Initially, you need to carefully evaluate the composition, as well as the timing of the formation of the debt, and then find out if several types of debt, in which there are significant differences in the timing of occurrence, were combined in one article. Since recently the lack of payments has become mass, while a significant part of receivables is overdue, and a certain part of it is that debt that is unlikely to be collected or will not be paid at all, we can say that in fact, customer debt increased in the current balance precisely because of too low payment discipline, and not because the business activity of the company increased. The possibility of overstatement due to accounts receivable, which is illiquid.If a general balance sheet liquidity indicator (formula) is used, it is rather difficult to predict any future payments or cash receipts, which is the main task of analyzing the company's current solvency. In this regard, all sorts of “dead” items, such as illiquid stocks of various inventories, may be included in the composition of assets. Static The obtained indicators are calculated based on the balance sheet data, which show the property status of the company according to its condition at a certain date, as a result of which they are simultaneous.In this regard, a detailed analysis of their dynamics at different time periods is required.The general indicator of balance sheet liquidity (formula) has several disadvantages, namely: The practice of domestic and foreign companies showed that if a company has a coefficient value of more than two, then for industrial enterprises this is more likely an exception to the rule, because there are many reasons from which it is worth highlighting the main one for domestic companies - this is a lack of equity, as well as the need in the direction of the resulting net profit directly to the needs of consumption. But the main advantage that a common liquidity indicator (formula) has is the ease of calculation, and not some kind of universality or comprehensiveness, which they often try to attribute to it. Of course, today this ratio is used most often. The general liquidity indicator, the calculation formula of which can be used at any time periods, has a somewhat exaggerated influence on the assessment of a company's ability to meet its obligations, and especially not the most optimal decision to use it as the main criterion for a potential bankruptcy of the company (other characteristics are its derivatives). Speaking from the point of view of the performance of a particular enterprise, a significant accumulation of reserves, as well as additional diversion of funds into accounts receivable, is often due to the fact that the company has inept asset management. Lenders consider such a formation own working capital most relevant. It is believed that when the overall liquidity ratio of a company is below 2: 1, then in this case it does not have the ability to fully repay all obligations it has on time.Ī significant excess of assets over liabilities (which is an extremely rare situation for domestic enterprises) suggests that the company has a fairly large number of free resources that it generates from its sources. In particular, it is worth noting that due to various reasons, including the significant proportion of all kinds of hard-to-sell assets, as well as the duration of the operating cycle of various construction or industrial enterprises, it is necessary to provide a higher coefficient compared to the value that is acceptable for enterprises operating in the areas of supply, trade and marketing. Of course, the general indicator of liquidity will vary depending on the specific field of activity of the enterprise. It is quite difficult to justify the acceptable indicator. The higher the overall liquidity indicator, the more confidence there will be that it will be able to repay all of the company's obligations at the expense of those assets that are available to it. Thus, it is possible to determine how much current assets of the organization are able to cover any Short-term liabilities. General liquidity ratio or total liquidity ratio - this is the ratio of current assets of the company to its short-term liabilities.
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