Efficiency of using working capital. Production and financial cycles

Effective use working capital has an active influence on the progress of production, financial results and financial condition enterprises. The released material and monetary resources are additional internal source further investments contribute to increasing the financial stability of the enterprise and its solvency. Under these conditions, the company fulfills its obligations in a timely manner and in full.
The efficiency of using working capital is characterized by a system of indicators:
Own working capital (own working capital) - characterizes that part current assets, which is financed from its own funds or long-term liabilities.

SOK = Current assets - Current liabilities,

where SOK is own working capital;
JUICE must be gt; 0.

Availability of own working capital - necessary condition ensuring the financial stability of the enterprise. It is recommended to set the minimum value of this indicator at 10% of the total volume of current assets.
The higher this indicator, the more stable the financial condition of the enterprise, the more opportunities it has to pursue an independent financial policy. However, having a ratio that is too high (more than 50% of current assets) is not very good, since the company uses funds inefficiently.
Working capital turnover is the duration of one complete circulation of funds, from the acquisition of inventories to sales. finished products and receipt of money to the company's current account.
The faster working capital goes through these phases, the more products an enterprise can produce using the same amount of working capital. Turnover depends on the specifics of production and sales conditions, features in the structure of working capital and other factors.
The turnover rate of working capital is calculated using the following indicators:
2.1. Turnover speed (turnover ratio) - the number of revolutions that working capital and its individual elements make during the analyzed period.
The turnover ratio is calculated using the following formula:

Ko = B / Sob,

where Ko is the turnover ratio of current assets;
B - revenue from sales of products;
Sov - average value of current assets for the analyzed period = (current assets at the beginning of the period + current assets at the end of the period) / 2.

2.2. The load factor of current assets is an indicator inverse to the turnover ratio. It shows how much working capital is per 1 ruble. revenue from product sales. The load factor is calculated using the following formula:

Kzos = 1 / Ko, or Kzos = Sob / B,

where Kzos is the load factor of current assets;

Ko - turnover ratio of current assets;

2.3. Turnover period (the duration of one turnover of working capital) is the average period during which money invested in production and business operations is returned.
The duration of one turnover of working capital is calculated by the formula:

Ext = T? Sob/V,

where Dob is the duration of one turnover of current assets, in days;
T - number of days in the analyzed period (year - 360 (365) days, quarter - 90 days);
Sov - the average value of current assets for the analyzed period;
B - revenue from sales of products.

There are general and private turnover.

General turnover characterizes the intensity of use of working capital in all phases of the circulation, without reflecting the characteristics of the circulation of individual elements or groups of working capital.
Partial turnover reflects the degree of use of working capital in each individual phase of the circulation, in each group, as well as for individual elements of working capital (inventory turnover, accounts receivable turnover, etc.).
The faster working capital circulates, the better and more efficiently they are used. Acceleration of turnover leads to the release of part of working capital (material resources, cash), which can be used by the enterprise for further expansion of production, development of new types of products, improvement of supply and sales and other improvement measures entrepreneurial activity.
The relative release of working capital is the difference between the organization's working capital requirement, calculated on the basis of the planned or actually achieved turnover in the reporting year, and the amount with which the organization ensured the implementation of the production program in the next year.
The relative release of working capital as a result of a change in the duration of one revolution is determined as follows:

Vos = (Dobf - Dobbaz) ? Vf,

where Dobf is the turnover period of working capital in the reporting period, in days;
Dobbaz - the period of turnover of working capital in the base (previous) period, in days;
Vf - average daily revenue from product sales in the reporting period.

Relative release of working capital = (Dobf - Dobbaz) ? Vf = (22.5 - 25.7) ? 24 million / 360 days = -213,333 rub.

The turnover of working capital may accelerate or slow down. When turnover slows down, additional funds are involved in turnover. The effect of accelerating turnover is expressed in a reduction in the need for working capital due to improved use and savings, which affects the increase in production volumes and, as a consequence, financial results.
Factors that contribute to increasing the efficiency of using working capital include:
increase in production and sales volumes;
rational organization of production reserves (resource conservation, optimal rationing, improvement of the supply of raw materials);
reducing the presence of working capital in work in progress (overcoming the negative trend towards a decrease in capital productivity, accelerating technological process, implementation latest technologies);
effective organization of circulation (improvement of the payment system, rational organization of sales, systematic control of receivables).

More on topic 9.2. Indicators of efficiency in the use of working capital:

Topic 2. FIXED CAPITAL AND THE EFFECTIVENESS OF ITS USE. WORKING CAPITAL AND THE EFFECTIVENESS OF ITS USE

The need for analysis and evaluation working capital creditor bank

In general, we can say that current assets serve the current activities of the enterprise, and the entire operating cycle, uninterrupted operation and continuity of the enterprise depend on their condition. Therefore, analysis of changes in the structure of current assets is mandatory stage assessing the solvency of the borrowing enterprise.

The need to analyze the working capital of the borrower enterprise is due to the fact that this type assets primarily ensure the solvency of the enterprise. Problems in managing the borrower's working capital lead to the following risks, which should be known to the creditor bank:

Insufficient funds. The enterprise must have funds to conduct current activities, in case of unforeseen expenses and in case of likely effective capital investments. Lack of funds in right moment is associated with the risk of interruption of the production process, possible failure to fulfill obligations, or loss of possible additional profits.

Insufficient own credit capabilities. This risk is due to the fact that when selling goods on credit, buyers can pay for them within several days or even months, resulting in the formation of receivables at the enterprise. As a result, there is an immobilization of one's own working capital, and if it exceeds a certain limit, it can also lead to a loss of liquidity and even a stoppage of production.

