Debt capital structure ratio is equal to zero shows. The capital structure ratio is the basis for assessing the solvency of a business and its financial condition. The numerical value of the signal

The second group of indicators that we analyze within the framework of this methodology are indicators of the capital structure (financial stability ratios), which reflect the ratio of own and borrowed money in the sources of financing of the organization, i.e. characterize the degree of its financial independence from creditors. To build a methodology for recognizing the latent stage of the crisis, the following indicators were identified (Table 4.4):

1) share equity in working capital, or equity ratio(K 9), calculated as the ratio of own funds in circulation to the entire value of working capital. The indicator characterizes the ratio of own and borrowed working capital and determines the degree of security of the economic activity of the organization with its own working capital necessary for its financial stability.

2) Autonomy coefficient(K 10), or financial independence, calculated as the quotient of equity divided by the amount of the organization's assets, and determining the share of the organization's assets that are covered by equity (provided by own sources).

The remaining share of the assets is covered by borrowed funds. The indicator characterizes the ratio of own and borrowed capital of the organization.

3) The ratio of total liabilities to total assets(K 11) - an indicator reflecting the share of assets that is financed by long-term and short-term loans.

Table 4.3

Solvency indicators

№ p/n	Index	Conv. designation	Index calculation formula	Calculation formula coefficient	Value interval	Number value signal
	Index of growth (decrease) of the ratio A 2 / P 2			K 2 \u003d (p. 230 + p. 240) / p. 690 of form No. 1
					0.8≤I 1<0,9
					0.7≤I 1<0,8
					0.5≤I 1<0,7
	Index of growth (decrease) in the degree of solvency of the general			K 2 \u003d (DO + KO) / V cf m K 2 \u003d (p. 690 + p. 590 of form No. 1) / V cf m
					1,1
					1,2
	Growth (decrease) index of debt ratio on bank loans and loans			K 3 \u003d (DO + Z) / V cf m K 3 \u003d (p. 590 + p. 610 of form No. 1) / V cf m
					1,1
					1,2
	Index of growth (decrease) in the ratio of debt to other organizations			K 4 \u003d KZ / V cf m K 4 \u003d (p. 621 + p. 622 + + p. 623 + p. 627 + + p. 628 of form No. 1) / V cf m
					1,1
					1,2
	Growth (decrease) index of debt ratio to the fiscal system			K 5 \u003d ZB / V cf m K 5 \u003d (p. 625 + p. 626 of form No. 1) / V cf m
					1,1
					1,2
	Growth (decrease) index of domestic debt ratio			K 6 \u003d ZV / V cf m K 6 \u003d (p. 624 + p. 630 + + p. 640 + p. 650 + + p. 660 of form No. 1) / V cf m
					1,1
					1,2
	Index of growth (decrease) of the degree of solvency on current liabilities			K 7 \u003d KO / V cf m K 7 \u003d p. 690 of form No. 1 / V cf m
					1,1
					1,2
	Growth (decrease) index of coverage of current liabilities by current assets			K 8 \u003d OA / KO K 8 =p. 290/str. 690 form No. 1
					0.8≤I 8<0,9
					0.7≤I 8<0,8
					0.5≤I 8<0,7

Table 4.4

Capital structure indicators

№ p/n	Index	Conv. designation	Calculation formula index	Calculation formula coefficient	Value interval	Number value signal
	Index of growth (decrease) of the equity ratio			K 9 \u003d SK-VA / OA K 9 \u003d (p. 490-p. 190) / p. 290 of form No. 1)
					0.8≤I 9<0,9
					0.7≤I 9<0,8
					0.5≤I 9<0,7
	Index of growth (decrease) of the coefficient of autonomy			K 10 \u003d SK / (VA + OA) K 10 \u003d p. 490 / (p. 190 + p. 290 of form No. 1)
					0.9≤I 10<1
					0.8≤I 10<0,9
					0.7≤I 10<0,8
					0.5≤I 10<0,7
	Growth (decrease) index of the ratio of total liabilities to total assets			K 11 \u003d (DO + KO) / (VA + OA) K 11 \u003d (p. 590 + p. 690) / (p. 190 + p. 290 of form No. 1)
					1
					1,1
					1,2
					1,5
	Growth (decrease) index of the ratio of long-term liabilities to assets			K 12 \u003d DO / (VA + OA) K 12 \u003d p. 590 / (p. 190 + p. 290 of form No. 1)
					1
					1,1
					1,2
					1,5
	Growth (decrease) index of the ratio of total liabilities to equity			K 13 \u003d (DO + KO) / SK K 13 \u003d (p. 590 + p. 690) / p. 490 of form No. 1
					1
					1,1
					1,2
					1,5
	Growth (decrease) index of the ratio of long-term liabilities to non-current assets			K 14 \u003d DO / VA K 14 \u003d p. 590 / p. 190 of form No. 1
					1
					1,1
					1,2
					1,5

Designations for table 4.4: SC - capital and reserves of the organization; VA - non-current assets.

4) The ratio of long-term liabilities to assets(K 12) shows the share of assets financed by long-term loans.

5) The ratio of total liabilities to equity(K 13) - the ratio of credit and own sources of financing.

6) The ratio of long-term liabilities to non-current assets(K 14) shows what proportion of fixed assets is financed by long-term loans.

3. The third group - indicators of the effectiveness of the use of working capital, profitability and financial results, evaluating the velocity of circulation of funds invested in current assets. In this methodology, they are supplemented by coefficients of working capital in production and in calculations, the values ​​of which characterize the structure of current assets (Table 4.5):

1) Working capital ratio (K 15 ) is calculated by dividing the current assets of the organization by the average monthly revenue and characterizes the volume of current assets, expressed in the average monthly income of the organization, as well as their turnover. This indicator estimates the speed of circulation of funds invested in current assets.

2) Working capital ratio in production (TO 16 ) is calculated as the ratio of the cost of working capital in production to the average monthly revenue. Working capital in production is defined as funds in stock, including VAT, minus the cost of goods shipped.

The coefficient characterizes the turnover of the organization's inventory. Its values ​​are determined by the industry specifics of production, characterize the effectiveness of the production and marketing activities of the organization.

3) Working capital ratio in calculations (K 17 ) determines the rate of circulation of current assets of the organization that are not involved in direct production. It characterizes, first of all, the average terms of settlements for shipped, but not yet paid for products, that is, it determines the average terms for which the working capital that is in the calculations is withdrawn from the production process. Also, it can give an idea of ​​how liquid the products manufactured by the organization are, and how effectively its relationships with consumers are organized, characterizes the likelihood of doubtful and bad receivables and their write-off as a result of shortfalls in payments, that is, the degree of commercial risk.

4) Return on working capital (K 18 ) reflects the efficiency of working capital use. The index determines how much profit falls on one ruble invested in current assets.

