Audit and economical analysis

An analysis of the company's financial condition

The financial condition of the entity as a economic category determines the state of capital in terms of the business entity's ability to operate, develop, and finance its own. Ie, the level of financial resources provided by the economic entity, the level of their targeted and effective use, the financial relationships with other legal and natural entities, the condition of solvency and financial stability.

The financial condition of the entity determines the set of categories and processes that describe its financial resources availability, the level of competitiveness and bankruptcy, the financial stability and solvency status, the ability to meet its obligations to the state and other business entities.

Using the financial situation to analyze and analyze the economic activity of an economic entity and to evaluate its ability to grow, access to financial resources of production, commercial and financial activities, and the growth of their financial status levels, expectations of financial results, and determination of ways to increase economic profitability based on real business opportunities, and to identify measures to effectively utilize financial resources.

Increasing the profitability of the enterprise, optimizing its capital structure and ensuring its financial stability, increasing the attractiveness of the property (for shareholders, founders), investors and lenders, forming an effective mechanism for managing business , as well as through the use of all opportunities of the market mechanism to attract financial resources.

By evaluating the financial situation, it has two outcomes. The first is the evaluation of the operation of the enterprise management apparatus, and the second one is to forecast some of the financial performance.

The financial reporting standards in international financial reporting standards are categorized as follows. Financial statements are an adjusted statement of the financial condition and financial results of a business entity. The objective of financial reporting is to provide information about the financial position, financial results and cash flows of a business entity that is useful for making different economic decisions for different users. Financial statements also reflect the outcomes of managing resources entrusted to management. To achieve this objective, financial statements provide information on the following aspects of business entities: assets, liabilities, capital, income and expenses, profit and loss, cash and cash equivalents and cash flows.

These data, along with other information in the notes, help users of financial statements predict future cash flows of a business entity, in particular, their timing and validity.

The above-mentioned balance sheet refers to the financial position of the business entity and, therefore, is more commonly known as the statement of financial position in international financial reporting standards.

The statement of financial position is made for two periods, ie beginning and end of the period and reflected in the same report. This is due to the need to analyze the immediate financial situation and to identify changes simultaneously. This procedure is described in international financial reporting standards as follows.

"The business entity shall have at least two financial statements, two reports of profit or loss and other comprehensive income, two separate profit or loss statements (if any, should report two cash flow statements and statements of changes in equity and relevant explanations. 30 "This is due to the minimum comparative analysis.

In the International Financial Reporting Standards, the business entity has yet another important aspect that subjects should additionally provide a third set of financial statements as at the beginning of the preceding period, in addition to the minimum comparative financial statements, :

(a) it retrospectively reclassifies or reclasses items in its financial statements when it applies retrospectively the accounting policies;

(b) retrospective application, retrospective restatement or reclassification has had a material impact on the information reflected in the previous financial reporting period.

According to the procedure, the economic entity shall submit three financial statements for the following period:

(a) at the end of the current period;

(b) at the end of the previous period;

(c) at the beginning of the previous period.

Increasing the time periodicity of information makes it possible for users to evaluate trends in financial decision-making, especially for forecasting purposes.

In some cases, it is not possible to reclassify comparative data in a particular prior period to achieve comparability with the current period. For example, a business entity may not have accumulated data from the previous period (s) so that it allows reclassification, and data may not be reproduced.

At the minimum, a statement of financial position should include items that should reflect the following amounts: (a) fixed assets; (b) investment property; (v) intangible assets; (g) financial assets; (d) investments accounted for by equity method; (e) biological assets; (j) inventory; (z) trade and other receivables; (i) cash and cash equivalents; (y) assets classified as held for sale and assets included in grouping of classified items that are classified as held for sale; (k) trade and other payables; (l) reserves; (m) financial liabilities; (n) current tax liabilities and assets; (o) prolonged tax liabilities and deferred tax assets; (p) liabilities to groups of items that are classified as held for sale; (r) shares that are not controlled by the equity component; (c) capital and equity reserves owned by the parent.

Business entities must provide supplementary articles, headings and collections provided in the heading of the financial statement, when such submission is appropriate for understanding the financial condition of a business entity.

If the business entity reflects current and long-term assets and current and long-term liabilities as a separate category in its statement of financial position, it shall apply those deferred tax assets (liabilities) as current assets (liabilities) should not be classified.

The list of items that significantly differentiate the essence or the function of the undertaking subject to the separate presentation in the financial statement include:

(a) items are specified in the separate paragraphs of the report where the size, nature or function of the substance or group of substances requires the submission of these articles separately to understand the financial condition of the business entity;

(b) the nature of the description used and the group of substances or similar substance used to provide information relevant to the understanding of the financial condition of the undertaking undertaken by the nature of the undertaking and its operations can be modified.

The economic entity may provide supplementary information on the basis of the following:

(a) the nature and liquidity of the assets;

(b) the role of assets within the business entity;

(c) the amount, nature and timing of the obligation.

An entity may disclose items that are more detailed in the statement of financial position or in its Comments, in the line items that are classified and reflected in their lineage.

An entity shall disclose in the notes, notes and disclosures in the statement of financial position: (a) principal receivables, receivables, (c) inventories, (g) reserves, (d) ) Information on capitalization.

The entity shall disclose:

(a) the statement of financial position or statement of changes in equity;

(b) the number of shares issued, the number of issued and fully paid shares, and the number of issued but not fully paid shares, the nominal value of each share or the nominal the amount of shares outstanding, the number of shares outstanding, the number of shares outstanding, and the restriction on the distribution of the dividends and the return of the capital, the rights of the subject or other subsidiary or affiliated share holdings, options and stocks held for sale under share sale agreements, including their terms and sums);

(c) a description of the nature and purpose of each reserve in equity.

The main tasks for the financial situation analysis can be summarized and complemented by the following lines, based on sources 31.

Business entities:

- analysis of capital and liabilities and their changes;

- analysis of mobility and mobility of funds;

- analysis of capital and turnover capital;

- analysis of economic and financial potential;

- analysis of activity;

- analysis of financial stability of companies and companies;

- analysis of informing and creditor obligations

- evaluation of the economic and financial rating;

- identification of internal opportunities for the improvement of the financial status and the establishment of measures for their establishment.