Insufficient industrial reserves. The enterprise must have a sufficient amount of raw materials to carry out efficient process production; there should be enough finished products to fulfill all orders, etc. Sub-optimal inventory levels carry the risk of additional costs or production interruption.

Excessive working capital. Since its value is directly related to financing costs, maintaining excess assets reduces income. Possible various reasons formation of excess assets: slow-moving and stale goods, the habit of “keeping in reserve”, etc.

After conducting the analysis, the lending bank must take into account that the most significant phenomenon that potentially carries the risk of the borrower’s inability to service the loan received is the following:

High level of accounts payable;

Suboptimal combination between short-term and long-term sources of borrowed funds;

High share of long-term debt capital.

Analysis of the efficiency of using working capital of business entities

The efficiency of using working capital is characterized by the following system of economic indicators:

Working capital turnover;

Load factor of funds in circulation;

Return on working capital indicator;

Liquidity ratios;

Return on current assets;

Calculation of the degree of financial stability depending on the degree of provision of reserves and costs various types sources;

General analysis of the state of the enterprise's working capital.

Considering the turnover of working capital, it should be noted that financial situation of an enterprise directly depends on how quickly funds invested in assets are converted into real money, that is, on the turnover of working capital.

The duration of one turnover of working capital is calculated by the formula:

where О – duration of turnover, days;

C – working capital balances (average or as of a specific date), rub.;

T – volume of commercial products, rub.;

D – number of days in the period under review, days.

A decrease in the duration of one revolution indicates an improvement in the use of working capital.

The number of turnovers for a certain period, or the working capital turnover ratio (K O), is calculated by the formula:

In addition to these indicators, the return on working capital indicator can also be used, which is determined by the ratio of profit from sales of the enterprise's products to the balance of working capital.

To assess solvency in the short term, the following indicators are calculated:

Coverage ratio (total). Gives overall rating asset liquidity, showing how many rubles of the enterprise’s current assets account for one ruble of current liabilities. The logic for calculating this indicator is that the company repays short-term liabilities mainly at the expense of current assets; therefore, if current assets exceed current liabilities, the enterprise can be considered to be operating successfully (at least in theory). The size of the excess is set by the coverage coefficient.

where A1 is the most liquid assets - the company’s cash and;

A2 – quickly realizable assets – accounts receivable and other assets;

A3 - slow-moving assets - inventories (without expenses of future periods of the balance sheet of Form No. 1), as well as items from section I of the balance sheet asset “Long-term financial investments” (reduced by the amount of investments in the authorized capital of other enterprises);

P1 - the most urgent obligations - accounts payable, other liabilities, as well as loans not repaid on time;

P2 – short-term liabilities – short-term loans and borrowed funds.

The value of the indicator can vary significantly by industry and type of activity, and its reasonable growth in dynamics is usually considered as a favorable trend. In Western accounting and analytical practice, the critical lower value of the indicator is given - 2; however, this is only an indicative value, indicating the order of the indicator, but not its exact normative value.

If the coverage ratio is high, then this may be due to a slowdown in the turnover of funds invested in inventories and an unjustified increase in accounts receivable.

A constant decrease in the ratio means an increasing risk of insolvency. It is advisable to compare this indicator with the average values for groups of similar enterprises.

However, this indicator is very aggregated, since it does not take into account the degree of liquidity of individual elements of working capital.

The quick liquidity ratio (strict liquidity) is an intermediate coverage ratio and shows what part of current assets minus inventories and receivables, payments for which are expected more than 12 months after the reporting date, is covered by current liabilities.

The quick liquidity ratio is calculated using the formula:

It helps to assess the company's ability to repay short-term obligations in the event of a critical situation when it is not possible to sell inventories. This indicator is recommended in the range from 0.8 to 1.0, but can be extremely high due to an unjustified increase in accounts receivable.

The absolute liquidity ratio is determined by the ratio of the most liquid assets to current liabilities and is calculated using the formula:

This ratio is the most stringent criterion of solvency and shows what part of the short-term debt the company can repay in the near future. Its value should be no lower than 0.2. If a company can currently repay its debts by 20–25%, then its solvency is considered normal.

The equity ratio characterizes that part equity enterprise, which is the source of covering the current assets of the enterprise (that is, assets with a turnover of less than one year). This is a calculated indicator that depends both on the structure of assets and on the structure of sources of funds.

The indicator is especially important for enterprises engaged in commercial activities and other intermediary operations. Other than that equal conditions the growth of this indicator over time is considered a positive trend.

The main and constant source of increasing own working capital is profit. Return on current assets shows how many rubles of net profit are per 1 ruble of current assets.

Return on current assets is calculated using the following formula:

where RTA is the return on current assets,

PE – net profit of the enterprise,

АII, – the average value of section II of the enterprise’s balance sheet – current assets.

The most general indicator of the financial stability of an enterprise is the surplus or lack of sources of funds for the formation of reserves and costs. This surplus or deficiency is formed as a result of the difference in the size of sources of funds and the amount of inventories and costs.

Availability of own working capital E C. This indicator is calculated using the following formula:

E C = K + P D - A B

where K – capital and reserves;

P D – long-term loans and borrowings;

A B – non-current assets.

The total value of the main sources of formation of reserves and costs E O.

E O = E C + M

where M – short-term loans and borrowings.

Based on the above indicators, indicators of the provision of reserves and costs with sources of their formation are calculated.

Surplus (+) or deficiency (-) of own working capital ±E C:

±E C = E C – W

where Z – reserves.

Excess (+) or deficiency (-) of the total value of the main sources for the formation of reserves and costs ±E O:

±E O = E O – W

According to the degree of financial stability of the enterprise, four types of situations are possible:

Absolute stability of financial condition. This situation is possible under the following conditions:

Z< Е С + М

Normal stability of financial condition, guaranteeing the solvency of the enterprise. It is possible provided:

An unstable financial situation is associated with a violation of solvency and occurs under the condition of:

Z = E C + M + I O

where I O are sources that ease financial tension (temporarily available own funds, borrowed funds, bank loans for temporary replenishment of working capital and other borrowed funds).