5) Return on sales (K 19 ) reflects the ratio of profit from the sale of products and income received in the reporting period (Table 4.5).

Table 4.5

Indicators of the efficiency of the use of working capital, profitability and financial results

№ p/n	Index	Conv. designation	Calculation formula index	Formula calculation coefficient	Value interval	Number signal value
	Growth (decrease) index of working capital ratio			K 15 \u003d OA / V cf m K 15 \u003d p. 290 of form No. 1 / B cf m
					0.9≤I 15<1
					0.8≤I 15<0,9
					0.7≤I 15<0,8
					0.5≤I 15<0,7
	Growth (decrease) index of working capital ratio in production			K 16 \u003d OSB / V cf m K 16 \u003d (p. 210 + p. 220-p. 215 of form No. 1) / V cf m
					0.9≤I 16<1
					0.8≤I 16<0,9
					0.7≤I 16<0,8
					0.5≤I 16<0,7
	Growth (decrease) index of working capital ratio in calculations			K 17 \u003d OSR / V cf m K 17 \u003d (p. 290-p. 210 + p. 215 of form No. 1) / V cf m
					0.9≤I 17<1
					0.8≤I 17<0,9
					0.7≤I 17<0,8
					0.5≤I 17<0,7
	Index of growth (decrease) of profitability of working capital			K 18 \u003d P / OA K 18 \u003d p. 160 of form No. 2 / p. 290 of form No. 1
					0.9≤I 18<1
					0.8≤I 18<0,9
					0.7≤I 18<0,8
					0.5≤I 18<0,7
	Index of growth (decrease) of profitability of sales			K 19 \u003d P pr / V K 19 = p.050 / p.010 form No. 2
					0.9≤I 19<1
					0.8≤I 19<0,9
					0.7≤I 19<0,8
					0.5≤I 19<0,7
	Growth (decrease) index of average monthly output per employee			K 20 \u003d V cf m / SHR K 20 \u003d V cf m / p. 760 of form No. 5
					0.9≤I 20<1
					0.8≤I 20<0,9
					0.7≤I 20<0,8
					0.5≤I 20<0,7

Average monthly output per worker ( K 20 ) determines the efficiency of using the organization's labor resources and the level of labor productivity, and also characterizes the financial resources for conducting business activities and fulfilling obligations, reduced to one employee of the analyzed organization (Table 4.5).

Legend for table 4.5:

OSB - working capital in production;

OSR - working capital in settlements;

P - profit after payment of all taxes and deductions;

P pr - profit from sales; B - the organization's revenue;

SHR - the average number of employees of the organization.

4. The last group of indicators included in the methodology is performance indicators for the use of non-working capital and investment activity, characterizing the efficiency of the use of fixed assets of the organization and determining how the total amount of available fixed assets (machinery, equipment, buildings, structures, vehicles) corresponds to the scale of the organization's business.

We used the following indicators (Table 4.6):

1) Efficiency of non-working capital, or capital productivity (TO 21 ), which is determined by the ratio of average monthly revenue to the cost of non-working capital and characterizes the efficiency of the use of fixed assets of the organization.

Less than the industry average, the value of this indicator characterizes the insufficient workload of equipment in the event that the organization in the period under review has not acquired new expensive fixed assets.

While a very high value of this indicator may indicate both a full load of equipment and the absence of reserves, and a significant degree of physical and moral deterioration of outdated production equipment.

2) Investment activity ratio (K 22 ), characterizing investment activity and determining the amount of funds allocated by the organization for the modification and improvement of property, as well as for financial investments in other organizations.

Strong deviations of this indicator in any direction may indicate an incorrect strategy for the development of the organization or insufficient control of management over the activities of management.

3) Profitability ratio of non-current assets (K 23 ), demonstrating the ability of the organization to provide a sufficient amount of profit in relation to fixed assets.

4) Return on investment ratio (K 24 ), showing how many monetary units it took the organization to receive one monetary unit of profit. This indicator is one of the most important indicators of competitiveness.

Legend for table 4.6:

NA - intangible assets;

OS - fixed assets.

Table 4.6

Indicators of the effectiveness of the use of non-working capital and investment activity

№ p/n	Index	Conv. designation	Index calculation formula	The formula for calculating the coefficient	Value interval	Number value signal
	Index of growth (decrease) of capital productivity			K 21 \u003d V cf m / VA K 21 \u003d V cf m / p. 190 of form No. 1
					0.9≤I 21<1
					0.8≤I 21<0,9
					0.7≤I 21<0,8
					0.5≤I 21<0,7
	Growth (decrease) index of investment activity ratio			K 22 \u003d (VA-ON-OS) / VA K 2 \u003d (p. 130 + p. 135 + P. 140)/ P. 190 Form No. 1
					0.9≤I 22<1
					0.8≤I 22<0,9
					0.7≤I 22<0,8
					0.5≤I 22<0,7
	Index of growth (decrease) of the profitability ratio of non-current assets			K 23 \u003d P / VA K 23 \u003d p. 160 of form No. 2 / p. 190 of form No. 1
					0.9≤I 23<1
					0.8≤I 23<0,9
					0.7≤I 23<0,8
					0.5≤I 23<0,7
	Growth (decrease) index of return on investment ratio			K 24 \u003d P / (SK + DO) K 24 \u003d p. 160 of form No. 2 / (p. 490 + p. 590 of form No. 1)
					0.9≤I 24<1
					0.8≤I 24<0,9
					0.7≤I 24<0,8
					0.5≤I 24<0,7

After assigning a numerical value to each signal about the threat of a latent crisis (s i , i=1..n, where n is the number of indicators selected for analysis), it is proposed to aggregate the obtained data into a table of the following form:

Table 4.7

Numerical values ​​of signals about the threat of a crisis

№ p/n	Signal of the threat of a crisis	The numerical value of the signal

Such tables must be built for each group of indicators.

Further, it is proposed to introduce two intermediate indicators (S is the counter of true conditions, and F is the counter of the total strength of signals about the threat of a hidden crisis), the calculation of which is carried out according to the following algorithm:

To calculate the magnitude of the threat of a hidden crisis for each group of indicators or for the organization as a whole, it is proposed to use the following formula:

where M is the scale of signals about the threat of a hidden crisis;

n - the number of analyzed indicators for the group or for the organization as a whole.

The magnitude of signals about the threat of a crisis characterizes the crisis in terms of its breadth of coverage and gives an idea of ​​the number of areas covered by a latent crisis, or in which the development of a crisis is possible in the near future.

The intensity of the crisis threat is proposed to be calculated by the formula:

(4.39)

where I′ is the intensity of signals about the threat of a latent crisis;

r is the dimension of the scale of the numerical values ​​of the signals (here r=5).

The intensity of signals about the threat of a crisis characterizes the crisis in terms of the depth of coverage and gives an idea of ​​the level of threat of a latent crisis.

