ratio and the current liability ratio have a positive correlation. Based on this, this paper proposes two methods to maintain a reasonable asset-liability ratio and current liability ratio, optimize the capital structure of listed manufacturing enterprises in Hebei Province, and raise the enterprise's own capital as well as the ratio of retained earnings in profit distribution.

A proposed multidimensional model for predicting financial distress: an empirical study on Egyptian listed firms

Although there has been a growing interest by researchers worldwide over the past decades to identify the factors pertaining to corporate financial distress and to develop financial distress prediction models that serve as early warning signs to the various firm stakeholders, notably to date, studies that were conducted were context specific and cannot be objectively generalized to other countries and rendered mixed inconclusive results. Therefore, the main objective of this study is to thoroughly investigate the factors that affect corporate financial distress in Egypt and to develop a multidimensional financial distress prediction model. Using comprehensive data of EGX100 listed firms, the researcher examines the role played by financial ratios, market-based indicators, macroeconomic factors, and corporate governance mechanisms in modeling corporate financial distress. Empirical results indicate that after controlling for the COVID-19 effects, the most significant financial ratios in predicting corporate financial distress are the working capital to total assets ratio, earnings before interest and taxes to total assets ratio, and the sales to total assets ratio. Such ratios are negatively related to the likelihood of corporate financial distress. However, the market value of equity to total liabilities ratio, and GDP growth rate have a positive impact on the likelihood of financial distress. However, the retained earnings to total assets ratio, the corporate governance mechanisms, the firm market capitalization, the interest rate, and the consumer price index are insignificant in predicting corporate financial distress in the Egyptian context. The resulting model demonstrates outstanding classification accuracy at around 96%.

Analisis Arus Kas Operasi sebagai Alat Ukur Kinerja Keuangan

This research aims to determine the current ratio obtained by PT Siloam International Hospitals Tbk in 2019 - 2021, as well as to analyze the company's financial performance using the Operating Cash Flow Ratio, Cash Coverage to Interest Ratio, Total Debt Ratio, Cash Coverage to Current Liability Ratio, Expenditure Ratio Capital, Funds Flow Coverage Ratio, Free Net Cash Flow Ratio, and Cash Flow Adequacy Ratio. The method used in this research is a qualitative research method. From the research results, it can be concluded that the financial performance of PT Siloam International HospitalsTbk in 2019-2021, assessed from the operating cash flow ratio, was stated to be poor. The financial performance is considered average based on the calculation of the eight operating cash flow ratios. It had five ratios that did not meet standard 1, and only three ratios met standard 1. It showed that the company's ability to manage operating cash flow is still less than optimal. However, the financial performance of PT Siloam International Hospitals Tbk in 2019-2021 tended to increase from year to year, this can be seen from the eight operating cash flow ratios, seven ratios had increased so that the financial performance of PT Siloam International Hospitals Tbk was getting better from year to year.

LIQUIDITY-PROFITABILITY DYNAMICS: IS THE BANKING INDUSTRY RESILIENT IN TIMES OF CRISIS?

The banking industry contributes to the economic expansion since it is considered the keeper and supplier of liquid capital, essential for all commercial and industrial activity. The primary goal of commercial banks is to generate profits while serving clients and maintaining liquidity positions. Hence, this study aims to examine and evaluate the relationship between liquidity (measured through the Liquid assets and Liquid assets to short-term liabilities ratio) and profitability (measured through ROA and ROE) position of the commercial banking system in North Macedonia and Serbia in order to determine whether changes in liquidity levels influence profitability. Since the ten-year examination period (2012-2021) includes the emergence of the Coronavirus global health pandemic, additional tests were conducted to find out whether the sanitary crisis caused changes in the liquidity-profitability dynamics.By employing descriptive, correlation and regression analysis, and observing two sub-periods (2010-2019 vs 2020-2021), we infer changes in the liquidity-profitability positions in times of crisis in both countries. These findings reinvigorate the knowledge on liquidity and profitability performance in times of instability as this is a pioneer study in evaluating the pandemic impact on liquidity and performance using empirics in these two markets. Furthermore, by scrutinizing the interrelationship between liquidity and profitability, the findings reveal that associations are time-dependent, with policy implications for banks and financial industry regulators.