Crisis financial condition:

W > E S + M

It is proposed to carry out a general analysis of the state of the enterprise's working capital by summing up the assessment indicators into a single table, where each indicator is assigned its own score and their sum rating is determined. Next, the deviation of the obtained score from the maximum is determined. possible meaning, and appropriate conclusions are drawn (Table 1) .

Indicator name	Minimum value	Average value	Maximum value
Indicator name	meaning	meaning	Meaning


2. Current liquidity
3. Urgent liquidity
4. Absolute liquidity

Interesting are the approaches to assessing working capital, proposed in the work of L.Yu. Filobokova

- (K1, weight value 8);

Coefficient of provision with own working capital (K2, weight value 8);

Absolute liquidity ratio (K3, weight value 7);

Working capital mobility coefficient (K4, weight value 7);

Share of real net working capital in current assets (K5, weight value 6);

Return on working capital (K6, weight value 3);

Working capital turnover ratio (K7, weight value 5);

Inventory turnover ratio (K8, weight value 1-3);

Accounts receivable turnover ratio (K9, weight value 1-3);

Profitability of pure cash flow(K10, weight value 9).

An integrated indicator assessing working capital is calculated using the formula

Where K are weighting coefficients, Xij is the ratio of the value of a particular indicator to its maximum value for the total set of enterprises under study.

T.B. Kupriyanova, in her dissertation devoted to the development of recommendations for working capital management, also suggests using an integral indicator, the coefficients for calculating which are presented below:

Working capital turnover ratio (weight value 20);

Current ratio (weight value 20);

Own funds maneuverability coefficient (weight value 15);

Coefficient of provision of current assets with own working capital (weight value 10);

Accounts payable turnover ratio (weight value 10);

Debt to equity ratio (weight value 10);

Return on working capital ratio (weight value 10).

Analysis of working capital statusJSC "Enterprise A"

We will analyze the working capital of OJSC "Enterprise A" using the above methodological approaches ( table 2) .

Table 2. Analysis of changes in the working capital of the branchJSC "Enterprise A"

Title of articles
Title of articles


including:

finished products and goods for resale
deferred expenses




including buyers and customers
Short-term financial investments
Cash
Other current assets
TOTAL for section II

As we can see, during the analyzed period, the volume of working capital of JSC Enterprise A increased by 534,205 thousand rubles.

There was an increase in the following items as part of working capital:

Cash – by 981,404 thousand rubles;

Other current assets – by 44,232 thousand rubles.

There was a decrease in other items.

An analysis of the working capital structure of the branch of OJSC "Enterprise A" is presented in table 3 .

Table 3.Analysis of the working capital structure of JSC "Enterprise A"

Title of articles
Title of articles


including:
raw materials, supplies and other similar assets
deferred expenses
Value added tax on purchased assets
Accounts receivable (payments for which are expected more than 12 months after the reporting date)
including buyers and customers
Accounts receivable (payments for which are expected within 12 months after the reporting date)
including buyers and customers
Short-term financial investments
Cash
Other current assets
TOTAL for section II

The highest share in the structure of working capital belongs to short-term receivables – 49.87% in 2011. It should be noted that compared to 2009, the share of this item decreased by 9.48%.

During the analyzed period, there was a slight decrease in the share of reserves - from 21.75% in 2009 to 17.50% in 2011.

The share of cash increased during the analyzed period from 9.22% in 2009 to 25.74% in 2011, which indicates an increase in highly liquid items in the working capital structure of OJSC Enterprise A.

There is also an increase in the share of other current assets - from 2.74% in 2009 to 3.27% in 2011.

In general, the growth of working capital of OJSC “Enterprise A” for the analyzed period occurred due to the growth of cash and other current assets.

In order to characterize the main stages of cash circulation during production activities enterprises, we will analyze the financial and operating cycles. On Figure 1 The stages of circulation of funds of OJSC "Enterprise A" in 2011 are presented.

Figure 1. Stages of cash circulation of OJSC "Enterprise A"

1 – Receipt of raw materials; 2 – Shipment of finished products; 3 - Payment for raw materials; 4 – receiving funds from buyers

The logic of the presented scheme is as follows. The operating cycle characterizes the total time during which financial resources are stored in inventories and receivables.

The financial cycle, or cash circulation cycle, represents the time during which funds are withdrawn from circulation, that is, the financial cycle is shorter by the average time of circulation of accounts payable.

The reduction in operating and financial cycles over time is considered a positive trend. We will make calculations of these indicators in table 4.

The duration of the financial cycle is the time during which funds are withdrawn from circulation. In the branch of OJSC "Enterprise A", its duration increased over the analyzed period by 11 days - from 6 days in 2009 to 17 days in 2011, which is a negative trend, since there was an increase in the receivables turnover period.

Table 4. Analysis of the operating and financial cycles of JSC "Enterprise A"

Indicators

1. Time of circulation of accounts payable, days (line 620 f. No. 1)	Cost price
2. Time of circulation of inventories, days (line 210+220+270 f. No. 1)	Cost price
3. Time of circulation of receivables, days (line 230+240 f. No. 1)	DZsr.*365/Revenue
4. Duration of the enterprise’s operating cycle, days
5. Duration of the financial cycle of the enterprise, days

The operating cycle characterizes the time during which financial resources are immobilized in inventories and receivables. Its duration at the enterprise also increased - from 37 days in 2009 to 54 days in 2011, which can be characterized as a negative trend.