The scale and intensity of signals about the threat of a crisis are proposed to be assessed according to the following scale (Table 4.8):

Table 4.8

Linguistic assessment of the scale and intensity of signals about the threat of a crisis

№ p/n	Numerical value of the indicator	Linguistic evaluation of the indicator	Forecast
		extremely low	Potential
			Hidden Crisis	nascent
				Developing
		extremely high		Progressive

Values ​​of indicators above 40% allow us to conclude that there is a hidden crisis in the organization.

With values ​​of indicators less than 40%, the probability of a latent crisis is low, the state is characterized as a potential crisis with the subsequent possible development of a latent crisis.

1) The technique developed and presented by us allows us to recognize the earliest stages of the crisis, including the stage of the latent crisis, which are characterized by the absence of visible symptoms of the development of crisis phenomena and cannot be diagnosed by standard methods;

2) When constructing the methodology, a system of indices was used, which makes it possible to evaluate the performance of the organization in dynamics, which gives a more objective assessment of the development of crisis phenomena in the organization and allows taking into account even minimal deviations in its work;

3) The linguistic scale of assessing signals about the threat of a crisis makes it possible not only to draw a conclusion about the presence or absence of a hidden crisis, but also to calculate the magnitude and intensity of the development of the crisis;

4) The developed methodology allows assessing the crisis both in terms of breadth and depth of coverage, which makes it possible to further develop a set of appropriate measures to localize and overcome the hidden crisis in the organization.

Bulletin of the Chelyabinsk State University. 2009. No. 2 (140). Economy. Issue. 18. S. 144-149.

S. N. Ushaeva

performance indicators of the firm's capital structure

A range of issues related to the optimization of the company's capital structure, which should ensure its minimum price, the optimal level of financial leverage and the maximization of the company's value, are highlighted. As indicators of the effectiveness of the capital structure, the coefficients for evaluating profitability and financial stability are considered. The mechanism of the impact of financial leverage on the level of profitability of equity capital and the level of financial risk is described.

Key words: capital, capital structure, performance indicators of the capital structure, financial leverage, company value, equity and borrowed capital, profitability, financial stability.

At the present stage of development of the economic system, economic entities face a number of tasks that require an optimal solution. One of these tasks is to determine an effective capital structure that meets the requirements of both the economic situation as a whole (the dynamism and uncertainty of external influences due to the influence of globalization and the expansion of the range of possible, associated with an increase in risk, options for the application of available resources), and the company's management on a certain the stage of its development (the competitive environment assumes the effective functioning of only economic entities that are able not only to attract resources, but also to determine their ratio, which would be optimal under the given conditions). Such an optimal

the capital structure implies ensuring the financial stability of the company, its current liquidity and solvency, as well as the required return on invested capital.

Ensuring current liquidity and solvency is associated with the optimization of working capital, which guarantee the continuity of the processes of production and circulation of goods (liquidity). The lower the net working capital, the higher the efficiency (profitability, turnover), but the higher the risk of insolvency.

Ensuring an efficient capital structure depends on the ratio of own and borrowed funds, which develops when choosing sources of financing (see figure) . Managers' decisions to use loans are related to the action of financial leverage.

Sources of financing the company's activities and directions for their use

(financial leverage); by increasing the share of borrowed funds, it is possible to increase the return on equity, but at the same time, financial risk will increase, i.e., the threat to become dependent on creditors in the event of a lack of money to pay off loans. This is the risk of loss of financial stability. The condition under which it is expedient to attract borrowed funds is that the prevailing profitability of the company's assets exceeds the interest rate for the loan.

In this case, the risk is justified by the increase in return on invested equity capital. In this regard, the task of management is to optimize the capital structure by evaluating and comparing the cost of various sources of financing, taking into account profitability.

The ability of an enterprise to generate the necessary profit in the course of its economic activity determines the overall efficiency of the use of assets and invested capital, characterizes the coefficients for assessing profitability (profitability). The following key indicators are used to carry out such an assessment.

1. The profitability ratio of all assets used, or the economic profitability ratio (P). It characterizes the level of net profit generated by all the assets of the enterprise that are in its use on the balance sheet. The calculation of this indicator is carried out according to the formula

where NPO is the total amount of net profit of the enterprise received from all types of economic activity in the period under review; Ap - the average cost of all used assets of the enterprise in the period under review (calculated as an average chronological).

2. The return on equity ratio, or the financial profitability ratio (Rsk), characterizes the level of profitability of equity capital invested in the enterprise. The following formula is used to calculate this indicator:

Rsk SKsr "1)

where NPO is the total amount of the net profit of the enterprise received from all types of economic

activities during the period under review; SKr - the average amount of equity capital of the enterprise in the period under review (calculated as the average chronological) [Ibid.].

3. The profitability ratio of product sales, or the coefficient of commercial profitability (Рр), characterizes the profitability of the operating (production and commercial) activities of the enterprise. This indicator is calculated according to the following formula:

where NPR - the amount of net profit received from the operating activities of the enterprise in the period under review; OR is the total volume of product sales in the period under review [Ibid. S. 59].

4. The profitability ratio of current costs (Rt) characterizes the level of profit received per unit of costs for the implementation of the operating (production and commercial) activities of the enterprise. To calculate this indicator, the formula is used

where Nprp - the amount of net profit received from the operating (production and commercial) activities of the enterprise in the period under review; And - the sum of the costs of production (circulation) of the enterprise in the period under review [Ibid.].

5. The return on investment ratio (Ri) characterizes the profitability of the investment activity of the enterprise. The calculation of this indicator is carried out according to the following formula:

where NPI - the amount of net profit received from the investment activity of the enterprise in the period under review; IR is the sum of investment resources of an enterprise invested in objects of real and financial investment [Ibid.].

Management of current liquidity / payment capacity in general includes making decisions on the liquidity of the company's assets and the priority of debt payments; share these concepts

can be as follows: current liquidity characterizes the potential ability to pay off one's short-term obligations, solvency - the ability to actually realize this potential. A sign of solvency, as you know, is the presence of money in the company's current account and the absence of overdue accounts payable, and liquidity is assessed by comparing the positions of current assets and current liabilities.

On the scheme of financial equilibrium, current liquidity lies on the opposite side of profitability "in the balance" - this illustrates the inevitability of a choice between profitability and risk. The smaller the share of liquid assets in the total amount of working capital, the greater the profit, but the higher the risk. Achieving high profitability by directing resources to any one, the most profitable, area of ​​activity can lead to a loss of liquidity, namely, to interrupt the production and circulation of goods at other stages and lengthen the financial cycle. At the same time, excessive binding of financial resources (for example, in stocks) also lengthens the financial cycle and means a relative outflow of funds from more profitable current activities. It is clear that “thrifty”, cautious management is inferior in terms of profitability to management in those firms where managers mobile and flexibly coordinate the financial cycle and put the principle “time is money” at the forefront.