Liquidity Dynamics in Bangladesh: Investigating the Impact of Selected Macroeconomic Indicators Using an ARDL-ECM Method

The study scrutinizes the influence of the selective macroeconomic forces on the liquidity of Bangladesh. The ratio of excess reserve and total deposit liability is used to represent the liquidity of Bangladesh while total domestic credit, lending rate, consumer price index (CPI), excess reserve and exchange rate are selected as the macroeconomic forces. Using yearly data from 1986 to 2021, different time-series techniques have been used. Cointegration test explicates no cointegrating relationship among the variables. It has been found that 58% of the variation of liquidity is explained by the variation of liquidity itself 20% by domestic credit, 19% by consumer price index and another 12% by the other variables like excess reserve, exchange rate and lending rate. From the result of VAR lag order selection criteria, the maximum lag of the series is one. VAR model suggests the stability and no autocorrelation among the variables. From granger causality test, it can be inferred that domestic credit can forecast consumer price index, consumer price index can cause excess reserve of the country, consumer price index can forecast lending rate, domestic credit can cause increase or decrease the liquidity of the country, liquidity can granger cause excess reserve and excess reserve can cause any changes in liquidity. Lastly, excess reserve can predict lending rate. This results will help the policy makers to predict the liquidity trends and the impact of some selected macroeconomic variables contributing to predict the liquidity.

The effectiveness of tax control in the conditions of humanization of the criminal procedure legislation of the Russian Federation

The subject of the study is the existing tax control measures, statistical data of specialized organizations of the results of tax control measures. The object of the study is the effectiveness of the application of tax control measures. The purpose of the study is to improve the institute of tax control. The author considers the change in the procedure for initiating criminal proceedings on tax crimes and the consequences of such changes. In the course of the study, a retrospective of the procedure for initiating criminal cases in relation to the effectiveness of control tax measures is considered. The author suggests paying attention to the possibility of introducing videoconferencing, notification systems through the system of public services, securing the possibility of conducting control measures without the participation of witnesses. No less important is the ratio of tax liability and the realities of life, since the current situation indicates the apparent insignificance of penalties for tax offenses in the implementation of tax control measures. The novelty of the study is to study the impact of changes in the criminal procedure legislation of the Russian Federation on achieving the goals of protecting entrepreneurs. Attention is paid to the cyclical nature of the changes made by the legislator to the procedure for initiating criminal proceedings on tax crimes, which indicates the absence of a systematic approach to improving the criminal procedure and tax legislation of the Russian Federation. The debatable nature of the issue regarding the humanization of Russian criminal policy in relation to tax crimes is touched upon in the works of such scientific figures as Batyukova V.E., Nazarenko B.A., Rykun V.G., is discussed within the framework of the rule-making process, which sufficiently determines the prospects of scientific research. In particular, the authors point to the insufficient validity of more humane measures, which it is not possible to agree with. Statistics prepared by the audit and consulting organization FinExpertiza reflect the need to improve the legislative framework. The conclusions of the study are the need to improve control measures and introduce new ones that meet the realities of life. Proper regulation of tax legal relations seems to be a significant direction of state policy in the context of sanctions pressure.

The Research on the Impact of Customers on the Firms’ Green Behaviors

With the deterioration of the natural environment, how to promote the firms’ green behaviors has become an important topic. The study examined the impact of customers on the firms’ green behaviors. Then, we conducted empirical tests on the Chinese-listed companies. It has been found that green customers positively promote the firms’ green behaviors. Meanwhile, the assets liability ratio and the polluted industry strengthen the impact of customers on the firms’ green behaviors. This study makes suggestions that the government can drive the green development of the overall supply chain by providing support to customer-side firms.