In order to assess the solvency of an enterprise and analyze the liquidity of the balance sheet, it is necessary to determine the degree to which the enterprise's liabilities are covered by assets, the period of conversion of which into cash corresponds to the period of repayment of the obligations.

Depending on the degree of liquidity, that is, the ability and speed of conversion into cash, the assets of the enterprise are divided into groups. Let's analyze the liquidity of the balance sheet of OJSC Enterprise A. To do this, we will group the assets of the balance sheet by the degree of liquidity, and the liabilities of the balance sheet by the degree of urgency of obligations in descending order, using table 5 .

Table 5. Analysis of liquidity of the balance sheet of JSC Enterprise A

	Indicator

	The most liquid assets (line 250 + line 260)
	Quickly sold assets (p. 230 + p. 240 + p. 270)
	Slowly selling assets (p. 210 + p. 220)
	Hard to sell assets (page 190)

	Current liabilities (page 620)
	Short-term loans and borrowings (line 610 + 630 + 640 +660)
	Long-term liabilities (p. 590)
	Constant liabilities (page 490 - page 252)

Let's consider the ratio of asset and liability items on the balance sheet of JSC Enterprise A for 2009–2011:

Comparison of the most liquid (A 1) and quickly realizable assets (A 2) with the most urgent liabilities (P 1) and short-term liabilities (P 2) allows you to assess current liquidity.

As we see, during the analyzed period, OJSC “Enterprise A” observed only the second inequality - the excess of quickly realizable assets over short-term liabilities, which indicates the sufficiency of quick liquidity. Since the first inequality (the excess of the most liquid assets over the most urgent liabilities) is not met, the absolute liquidity standard is not met.

Comparing slow-moving assets with long-term liabilities reflects forward-looking liquidity, which is also insufficient.

The fulfillment of the fourth inequality (the excess of permanent liabilities over permanent assets) indicates that the minimum condition for financial stability is met - the presence of the enterprise's own working capital. During the analyzed period, OJSC Enterprise A did not meet this condition.

For the most detailed analysis, we will calculate the liquidity indicators of the balance sheet of OJSC "Enterprise A" in table 6 .

Table 6. Analysis of liquidity indicators of the branch balance sheetJSC "Enterprise A"

Indicator name	Calculation formula	Standard

Current ratio
Quick ratio
Absolute liquidity ratio
The amount of own working capital	page 190 f.No.1
Maneuverability coefficient of own working capital	p. 260 / (p. 490 - p. 190) f. No. 1
Share of working capital in assets	p. 290 / p. 300 f. No. 1
Share of own working capital in working capital	(p. 490- p. 190) / p. 190
Share of inventories in working capital	(p. 210+ p. 220) / p. 290
Share of own working capital in covering inventories and costs	(page 490 - page 190) / (page 210 + page 220)

Analysis of the data presented in Table 6 showed:

The current liquidity ratio of JSC "Enterprise A" does not meet the standard in 2009 and 2011;

The quick liquidity ratio did not meet the standard in 2009 - it was below the required value by 0.15 points in 2009;

The absolute liquidity ratio was below the standard in 2009;

The amount of own working capital has negative value, which in 2011 amounted to minus 3,767,852 thousand rubles;

The maneuverability coefficient of own working capital decreased during the analyzed period by 0.29 or 209%, which indicates that cash is fully included in the composition of own working capital, and its share is 39%;

The share of working capital in assets increased by 1% during the analyzed period, which is associated with an increase in cash and other current assets;

The share of inventories in current assets decreased from 24% in 2009 to 18% in 2011;

Inventories and costs of OJSC Enterprise A for the analyzed period are not covered by its own working capital.

Thus, for 2009–2011, the liquidity indicators of the balance sheet of OJSC “Enterprise A” generally do not correspond to the normative ones.

Let's calculate the equity ratio using table 7.

Table 7. Analysis of the solvency of JSC "Enterprise A"for 2009–2011

Indicator name	Calculation formula	Standard
Current ratio
Equity ratio

As we see, OJSC “Enterprise A” for 2009–2011 sufficient level own funds.

In market conditions, the role of profitability indicators is great. An analysis of the profitability of working capital of OJSC "Enterprise A" is presented in table 8.

Table 8. Analysis of the profitability of working capital of the branchJSC "Enterprise A"

Indicators

1.Net profit, thousand rubles.
2.Current assets, thousand rubles.
3.Profitability of current assets (item 1 / item 2)*100,%
4. Accounts receivable, thousand rubles.
5. Profitability of accounts receivable (item 1 / item 4) * 100, %
6. Inventories and costs, thousand rubles.
7. Profitability of inventories and costs (item 1 / item 6) * 100, %
8. Short-term financial investments, thousand rubles.
9. Profitability of short-term financial investments (item 1 / item 8) * 100, %

As the data presented in Table 8 show, there is a decrease in all indicators of profitability of working capital due to a decrease in the net profit of the enterprise.

Thus, the profitability of all current assets decreased in 2009–2011 from 15.82% to 2.51%, the profitability of inventories and costs from 66.51% to 13.79%, the profitability of accounts receivable - from 24.69% to 4. 76%.

Let's analyze the profitability of all assets of the enterprise using a factor model based on the method chain substitutions (Table 9) :

Table 9. Analysis and assessment of the profitability of assets of JSC "Enterprise A", thousand rubles.

Indicators

1. Profit from sales, P
2. Sales revenue, N
3. Full cost products sold, Sp
4. Average inventory balances, including VAT, 3
5. Average balances of current assets, OA
6. Average asset balances, A
Estimated data - factors
7. Revenue per 1 rub. cost (item 2: item 3), X
8. Share of current assets in the formation of assets (clause 5: clause 6), Y
9. Share of inventories in the formation of current assets (clause 4: clause 5), Z
10. Inventory turnover in revolutions (clause 3: clause 4), L
11. Return on assets, rа
12. Change in return on assets to a variable base
Assessing the influence of factors on changes in return on assets
13. Revenue per 1 rub. cost, X
14. Share of current assets in the formation of assets, Y
15. Share of inventories in the formation of current assets, Z
16. Inventory turnover in revolutions, L
Cumulative influence of all factors

The results of the calculations allow us to conclude that in all analyzed periods, sales revenue was higher than cost. The company received its greatest profit in 2009.