Structural liquidity and financial soundness serve as a fundamental pillar of governance. In a broad sense, financial stability is the ability of a company to maintain the target structure of funding sources. The owners of the company (shareholders, depositors, shareholders, etc.) prefer a reasonable increase in the share of borrowed funds. Lenders prefer firms with a high share of equity, with greater financial independence. Managers are called upon to find a reasonable balance between the interests of owners and creditors, observing the developed financing rules, and the analysis of the balance sheet structure serves as a tool for such management decisions.

As you know, in the liabilities of the analytical balance sheet, positions are distinguished: equity,

borrowed capital - long-term and short-term. The requirement for the vertical structure of capital (a condition of financial stability) is that own sources of financing exceed borrowed ones: SC > SC.

Structural liquidity also depends on investment decisions within the framework of asset management: according to the hedged approach to financing, each category of assets must correspond to liabilities of one kind or another. For example, in the process of property formation, one should remember the so-called “golden rule” of financing, which describes the requirement for a horizontal balance sheet structure: the amount of equity must cover the value of non-current assets: SC > VNA. In addition to direct comparison of balance sheet positions, analytical coefficients are used to analyze the implementation of financing rules. These include: autonomy ratio, financing ratio, debt ratio, long-term financial independence ratio, equity capital agility ratio.

To identify the level of financial risk associated with the structure of the sources of formation of the capital of the enterprise, and, accordingly, the degree of its financial stability in the process of future development, the coefficients for assessing the financial stability of the enterprise allow.

1. The coefficient of autonomy (KA) shows to what extent the volume of assets used by the enterprise is formed from its own capital and to what extent it is independent of external sources of financing. The calculation of this indicator is carried out according to the following formulas:

where SC is the amount of equity capital of the enterprise on a certain date; NA - the value of the net assets of the enterprise on a certain date; K - the total amount of capital of the enterprise on a certain date; A - the total value of all assets of the enterprise on a certain date.

2. Funding ratio (CF), which characterizes the amount of borrowed funds per unit of equity capital, i.e. the degree of dependence of the enterprise on external sources of financing.

where ZS - the amount of borrowed capital (average or for a certain date); SC - the amount of equity capital of the enterprise (average or on a certain date) [Ibid.].

3. Debt ratio (KZ). It shows the share of borrowed capital in the total amount used. The calculation is carried out according to the following formula:

where ZK is the amount of borrowed capital attracted by the enterprise (average or as of a certain date); K - the total amount of capital of the enterprise (average or on a certain date) [Ibid. S. 53].

4. Ratio of long-term financial independence (KDN). It shows the extent to which the total volume of assets used is formed at the expense of the company's own and long-term borrowed capital, i.e. characterizes the degree of its independence from short-term borrowed sources of financing. This indicator is calculated by the formula

where SC is the amount of the company's own capital (average or as of a certain date); ZK - the amount of borrowed capital attracted by the enterprise on a long-term basis (for a period of more than one year); A - the total value of all assets of the enterprise (average or for a certain date) [Ibid.].

5. The coefficient of maneuverability of own capital (KMsk) shows what is the share of own capital invested in current assets in the total amount of own capital (i.e. what part of the own capital is in its highly turnover and highly liquid form). The calculation of this indicator is carried out according to the following formula:

where SOA - the amount of own current assets (or own working capital); SC is the total amount of equity capital of the enterprise [Ibid.].

These ratios are interrelated: for example, if the coverage ratio of non-current assets with equity capital is greater than one, then the company has no problems with liquidity and financial stability - short-term debt is less than current assets, and the current liquidity ratio is greater than one.

Not only the current financial condition depends on the financial balance, but also the investment attractiveness of the company, and the prospects for its development. The optimal capital structure ensures financial stability, maximizes the level of financial profitability, minimizes the level of financial risks, as well as its cost. Violation of the financial balance causes financial difficulties, may lead to insolvency and bankruptcy. To monitor the financial balance, managers should regularly analyze reporting data using the proposed indicators, which helps to answer the questions: what is the current state and whether there are certain “distortions” caused by certain incorrect or risky decisions, and to correct this process in a timely manner.

So, one of the main tasks of capital formation - optimization of its structure, taking into account a given level of its profitability and risk - is solved by different methods. One of the main mechanisms for the implementation of this task is financial leverage.

Financial leverage characterizes the use of borrowed funds by an enterprise, which affects the change in the return on equity ratio. In other words, financial leverage is an objective factor that arises with the advent of borrowed funds in the amount of the enterprise's capital and allows it to receive additional profit on equity.

An indicator that reflects the level of additionally generated return on equity with a different share of the use of borrowed funds is called the effect of financial leverage. It is calculated using the following formula:

EFL _ (1 - SNp) X (KVRa - PC) X SK, (12)

where EFL is the effect of financial leverage, which consists in the increase in the return on equity ratio,%; C - becoming-

ka income tax, expressed as a decimal fraction; КВРа - coefficient of gross profitability of assets (the ratio of gross profit to the average value of assets),%; PC - the average amount of interest on a loan paid by the enterprise for the use of borrowed capital,%; ZK - the average amount of borrowed capital used by the enterprise; SC - the average amount of equity capital of the enterprise.

There are three main components in the formula for calculating the effect of financial leverage:

1) tax corrector of financial leverage (1 - SNP), which shows the extent to which the effect of financial leverage is manifested in connection with different levels of income taxation;

2) financial leverage differential (KVRa - PC), which characterizes the difference between the gross return on assets and the average interest rate for a loan;

3) financial leverage ratio ZK L

I, which characterizes the amount of borrowed

capital used by the enterprise, per unit of equity.

The selection of these components allows you to purposefully manage the effect of financial leverage in the process of financial activity of the enterprise.

The tax corrector of financial leverage practically does not depend on the activity of the enterprise, since the income tax rate is set by law. At the same time, in the process of managing financial leverage, a differentiated tax corrector can be used in the following cases: a) if differentiated income tax rates are established for various types of enterprise activities; b) if for certain types of activities the enterprise uses tax benefits on profits; c) if individual subsidiaries of the enterprise operate in the free economic zones of their country, where there is a preferential regime for profit taxation; d) if individual subsidiaries

enterprises operate in states with a lower level of profit taxation.

In these cases, by influencing the sectoral or regional structure of production (and, accordingly, the composition of profit in terms of its taxation level), it is possible, by reducing the average profit tax rate, to increase the influence of the financial leverage tax corrector on its effect (ceteris paribus).

The main condition for achieving a positive effect of financial leverage is its differential. This effect manifests itself only when the level of gross profit generated by the assets of the enterprise exceeds the average interest rate for the loan used (a value that includes not only its direct rate, but also other unit costs for attracting, insuring and servicing it), i.e. when the financial leverage differential is positive. The greater the positive value of the financial leverage differential, the greater, other things being equal, its effect will be.