Construction of fuzzy mathematical model for judging financial indexes of private enterprises under the perspective of deep learning

Abstract This paper introduces a novel financial evaluation framework combining deep learning, hierarchical analysis, and fuzzy comprehensive evaluation to form the AHP-fuzzy comprehensive model. This model is designed to refine financial analysis by constructing precise evaluation indexes and determining weight values, specifically tailored for the financial management of private enterprises. Through a case study on Enterprise A, focusing on solvency, operational efficiency, and cash flow, we observed significant trends: a decline in the quick ratio from 0.92 in 2017 to 0.49 in 2021, a decrease in the accounts payable turnover ratio from 2.58 in 2017 to 2.01 in 2020, and a concerning downward trend in the cash to current liabilities ratio, culminating in −11.30% in 2020. These findings validate the effectiveness of the AHP-fuzzy comprehensive evaluation model in providing nuanced financial assessments for private enterprises.

ANALYSIS OF THE VALIDITY OF TRADE-OFF AND PECKING ORDER THEORIES IN CAPITAL STRUCTURE DECISIONS OF SUSTAINABLE COMPANIES

In the study, it is aimed to test the validity of the Pecking Order Theory and Trade-Off Theory, which are among the theories on which the capital structure decisions of companies, which are extremely important in terms of firm value, are based, on sustainable companies included in the BIST Sustainability Index, since they carry out activities to reduce the cost of capital. In the study, the total indebtedness ratios, long-term indebtedness ratios and short-term indebtedness ratios of 40 companies included in the BIST Sustainability Index between 2015-2021, as well as liquidity, asset structure, non-debt tax shield, tax, profitability ratio, change in assets, firm size and the relationship between firm risk is examined. In general, the capital structure preferences of sustainable firms support the Trade-Off Theory. In addition, it was revealed that the dummy variable created for the periods when companies entered the BIST Sustainability Index was statistically significantly and positively related to their borrowing behavior. This result is interpreted in the direction of an increase in the borrowing rates of the companies after they are included in the index.

Has the COVID-19 pandemic affected the corporate financial performance? A case study of Slovak enterprises

Research background: The corporate debt situation can be considered a crucial factor influencing the future development of the financial performance of the firm. It is essential for every business entity to know its financial health, its strengths and weaknesses, and how its business has been affected by the COVID-19 pandemic and all the changes it has brought. Purpose of the article: The main aim of this paper is to explain and quantify the consequences of the COVID-19 pandemic, analyze changes in the growth of crucial determinants, and identify new trends in Slovak enterprises throughout the monitored period of 2018‒2021. Methods: Hence, a statistically significant difference between the individual indicators due to the period in which the firms achieved these values was determined using the Friedman test. It determined whether the average values of the financial indicators remained constant over the period under review (the years 2018 and 2019 are considered pre- COVID-19 years, while 2020 and 2021 are years when the globe was already being impacted by the outbreak of the COVID-19 pandemic) or whether the individual values of the indicators differed significantly. Findings & value added: Considering that there are statistically significant differences in the indicators of self-financing ratio, current indebtedness ratio, and equity leverage ratio in all monitored periods except for the years 2020 and 2021, where the average values of these debt indicators are the same, the results indicate that the COVID-19 pandemic also negatively impacted the indebtedness of Slovak enterprises. Although this research paper, focusing on the financial performance of the firms in the post-pandemic period, is pioneering in Slovakia, the biggest contribution of the study is the application of the latest information, which could help in more precise monitoring of corporate financial stability and debt policy during the current challenging period. The obtained results provide important universal guidelines for building financial strategies improving long-term financial resilience of enterprises.

Criminal and Administrative Legal Characteristics of Offenses in The Field of Countering Drug Trafficking: Insights from Ukraine

<em>Drug addiction in Ukraine has been showing signs of an epidemic and represents one of the potential threats to Ukraine's national security. This article highlights the regulation of the ratio of criminal and administrative liability as to countering offences in the sphere of trafficking of narcotic drugs, psychotropic substances, their analogues and precursors. The research method is presented as comparative-legal (legislation of Ukraine, Holland, Germany, Italy, Spain, Switzerland, Netherlands, Austria, Portugal and Finland) and systematic analysis. The sanctions for drug crimes provided for in the legislation, countries are divided into three groups, namely hard policy group, strict control group, and liberal group. Summing up the analysis of the legal regulation of the fight against drug crime in different countries, it should be noted that international legal acts govern most countries' legislation. At the same time, the legislation and executive system of punishments of various states in combating drug crimes are specific, due not so much to the country's national characteristics but to the concretely formed criminogenic situation in this area.</em>