The share of current assets in the formation of assets throughout the entire period under study remains virtually unchanged.

The dynamics of the indicator of the share of inventories in the formation of current assets indicates that over the three years under study there was a gradual decrease from 24% to 18%. This figure reached its maximum in 2009.

The fourth factor of the model - inventory turnover - shows how many turnovers inventories make during the reporting year in the process of production and sales of products. The dynamics of this indicator shows that the organization has developed unfavorable circumstances that contribute to a decrease in the efficiency of inventory use. This is understandable if you look at the dynamics of sales revenue and inventory.

Revenue from product sales is growing at a slower pace than inventories. In 2011, the inventory turnover rate decreased and amounted to 26.93 turns per year, that is, approximately 13.4 days. It should be noted that this indicator at the beginning of the analyzed period was at the level of 11.3 days.

The influence of each individual factor on the performance indicator can be determined using factor analysis. Its results are presented in the final part of Table 3.6.

The data obtained can be commented on as follows.

In 2010, compared to 2009, the main factor that influenced the growth of profitability of assets was price - the share of revenue per 1 ruble of cost. As a result of its impact, return on assets decreased by 6%.

The overall influence of factors on the growth of profitability of current assets in 2009–2010 was minus 7%.

In 2011, the factor of the share of revenue per 1 ruble of cost ceased to play a decisive role in changing the performance indicator. Due to its slight growth, return on assets increased by 3%.

The change in inventory turnover had a negative impact and amounted to minus 1%.

Also, a decrease in the share of inventories in the formation of current assets had a negative impact on the growth of profitability of assets. As a result of its impact, return on assets decreased by 1%.

The overall influence of factors on the growth of profitability of current assets in 2010–2011 was 1%.

The results of the analysis show that external factors have a great influence on changes in the level of production efficiency. At the same time, the organization has internal reserves for increasing production efficiency, for example, by optimizing the structure of assets, increasing their turnover, etc. Since the enterprise administration is unable to influence the change external factors, then the greatest efforts must be directed to the use of internal reserves.

Thus, using the proposed methodology, we analyzed the influence of various factors to change the level of profitability of the organization's main production activities.

We will conduct a general analysis of the state of working capital of the branch of OJSC "Enterprise A" by combining the assessment indicators into a single table 10.

Indicator name
Indicator name	meaning	meaning	meaning

1. Return on current assets, %
2. Current liquidity
3. Urgent liquidity
4. Absolute liquidity
5. Growth rate of the most liquid assets, %
6. Growth rate of quickly sold assets, %
7. Growth rate of slowly selling assets, %
8. Share of working capital financing costs in their total amount, %

The rating of the working capital status of OJSC "Enterprise A" for 2009–2011 increased by 1 point, and its value by 2011 amounted to 23 points. This value refers to the average, that is, the state of working capital in the analyzed period is normal with a tendency to improve its structure.

Important when managing working capital is the process of rationing working capital and monitoring compliance with the calculated standards. The need to analyze compliance with standards is based on the fact that an enterprise can invest a significant amount of funds, for example, in inventories, which will disrupt its liquidity.

We will calculate the working capital needs of OJSC Enterprise A based on available data on sales volume and working capital turnover period (Table 11) .

Table 11. Calculation of working capital ratioJSC "Enterprise A"

Indicator name

Sales volume (revenue from sales), thousand rubles.
Actual average value of current assets, thousand rubles.
Period of turnover of working capital, days
Working capital turnover ratio
Requirement for working capital = Revenue of the reporting period / Turnover of working capital of the previous period
Deviation of actual values from calculated values

As we can see, in general, the available volume of working capital at the enterprise exceeds the calculated standard. In 2010, the excess amounted to 863,572 thousand rubles, and in 2011 – 1,639,643 thousand rubles.

Let's consider which items of working capital accounted for the excess over the standard. To do this, we will calculate the turnover of individual items of working capital (Table 3.2) and the need for working capital of OJSC “Enterprise A” for 2010 and 2011 and analyze deviations from actual data (Table 12) .

Table 12. Calculation of working capital turnover of OJSC "Enterprise A"

Indicator name

1. Sales revenue
2. Average value of current assets
3. Average inventory and costs
4. Average amount of accounts receivable
5. Average amount of cash and short-term financial investments
6. Turnover of current assets (clause 1 / clause 2)
7. Inventory turnover and costs (clause 1 / clause 3)
8. Accounts receivable turnover (clause 1 / clause 4)
9. Cash turnover and short-term financial investments (clause 1 / clause 5)

The planned volume of financial needs is calculated using the formula:

Table 13. Calculation of financial needs of JSC "Enterprise A"

Indicators	Deviation	Deviation
Indicators	Deviation	Deviation

1. Average inventory and costs
2. Average amount of accounts receivable
3. Average amount of cash and short-term financial investments
4. Average value of current assets

As we can see, for all items of working capital, the actual values are higher than the calculated standards. Consequently, the reserves for increasing the efficiency of using working capital of JSC Enterprise A are:

Acceleration of working capital turnover;

Increasing the profitability of services.