Due to the high dynamism of this indicator, it requires constant monitoring in the process of managing the effect of financial leverage. This dynamism is due to a number of factors.

First of all, during a period of deterioration in the financial market (primarily, a reduction in the supply of free capital), the cost of borrowed funds may increase sharply, exceeding the level of gross profit generated by the assets of the enterprise.

In addition, a decrease in the financial stability of an enterprise in the process of increasing the share of borrowed capital used leads to an increase in the risk of bankruptcy, which forces creditors to increase the interest rate for a loan, taking into account the inclusion of a premium for additional financial risk. At a certain level of this risk (and, accordingly, the overall interest rate for a loan), the financial leverage differential can be reduced to zero (at which the use of borrowed capital will not increase the return on equity) and even acquire a negative value (at which the return on equity will decrease, so how part of the net profit generated by it will go to maintenance

borrowed capital at high interest rates). Finally, during the deterioration of the commodity market, the volume of sales of products decreases, and, accordingly, the size of the gross profit of the enterprise from operating activities. Under these conditions, the value of the financial leverage differential may become negative even at unchanged interest rates for a loan due to a decrease in the gross return on assets.

The formation of a negative value of the financial leverage differential for any of the above reasons always leads to a decrease in the return on equity ratio. In this case, the use of borrowed capital by the enterprise has a negative effect.

The financial leverage ratio is the leverage that multiplies (changes in proportion to the multiplier or coefficient) the positive or negative effect obtained due to the corresponding value of its differential. With a positive value of the differential, any increase in the financial leverage ratio will cause an even greater increase in the return on equity ratio, and with a negative value of the differential, an increase in the financial leverage ratio will lead to an even greater rate of decline in the return on equity ratio. In other words, an increase in the financial leverage ratio multiplies an even greater increase in its effect (positive or negative, depending on the positive or negative value of the financial leverage differential). Similarly, a decrease in the financial leverage ratio will backfire, further reducing its positive or negative effect.

Therefore, with a constant differential, the financial leverage ratio can be the main generator of both the increase in the amount and level of return on equity, and the financial risk of losing this profit. Similarly, with a constant financial leverage ratio

the positive or negative dynamics of its differential can generate both an increase in the amount and level of return on equity, and the financial risk of its loss.

Knowledge of the mechanism of the impact of financial leverage on the level of return on equity and the level of financial risk allows you to purposefully manage both the cost and the capital structure of the enterprise.

The mechanism of financial leverage is used most effectively in the process of optimizing the capital structure of an enterprise. The optimal capital structure is such a ratio of the use of own and borrowed funds, which ensures the most effective proportionality between the financial profitability ratio and the financial stability ratio of the enterprise, i.e., its market value is maximized.

Bibliography

1. Blank, I. A. Financial strategy of the enterprise / I. A. Blank. Kyiv: Elga, Nika-Center, 2004. 720 p.

2. Lisitsa, M. I. Review of models of the theory of capital structure and analysis of their solvency / M. I. Lisitsa // Finance and credit. 2007. No. 9. S. 48-55.

3. Perevozchikov, A. G. Determining the structure of capital based on sectoral indicators from financial statistics collections / A. G. Perevozchikov // Finance and credit. 2006. No. 8. S. 16-18.

4. Stanislavchik, E. Ensuring financial balance as a company management tactic / E. Stanislavchik, N. Shumskaya // Problems of theory and practice upr. 2006. No. 12. S. 43-51.

5. Sysoeva, E. F. Comparative analysis of approaches to the problem of optimizing the capital structure / E. F. Sysoeva // Finance and credit. 2007. No. 25. S. 55-59.

6. Sysoeva, E. F. Capital structure and financial stability of the organization: a practical aspect / E. F. Sysoeva // Finance and credit. 2007. No. 22. S. 24-29.

7. Sysoeva, E. F. Financial resources and capital of the organization: a reproduction approach / E. F. Sysoeva // Finance and credit. 2007. No. 21. S. 6-11.

In the article we will analyze the ratio of the structure of borrowed capital. This indicator is used to assess the financial stability of a business.

Debt capital structure ratio. Balance calculation formula

Debt structure ratio- an indicator that reflects the financial stability of the enterprise and characterizes the share of long-term liabilities in the structure of borrowed capital.

The formula for calculating the debt capital structure ratio according to the balance sheet is as follows:

The larger the share of long-term liabilities in the structure of borrowed capital, the more non-current assets of the enterprise are financed: facilities, equipment, buildings, etc. Conversely, a decrease in the ratio indicates an increase in the cost of current assets that support the current activities of the company. In other words, the structure of borrowed capital allows you to determine the company's policy for financing non-current or current assets. Assessment of the current financial condition should be carried out comprehensively for all financial stability ratios. Read more in the article: ““. This indicator is also used in assessing the financial reliability of a startup according to the developed business plan.

Standard value coefficient of the structure of borrowed capital. Analysis

There is no single recommended standard value of the debt capital structure ratio. Analysis of the dynamics allows you to evaluate the strategy of managing debt capital and determine the direction of development of the enterprise.

As indicated in a number of works, it is possible to analyze the capital structure using the following indicators:

1. Coefficient of autonomy (concentration of own capital)

The coefficient is calculated according to the following formula (1):

This coefficient shows the share of own funds in the total amount of funding sources.

This value of the equity concentration ratio gives grounds to assume that all liabilities can be covered by its own funds. An increase in this indicator reveals to a greater extent independence from financial investments of third parties. At the same time, a decrease in this ratio signals a weakening of financial stability. Therefore, the higher this coefficient, the more reliable the financial position of the enterprise looks for banks and creditors.

2. The coefficient of attraction of borrowed capital.

This ratio shows the share of borrowed funds in the total amount of funding sources.

The coefficient characterizes the degree of dependence of the company on borrowed funds. It shows how much borrowed funds account for one ruble of own assets and is calculated using formula (2):

Accordingly, the value of this indicator should be less than 0.5. The higher this ratio, the more loans the company has and the more risky the situation, which can ultimately lead to the insolvency of the enterprise.

3. Non-current assets coverage ratio

This ratio reflects the extent to which non-current assets of the enterprise are financed by equity and long-term borrowed capital. Calculated as (3):

4. Interest coverage ratio (protection of creditors

It characterizes the degree of protection of creditors from non-payment of interest and shows how many times during the year the company earned funds to pay interest on loans and is defined as (4):

A ratio value above 1.0 means that the company has enough profit to pay interest on loans, i.e. creditors are protected.

5. The coefficient of coverage of assets by own working capital.

The coefficient shows the share of own working capital (net working capital) in the total amount of funding sources and is determined by the formula (5):

• 6. Long-term solvency ratio

This ratio characterizes the ability to repay long-term loans and the ability of the organization to operate for a long time. An increase in the share of borrowed capital of an organization in the capital structure is considered risky, since it is obliged to pay interest on loans and repay loans received in a timely manner. The higher the value of this coefficient, the greater the debt of the organization and the lower the assessment of the level of its long-term solvency.