Thus, as a result of the analysis, the following general conclusions can be drawn:

There is a decrease in the economic turnover of OJSC “Enterprise A” for 2009–2011;

During the analyzed period, the volume of working capital of JSC Enterprise A increased by 534,205 thousand rubles;

In general, the growth of the current assets of OJSC “Enterprise A” for the analyzed period was due to the growth of cash and other current assets;

In OJSC "Enterprise A", the duration of the financial cycle increased over the analyzed period by 11 days - from 6 days in 2009 to 17 days in 2011, which is a negative trend, since there was an increase in the receivables turnover period;

The duration of the operating cycle at the enterprise also increased - from 37 days in 2009 to 54 days in 2011, which can be characterized as a negative trend;

For 2009–2011, the liquidity indicators of the balance sheet of OJSC “Enterprise A” generally do not correspond to the normative ones;

In 2009, normal financial stability was observed, since the amount of reserves and costs exceeded the value of own working capital, but was covered by the main sources for the formation of reserves and costs;

There is a decrease in all indicators of profitability of working capital due to a decrease in the net profit of the enterprise;

The state of working capital in the analyzed period can be assessed as normal with a tendency to improve its structure.

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The presence of an enterprise's own working capital, its composition and structure, the speed of turnover and the efficiency of use of working capital largely determine the financial condition of the enterprise and the stability of its position on the market. financial market, namely;
solvency, i.e. the ability to repay one’s debt obligations on time;
liquidity - the ability to make transactions at any time necessary expenses;
opportunities for further mobilization of financial resources.
Effective use of working capital plays a big role in ensuring the normalization of the enterprise, increasing the level of profitability of production and depends on many factors. IN modern conditions huge negative influence the factors of the crisis state of the economy affect the change in the efficiency of using working capital and the slowdown in their turnover;
decline in production volumes and consumer demand;
high rates inflation;
severance of economic ties;
violation of contractual and payment discipline;
high level tax burden;
decreased access to credit due to high bank interest.
All of these factors influence the use of working capital, regardless of the interests of the enterprise. At the same time, enterprises have internal reserves for increasing the efficiency of using working capital, which they can actively influence. These include: rational organization of inventories, reducing the presence of working capital in work in progress, efficient organization appeals.

This indicator characterizes the amount of profit received for each ruble of working capital and reflects the financial efficiency of the enterprise, since it is the working capital that ensures the turnover of all resources in the enterprise.
In Russian economic practice, the efficiency of using working capital is assessed through indicators of its turnover. Since the criterion for assessing the effectiveness of working capital management is the time factor, indicators are used that reflect, firstly, the total turnover time, or the duration of one turnover in days, and, secondly, the turnover rate.
The duration of one turnover in days covers the duration of the production cycle and the amount of time spent on the sale of finished products, and represents the period during which working capital passes through all stages of the circulation at a given enterprise.
The duration of one turnover (working capital turnover) in days OB is determined by dividing the working capital So by one-day turnover, defined as the ratio of the volume of sales of RP to the duration of the period in days D or as the ratio of the duration of the period to the number of revolutions Cob.:
.
The shorter the duration of the circulation period or one turnover of working capital, the less other things being equal, the enterprise requires less working capital. The faster working capital circulates, the better and more efficiently they are used. Thus, the timing of capital turnover affects the total working capital requirement. Reducing this time is the most important area of financial management, leading to increased efficiency in the use of working capital and an increase in their return.
The turnover rate characterizes the direct turnover ratio (number of revolutions) for a certain period of time - a year, a quarter. This indicator reflects the number of turnovers made by the working capital of the enterprise, for example, per year. It is calculated as the quotient of the volume of sold (or commodity) products divided by working capital, which is taken as the average amount of working capital:

The direct turnover ratio shows the amount of sold (or marketable) products per 1 ruble of working capital. An increase in this coefficient means an increase in the number of revolutions and leads to the fact that;
production output or sales volume increases for each invested ruble of working capital;
the same volume of production requires a smaller amount of working capital.
Thus, the turnover ratio characterizes the level of production consumption of working capital. An increase in the direct turnover ratio, i.e. an increase in the rate of turnover made by working capital, means that the enterprise uses working capital rationally and efficiently. A decrease in turnover indicates a deterioration in the financial condition of the enterprise.

,
where Kz is the load factor.
Comparison of turnover and load ratios over time allows us to identify trends in changes in these indicators and determine how rationally and effectively the working capital of the enterprise is used.
The turnover of working capital may accelerate or slow down. When turnover slows down, additional funds are involved in turnover. The effect of accelerating turnover is expressed in a reduction in the need for working capital due to improved use and savings, which affects the increase in production volumes, and as a result, financial results. Acceleration of turnover leads to the release of part of the working capital (material resources, cash), which are used either for production needs or for accumulation in a current account. Ultimately, solvency and financial condition improves.

More on the topic Indicators of the use of working capital of an enterprise:

Working capital (working capital) of enterprises: essence, composition and ways to improve efficiency of use

Availability commercial organization own working capital, its composition and structure, turnover rate and efficiency of use of working capital largely determine the financial condition of the enterprise and the stability of its position in the financial market, the main indicators of which are:

- solvency, i.e. the ability to repay your debt obligations on time;
- liquidity - the ability to make necessary expenses at any time;
- opportunities for further mobilization of financial resources.

Effective use of working capital plays a big role in ensuring the normalization of the enterprise, increasing the level of profitability of production and depends on many factors.

In modern conditions, the factors of the crisis state of the economy have a huge negative impact on the efficiency of using working capital and the slowdown in their turnover:

- reduction in production volumes and consumer demand;
- high inflation rates;
- severance of economic ties;
- violation of contractual and payment and settlement discipline;
- high level of tax burden;
- decreased access to credit due to high bank interest rates.

These factors influence the use of working capital regardless of the interests of the enterprise. At the same time, enterprises have internal reserves for increasing the efficiency of using working capital, which they can actively influence. These include:

- rational organization of production inventories;
- reducing the presence of working capital in work in progress;
- effective organization of circulation.