Calculated using the following formula (6):

• 7. Return on equity.

The ROE ratio is the most important for assessing the investment attractiveness of a company in the long term. It shows how much profit each ruble invested in the company's business by its owners brings. Calculated by formula (7):

ROE = Net Income / Equity (7)

These indicators allow you to find out the share of own funds in the total amount of capital, the share of borrowed funds in the total amount of capital, the solvency of the enterprise in the long term, the degree of protection of creditors from non-payment of interest, the share of working capital in the total amount of capital, the efficiency of using available resources.

The long-term solvency ratio shows the ability to repay the long-term obligations of the enterprise and the ability of the organization to function for a long time.

The price of the capital of an economic entity largely depends on its structure.
The capital structure of an enterprise (Fig. 55) is the ratio between various sources of capital (own and borrowed capital) used to finance its activities. Sometimes short-term borrowings are excluded from capital, that is, the capital structure is defined as a set of sources used for long-term financing of the investment activity of an enterprise. At the same time, if short-term borrowings are carried out on an ongoing basis (which in most cases happens), they, in our opinion, should be included in capital when analyzing the financing structure.

Rice. 55. Basic definition of the capital structure of an enterprise
The optimal capital structure is the combination of debt and equity that maximizes the total value of the firm.
If we approach the issue of determining the optimal capital structure in terms of the relative cost of funding sources, then it must be taken into account that debt obligations are cheaper than shares. This means that the price of borrowed capital is on average lower than the price of equity capital. It follows that the replacement of shares with cheaper borrowed capital reduces the weighted average cost of capital, which leads to an increase in the efficiency of entrepreneurial activity and, consequently, to the maximization of the enterprise price. Therefore, a number of financial management theories are based on the conclusion that the optimal capital structure involves the use of borrowed capital to the maximum extent possible.
But in practice, one should proceed from the fact that the replacement of shares with cheaper borrowed capital reduces the value of the firm, which is determined by the market value of the equity of this firm.
In addition, the increase in debt increases the risk of bankruptcy, which can significantly affect the price that potential investors are willing to pay for the company's common stock.
There are also important non-financial costs associated with the use of debt capital as a result of the limited discretion of managers in loan agreements. These may be obligations to create additional reserve funds to pay off debt or restrictive conditions in declaring dividends, which undoubtedly reduce the value of the business.
Therefore, it is impossible to develop a formula for determining the optimal capital structure for a particular enterprise. The manager, determining how close the capital structure of the company is to the optimal one, must rely to a certain extent on intuition, which in turn is based on information that takes into account both intra-company and macroeconomic factors.
In addition, attracting financial resources from various sources has organizational, legal, macroeconomic and investment restrictions.
Restrictions of an organizational and legal nature include statutory requirements for the amount and procedure for the formation of individual elements of equity and borrowed capital, as well as control over the management of the company by the owners.
The macroeconomic constraints include the investment climate in the country, country risk, emission and credit policy of the state, the current taxation system, the value of the Central Bank refinancing rate, and the inflation rate.
The amount of financial resources that a company can attract from various sources, and the period for which they can be involved in business turnover, depends both on the development of the financial and credit markets, and on the availability of these funds for a particular enterprise. One of the important restrictions on the formation of the financial structure of capital is the compliance of the scope and nature of the enterprise's activities with the investment preferences of shareholders and / or the degree of trust in the enterprise on the part of creditors.
Thus, no theory can provide a comprehensive approach to solving the problem of the optimal capital structure of an enterprise. Therefore, in practice, the formation of an economically rational capital structure is based on one of the following principles:
1. The principle of maximizing the level of projected return on capital.
2. The principle of minimizing the cost of capital.
3. The principle of minimizing the level of financial risks.
At the same time, there are a number of financial instruments that can be used to improve the efficiency of managing the financial structure of an enterprise's capital. Among them is the use of financial ratios, which can be used to assess the impact of the process of changing the financial structure of capital on the financial position of the enterprise and the degree of protection of the interests of creditors and investors. We are talking about indicators characterizing the financial stability of the enterprise and the efficiency of investments in it (Fig. 56).

Rice. 56. The concept of financial stability of an economic entity
and the formula for calculating the financial stability ratio
Achieving the financial stability of an enterprise, along with increasing profits and limiting risk, requires the enterprise to maintain both solvency, or liquidity (the financial meaning of this concept was discussed in detail in topic 6), and creditworthiness, which is by no means synonymous with the concept of "solvency".
The creditworthiness of an enterprise is understood as the presence of prerequisites for obtaining a loan and repaying it on time. The creditworthiness of the borrower is characterized by its diligence in the settlement of previously received loans, the current financial condition and the ability, if necessary, to mobilize funds from various sources.
The financial stability ratio characterizes the ratio of own and borrowed sources of financing. If this indicator is higher than one (there is an excess of own funds over borrowed funds), this means that the enterprise has a sufficient margin of financial stability.
The coefficient of financial dependence (Fig. 57) characterizes the dependence of the enterprise on external loans and shows what share of the company's property was acquired at the expense of borrowed funds. The higher this ratio, the more risky the situation in financial stability and the greater the likelihood of a shortage of funds.

Rice. 57. Formulas for calculating the coefficients of financial dependence, provision with own funds and self-financing
The equity ratio characterizes the ability of an enterprise to meet the need for working capital financing only from its own sources. The financial condition of the enterprise is considered satisfactory if this indicator is equal to or greater than 0.1.
The self-financing ratio shows what part of the investment can be covered from the internal sources of the enterprise - retained earnings and accrued depreciation. A number of authors consider the amount of retained earnings and depreciation as a net cash flow, or cash flow from the economic activity of the enterprise. Then the coefficient of self-financing has the name "indicator of monetary return on investment". The higher this indicator, the higher the level of self-financing of the enterprise, therefore, the higher the financial stability.
The coefficient of autonomy (concentration of own capital) characterizes the share of own capital in the financial structure of capital (Fig. 58). For greater financial stability, it is desirable that it be at the level of 0.5-0.6.

Rice. 58. The formula for calculating the coefficient of autonomy (concentration of equity)
A number of authors attribute the autonomy coefficient to indicators of liquidity, which seems to us quite logical, since an enterprise should first of all pay for its obligations from its own sources. At the same time, this indicator is also an important coefficient in assessing the financial structure of an enterprise.
To ensure full financial stability, the management of the enterprise, along with ensuring sufficient solvency and creditworthiness, is obliged to maintain high liquidity of the balance sheet, and for this, the financial structure of the capital should be formed taking into account the following requirements:

Accounts payable should not exceed the value of the most liquid assets of the enterprise (these include primarily cash and short-term securities);

Short-term loans and borrowings and that part of long-term loans, the maturity of which falls within a given period, should not exceed the value of marketable assets (accounts receivable, funds on deposits);

Long-term credits and loans should not exceed the value of slow-moving current assets (stocks of finished products, raw materials and materials);

Own funds must be higher than the value of non-current assets of the enterprise.

Considering the financial structure of the enterprise's capital, it is necessary to analyze its ability to service fixed payments - interest on borrowed capital and dividends to owners of equity capital. For such an assessment, indicators of market activity, or the effectiveness of investments, are used.
The interest coverage ratio (Fig. 59) characterizes the degree of protection of creditors from non-payment of interest for a loan. Although there is no hard and fast rule of thumb regarding the optimal value of interest and dividend coverage ratios, most analysts agree that the minimum value of this ratio should be 3. A decrease in this ratio indicates an increase in financial risk.

Rice. 59. Formula for calculating interest coverage ratio
Using the dividend coverage ratio for preferred shares (Fig. 60), one can assess the company's ability to service dividend debt to holders of preferred shares. In this case, the numerator of the formula is the amount of net profit, because Dividends are paid out of profit after tax only. Obviously, the closer this indicator is to one, the worse the financial position of the company.

Rice. 60. Formula for calculating the dividend coverage ratio for preferred shares
Income per ordinary share (Fig. 61) is the main indicator of the enterprise's market activity. It characterizes the ability of the stock to generate income. It is determined by the ratio of net profit, reduced by the amount of dividends on preferred shares, to the number of ordinary shares of the company.
Dividend coverage ratio (Figure 62) estimates the amount of profit that can be used to pay declared dividends on ordinary shares. The reciprocal of this ratio is the dividend payout ratio, which is equal to the ratio of the amount of accrued dividend to income per ordinary share and shows what proportion of the company's net profit is directed to pay dividends.
The income capitalization interest rate (Figure 63) reflects the return on invested capital and the cost of equity capital on ordinary shares. The financial essence of this indicator is that it can be viewed as the rate at which the market capitalizes the amount of current income.

Rice. 61. Formula for calculating earnings per ordinary share

Rice. 62. The formula for calculating the dividend coverage ratio for ordinary shares circumstances.
So, above we considered that for the financial stability of an enterprise, a high share of equity capital is necessary. At the same time, if a company uses borrowed funds to an insufficient extent and is limited to using its own capital, this is fraught with a slowdown in development, a drop in competitiveness, physical and moral obsolescence of equipment, and a discrepancy between the characteristics of finished products and market requirements. All this leads to a decrease in gross profit, and therefore, earnings per share, a decrease in the market value of shares and, as a result, a decrease in the market value of the company. At the same time, an extremely high proportion of borrowed funds in liabilities indicates an increased risk of bankruptcy. In addition, loan holders may take control of a firm with limited self-financing capability.

Rice. 63. Formula for calculating the interest rate of income capitalization
Most often, financial ratios are just a hint of what is happening in the enterprise, what changes and trends, how they affect business development. Financial indicators help to get answers to the most important questions related to the current and strategic activities of the enterprise, such as:
- What is more important at this stage of the company's activity - high profitability or high liquidity?
-What is the optimal value of a short-term loan required by an enterprise?
-What part of the profit to distribute as dividends?
- Conduct a new issue of shares or attract borrowed capital? etc.
Ultimately, when making any decision related to the management of the financial structure of capital, one should remember one of the main goals of financial management - maximizing the company's profits.
It is possible to influence the profitability of an enterprise by changing the volume and structure of liabilities.
Consider, for example, the performance of four firms that are the same in everything except the size and cost of borrowed capital.
So, firm Ane uses borrowed capital, firm B has a loan at 8%, firm C - at 12%, firm D - at 16%. The return on investment (ROI) of each firm is 12%. The nominal value of shares is 10 rubles, income tax is 20%.

Despite the fact that all firms have the same volume and return on investment, firm B will provide its shareholders with a higher return on shares than firm A, which does not use debt capital at all. The return on shares of firms A and C, despite the different capital structure, is the same. The shareholders of firm D will receive the least return on shares. The result is due to two reasons:
1) since interest on the loan is deducted from income, usually before taxes, debt financing reduces taxable profits and leaves a large amount of income at the disposal of the shareholders of the company;
2) the company can, with the effective use of borrowed capital, have additional income, which, after paying interest to investors, can be distributed among shareholders.
To do this, the amount of return on invested capital (DAYS) must be higher than the interest that the company pays for the use of borrowed capital.
So, firm B, paying a loan at 8%, ensures the profitability of its use at 12%, which increases the profitability of its shares compared to firm A. In this case, we are talking about a positive effect of financial leverage (Fig. 64). Firm A's DAYs coincide with the debt scene, so its earnings per share are equal to Firm A's earnings per share. The effect of financial leverage is zero. Firm D, paying a loan at 16% and having DAYS equal to 12%, is exposed to the negative effect of financial leverage.

Rice. 64. The concept of financial leverage
From the formula for calculating the level of the effect of financial leverage (Fig. 65), it can be seen that the positive, negative or zero value of the effect of financial leverage depends on the difference between the economic profitability of assets (ER) and the average calculated interest rate (AMIR) (the so-called financial leverage differential). If ER>SRSP, then both the differential and the effect of financial leverage are positive; if ER< СРСП - отрицательный; если ЭР = СРСП - нулевой.
The level of the effect of financial leverage also depends on the ratio of borrowed and own funds of the enterprise (the so-called shoulder of financial leverage). If the amount of borrowed funds is higher than the amount of equity capital, the force of the impact of financial leverage increases, if it is lower, it falls.
It affects the level of the effect of financial leverage and the rate of taxation of profits, and the lower it is, the greater the impact of the effect of financial leverage.
When determining the optimal amount of borrowed capital that can be attracted by an enterprise to finance its economic activities, it must be taken into account that not only profitability, but also financial risk depends on the capital structure.
In this case, financial risk is considered as a deviation of the actual result from the planned one.

Rice. 65. Formula for calculating the level of effect of financial leverage
An illustration of the influence of borrowed capital on the risk and profitability of entrepreneurial activity can be the following example. Firms A and V have the same assets (100 thousand rubles), sales volume (100 thousand rubles) and operating expenses (70 thousand rubles). Only the capital structure is different - firm A is financed only at the expense of its own capital (100 thousand rubles), firm B - at the expense of its own (50 thousand rubles) and borrowed (50 thousand rubles at 15%) capital.