In Russian economic practice, the efficiency of using working capital is assessed through indicators of its turnover. Since the criterion for assessing the effectiveness of working capital management is the time factor, indicators are used that reflect, firstly, the total turnover time, or the duration of one turnover in days; secondly, the turnover rate.

The duration of one turnover in days covers the duration of the production cycle, and the amount of time spent on the sale of finished products, and represents the period during which working capital passes through all stages of the circulation at a given enterprise.

The duration of one turnover in days is determined by dividing working capital by one-day turnover, defined as the ratio of sales volume to the duration of the period in days or as the ratio of the duration of the period to the number of turnovers.

We can say that the time of capital turnover affects the need for total working capital. Reducing this time is the most important area of financial management, leading to increased efficiency in the use of working capital and an increase in their return.

The turnover rate characterizes the direct turnover ratio for a certain period of time - a year, a quarter. This indicator reflects the number of turnovers made by the working capital of the enterprise. It is calculated as the quotient of the volume of products sold by working capital, which is taken as the average amount of working capital for a certain period.

The direct turnover ratio shows the amount of products sold per 1 ruble. working capital. An increase in this coefficient means an increase in the number of revolutions and leads to the fact that:

- production output or sales volume increases for each invested ruble of working capital;
- the same volume of production requires a smaller amount of working capital. working capital solvency financial

Consequently, the turnover ratio characterizes the level of production consumption of working capital. Increase in direct turnover ratio. A decrease in turnover indicates a deterioration in the financial condition of the enterprise.

The inverse turnover ratio, or working capital load factor, shows the amount of working capital spent on each ruble of products sold.

Turnover indicators can be calculated for all working capital and for its individual elements, such as inventories, work in progress, finished and sold products, funds in settlements and accounts receivable.

Inventory turnover is calculated as the ratio of production costs to average stocks; work in progress turnover - as the ratio of goods received to the warehouse to the average annual volume of work in progress; turnover of finished products - as the ratio of shipped or sold products to the average value of finished products; Fund turnover in calculations is the ratio of sales revenue to average accounts receivable.

The listed indicators make it possible to conduct an in-depth analysis of the use of own working capital; they are called private turnover indicators.

The release of working capital as a result of accelerating their turnover can be absolute and relative. Absolute release is a direct reduction in the need for working capital, which occurs in cases where the planned volume of production is completed with a smaller volume of working capital compared to the planned requirement.

The relative release of working capital occurs when, in the presence of working capital within the planned requirement, the production plan is exceeded. At the same time, the growth rate of production volume is faster than the growth rate of working capital balances.

Economic content of working capital. Composition and structure of working capital.

Analysis and management of working capital

Explanations for balance sheet and profit and loss statement.

Cash flow statement.

Statement of changes in equity.

This form provides indicators on the state and changes in equity capital, target revenues, and estimated reserves.

This report contains information about the receipts and directions of use of the organization's funds in the reporting period in the context of current, investment and financial activities.

They represent a set of analytical transcripts and explanations for a number of items in the balance sheet and profit and loss statement. For example, this form reflects the structure, receipt and disposal of intangible assets, fixed assets; changes in the structure of financial investments; availability and movement of inventories, accounts receivable (including overdue), accounts payable; production cost structure.

Questions for self-control

1. Who can be users of information about the organization’s activities? What is the interest of each user group?

2. What requirements must the information used for acceptance meet? management decisions?

3. Name internal and external sources information support financial management.

4. Name the forms of accounting financial statements generated by the organization and used to analyze financial and economic activities.

5. Give an economic interpretation of the main sections and articles of each form of financial statements.

5.1. Economic content of working capital. Composition and structure of working capital.

5.2. Indicators of efficiency in the use of working capital.

5.3. Financial and production cycle.

5.4. Calculation of the enterprise's need for working capital.

5.5. Working capital management.

Working capital- these are the assets of an enterprise that are renewed with a certain regularity to ensure current activities, investments in which are turned over at least once during the year or one production cycle. Unlike fixed assets, which are repeatedly involved in the production process, working capital operates only in one production cycle and completely transfers its value to the newly manufactured product.

Circulation of working capital, ensuring continuity of the production and circulation process.

Formula for the movement of current assets:

DS → MPZ → WIP → GP → DZ → DS",

where DS – funds advanced into current assets;

MPZ – inventories;

WIP – work in progress;

GP – finished products in warehouse;

DZ – accounts receivable;

DS" – cash in the form of proceeds from the sale of goods.

Since working capital includes both material and monetary resources, the process of material production and the financial stability of the enterprise depend on their organization and effective use. Therefore, every enterprise, regardless of its form of ownership, scope of activity and its scale, is the key to success by properly organizing working capital, including:

Composition and structure of working capital;

Determining the need for working capital;

Identification and correct determination of sources for the formation of working capital;

Effective use of working capital.

Business experience recent years showed that where the managers of the enterprise did not pay attention to the organization and use of working capital, there were negative results not only in terms of payment and settlement operations, but there were serious failures in the production process. This not only proves the unity and interdependence of the circulation process, but also dictates objective requirements rational organization working capital – i.e. principles of organization of working capital.

Classification of working capital:

1. Depending on the functional role in the production process:

1.1.Negotiable production assets, which serve the production sector. They materialize in production inventories (raw materials, supplies, fuel, containers, semi-finished products and components, household equipment, spare parts for repairs, etc.) and in production costs (work in progress, deferred expenses).

The main purpose of funds invested in working production assets is to ensure a systematic and rhythmic production process at the enterprise. Thus, circulating production assets serve the production sector, completely transfer their value to the newly created product during one production cycle, while changing their original form.