Thus, under normal conditions, firm B will provide its shareholders with a return on shares of one and a half times the return on the shares of firm A. However, under unfavorable conditions, where sales are lower and costs are higher than expected, the return on equity of the firm , exposed to financial leverage, will fall especially sharply, there will be losses. Firm A, due to a more stable balance sheet, will be able to more easily endure the decline in production.
It follows that firms with a low share of debt are less risky, but they are deprived of the opportunity to use the positive effect of financial leverage to increase the return on equity. Firms that are relatively leveraged may have a higher return on equity if economic conditions are favorable, but they are at risk of loss if they find themselves in a downturn or if the financial calculations of the firm's managers do not pan out. At the same time, it should be taken into account that if only a small part of the investments is made by the owners, then the risks of the enterprise are mainly borne by creditors.
Summarizing the above, we note that the capital structure of an enterprise should provide the most effective ratio between indicators of profitability and financial stability. To solve this one of the most difficult tasks of financial management, the process of optimizing the capital structure of an economic entity should include several stages:
1. Analysis of capital in order to identify trends in the dynamics of the volume and composition of capital and their impact on the efficiency of the use of funds and the financial stability of the company.
2.Evaluation of the main factors influencing the capital structure.
3. Optimization of the capital structure according to the criterion of maximizing the return on equity with a simultaneous assessment of the amount of financial risk and the effect of financial leverage.
4. Optimization of the capital structure according to the criterion of minimizing its cost, for which the price of each element of capital is determined and its weighted average cost is calculated based on multivariate calculations.
5. Differentiation of sources of financing according to the criterion of minimizing the level of financial risks.
6.Formation of the target capital structure, which is the most profitable and least risky.
After that, work can begin to attract financial resources and relevant sources.
EXERCISES
10.1. Based on the data of the company's financial statements given in task 6.1, determine the indicators of financial stability and market activity of this company.
10.2. Determine the level of effect of financial leverage, if given:
Sales proceeds - 1 million 500 thousand rubles.
Variable costs - 1 million 050 thousand rubles.
Fixed costs - 300 thousand rubles.
Long-term loans - 150 thousand rubles.
Short-term loans - 60 thousand rubles.
Average calculated interest rate - 25%
Own funds - 600 thousand rubles.
Conditional income tax rate - 1/5
10.3. Find the level of effect of financial leverage, if given:
Sales - 230,000 units at a selling price per unit of 17 rubles,
Fixed costs - 310,000 rubles,
Variable costs per unit - 12 rubles,
Debt - 420,000 rubles at 11% per annum on average,
Share capital - 25,000 ordinary shares at a price of 60 rubles per share.

Is financial leverage favorable and why? Suppose another firm has the same stock value, DAYS, total assets as this firm, and has no borrowings. Which firm has the highest earnings per share?
10.4. Determine the level of effect of financial leverage, if given:
Sales volume - 9.25 million rubles.
Operating expenses - 8.5 million rubles.
Debt - 6 million rubles. at 15% per annum.
Share capital - 7.2 million rubles.
The income tax rate is 24%.
Is financial leverage favorable? At what price of borrowed capital will the impact of the effect of financial leverage be equal to zero?
10.5. Mini-case "Financial alternatives"
Friday, 15.00. Vladislav Mamleev is finishing the weekly report in the office of the IVNV investment firm. Stanislav Burobin, partner of the firm, has been on a business trip for a week now. He traveled around the area, visiting potential clients of the firm and offering to invest their free funds with the help of "IVNV". On Wednesday, he called and told Vladislav's secretary that he would fax his recommendations on Friday. The secretary just brought this fax. It should include recommendations on investments in securities for three of the firm's clients. Vladislav should call these clients and offer it for consideration.
Fax text: “To Vladislav Mamleev. IVNV. I was offered to go skiing for the weekend. I'll be back Wednesday.
My recommendations: (1) common stock; (2) preferred shares; (3)Swarrant bonds; (4) convertible bonds; (5) revocable debentures. Stas.
Vladislav picks up the phone to call clients. Suddenly the thought occurs to him that the proposals do not meet the investment needs of the client. He finds files in the closet for each of the three clients. They contain brief references compiled by Stanislav. He reads these references:
MTV company. Needs 8 million rubles now and 4 million for the next four years annually. Fast growing packaging company in three regions. Ordinary shares are sold through brokerage houses. The firm's shares are undervalued but should rise in the next 18 months. Ready to issue securities of any type. Good management. Moderate growth is expected. New machines should significantly increase profitability. Recently paid off a debt of 7 million rubles. Has no debts, except for short-term ones.
Firm "Stroganov Plants". Needs 15 million rubles. Outdated management. Stocks are low but growth is expected. Excellent forecast for growth and profitability next year. Low leverage-to-equity ratio, the firm tries to buy back debt before maturity. Holds most of the profits by paying small dividends. Management does not want to allow outsiders to control and vote. Money is needed to purchase equipment for the production of sanitary equipment.
Firm "Brothers Demidov". Needs 25 million rubles to expand furniture production. The firm started as a family business, now has 1300 employees, 45 million in sales and sells its shares through brokerage houses. Looking for new shareholders, but does not want to sell his shares on the cheap. Direct borrowed capacity is not more than 10 million rubles. Kind management. Good growth prospects. Very good income. Should ignite the interest of investors. The bank willingly lends to the company in the short term.
After reading these certificates, Vladislav asked Stanislav's secretary if he had left any other materials on these firms. Answer: “I didn’t leave it, but this morning I called and asked to confirm that the information in the clients’ files is reliable and personally verified by them.”
Vladislav considered the situation. You can, of course, postpone the decision until next week. But there are still two hours today, and if you think about it, that's enough time to make the offer more precise: which securities to recommend to each of the clients specifically in particular. Decided: I will make more reasoned proposals and call the clients, as promised, today.
Question (for small group work): What is the best funding profile for each client?
CONTROL TESTS
1. Capital structure is:
1) the ratio between different sources of capital
2) the ratio of debt obligations to the total assets
3) the ratio of the cost of ordinary and preferred shares of the enterprise
2. The level of effect of financial leverage:
1) always positive
2) always negative
3) can be both positive and negative
4) is always zero
3. Indicate the standard of the equity ratio:
1) ≥ 1,0
2) ≥ 0,1
3) ≥ 0,5
4. If the amount of borrowed funds becomes higher than the amount of the company's own capital, the strength of the financial leverage:
1) is increasing
2) falls
3) remains unchanged
5. Financial leverage differential is:
1) the difference between the cost of own and borrowed capital of the enterprise
2) the difference between the economic return on assets and the average calculated interest rate
3) the difference between income received and expenses incurred for the reporting period
6.Financial stability of the enterprise:
1) depends on the ratio of own and borrowed sources of financing
2) depends on the price of borrowed sources of financing
3) depends on the ratio of working and non-working capital
7. To determine the share of equity capital in the financial structure of capital, the indicator is used:
1) Funding ratio
2) financial stability ratio
3) agility factor
4) autonomy coefficient
8. To assess the ability to service interest on borrowed capital, the following are used:
1) indicators of market activity
2) indicators of business activity
3) indicators of financial activity