1.2.Circulation funds. They are not directly involved in the production process. Their purpose is to provide resources for the circulation process, to maintain the circulation of enterprise funds and to achieve unity of production and circulation. Circulation funds consist of stocks of finished products in warehouses, goods shipped, cash in hand and in bank accounts, accounts receivable, short-term financial investments and funds in other settlements.

The continuity and unity of the process of circulation of enterprise resources allows us to combine circulating production assets and circulation funds into a single concept - working capital. Thus, working capital is the enterprise’s funds advanced into circulating production assets and circulation funds in order to ensure the uninterrupted process of production and sales of products.

2. According to the degree of planning:

2.1. Standardized working capital – These are reserves and costs calculated according to economically feasible standards. Working capital assets and partially circulation assets are normalized, namely the balances of unsold finished products in the enterprise warehouse.

2.2. Non-standardized working capital– other elements of circulation funds: goods shipped, cash, accounts receivable. Lack of norms doesn't mean that the size of these elements of working capital can change arbitrarily and indefinitely and that there is no control over them.

3. By the degree of liquidity (speed of conversion into cash)

3.1. Absolutely liquid funds– cash in hand and in the current account are the most mobile funds that can be used to pay off obligations immediately.

3.2.Quickly implemented products– short-term financial investments, shipped goods, accounts receivable – it takes a certain time to convert these assets into cash.

3.3.Slowly selling working capital– inventories, costs in work in progress, finished products, doubtful and overdue accounts receivable. In terms of the degree of financial risk, this group is the least attractive from the position of investing capital in the working capital of the enterprise.

However, the division of working capital into quickly and slowly realized ones is not absolute and depends on the real situation of a specific period of the enterprise’s activity. It may happen that the remaining finished products in the enterprise’s warehouse are sold faster (for cash) than the receivables are due.

The composition and structure of working capital depends on many factors:

Industry Features production and nature of activity;

Production and sales volumes;

The nature and complexity of the production cycle;

Duration of the production cycle;

The cost of raw materials and supplies, their role in the production process;

Level of logistics;

Market conditions;

Payment procedure and settlement and payment discipline;

The level of prices prevailing on the market;

Fulfillment of mutual contractual obligations;

Financial condition of the enterprise.

Taking into account the listed factors to determine and maintain optimal level volume and structure of working capital is the most important goal of working capital management.

The effective use of working capital has an active influence on the progress of production, financial results and the financial condition of the enterprise. The released material and monetary resources are an additional internal source of further investment, helping to increase the financial stability of the enterprise and its solvency. Under these conditions, the company fulfills its obligations in a timely manner and in full.

The efficiency of using working capital is characterized by system of indicators:

1. Own working capital (own working capital) – characterizes that part of current assets that is financed from own funds or long-term liabilities.

SOK = Current assets – Current liabilities,

where SOK is own working capital;

RNS must be > 0

Having your own working capital is a necessary condition for ensuring the financial stability of an enterprise. It is recommended to set the minimum value of this indicator in the amount of 10% of the total volume of current assets.

The higher this indicator, the more stable the financial condition of the enterprise, the more opportunities it has to pursue an independent financial policy. However, too large (more than 50% of current assets) is not very good, since the company does not use cash efficiently.

2.Turnover of working capital - This is the duration of one complete circulation of funds, from the acquisition of inventories to the sale of finished products and the receipt of money in the current account of the enterprise.

The faster working capital goes through these phases, the more products an enterprise can produce using the same amount of working capital. Turnover depends on the specifics of production and sales conditions, features in the structure of working capital and other factors.

The turnover rate of working capital is calculated using the following indicators:

2.1. Turnover rate (turnover ratio)– the number of revolutions made by working capital and its individual elements during the analyzed period.

The turnover ratio is calculated using the following formula:

K about = V / C about,

where K 0 is the turnover ratio of current assets;

B – revenue from sales of products;

C about - the average value of current assets for the analyzed period = (current assets at the beginning of the period + current assets at the end of the period) / 2.

2.2. Load factor of current assets– an indicator inverse to the turnover ratio. It shows how much working capital is per 1 ruble. revenue from product sales. The load factor is calculated using the following formula:

K zos = 1 / K o, or K zos = C about / B,

where K zos is the load factor of current assets;

K 0 – turnover ratio of current assets;

2.3. Turnover period (duration of one turnover of working capital)– the average period for which money invested in production and economic operations is returned.

The duration of one turnover of working capital is calculated by the formula:

D ob = T * C ob / V,

where D about is the duration of one turnover of current assets, in days;

T – number of days in the analyzed period (year – 360 (365) days, quarter – 90 days);

C ob – the average value of current assets for the analyzed period;

B – revenue from sales of products.

There are general and private turnover.

Total turnover characterizes the intensity of use of working capital in all phases of the circulation, without reflecting the characteristics of the circulation of individual elements or groups of working capital.

Private turnover reflects the degree of use of working capital in each individual phase of the circulation, in each group, as well as for individual elements of working capital (inventory turnover, accounts receivable turnover, etc.).

The faster working capital circulates, the better and more efficiently they are used. Accelerating turnover leads to the release of part of the working capital (material resources, cash), which can be used by the enterprise for further expansion of production, development of new types of products, improvement of supply and sales and other measures to improve business activities.

3. Relative release of working capital represents the difference between the organization's working capital requirement, calculated on the basis of the planned or actually achieved turnover in the reporting year, and the amount with which the organization ensured the implementation of the production program in the next year.

The relative release of working capital as a result of changes in the duration of one revolution is determined as follows:

V os = (D obf – D obbas) * V f,

where D obf is the turnover period of working capital in the reporting period, in days;

D obbase – period of turnover of working capital in the base (previous) period, in days;

V f – average daily revenue from product sales in the reporting period.