| Abstract [eng] |
Working Capital Efficiency and Risk Management in JSC ”X“ Working capital and its management are analyzed by many authors both Lithuanian and foreign. Only a small number of companies have a more or less defined and consistent short-term asset management policy in Lithuania. The most common phenomenon is spontaneous actions provoked by a certain situation, aimed at solving one-time problems. Working capital is the value of current assets necessary to maintain a certain level of production and sales. The company's activities depend on working capital, so the most famous financial analysis experts suggest to start the financial condition of companies from working capital analysis. Working capital is one of the few indicators that fairly objectively describes the condition of the company and has a significant impact on other financial indicators. The problem is that there is no consistent working capital analysis methodology in the financial analysis literature. Only some working capital indicators calculations and their interpretation are provided. And the companies problem is that not all of companies analyze working capital and therefore face problems that are too late to solve. Some companies simply expect nothing to happen to their activities, and the goal of each company must be to analyze, create a process for evaluation, management, and forecasting. Those companies that mismanaged their working capital in the face of a pandemic (which is relevant in the current period) may not survive. The company's head managers had to predict a possible crisis few years ago and take actions that would help the company to survive and operate profitably. Increasing working capital and reducing bank liabilities is one of the possible solutions for a company to remain in the market during a crisis. The master's work is relevant to that many companies incorrectly manage their working capital, which can lead to a reduction in wages, staff reductions, increased losses, increased debt, etc., and in the worst case, bankruptcy of the company. Companies are also not preparing for the crisis and are unable not only to make a profit on the company’s basic expenses during the recession but also to survive in the market. Every company must analyze working capital, make appropriate decisions for its management and, in times of crisis, have sufficient funds and be able to make appropriate decisions in favor of the company. The study object has been chosen joint-stock company “X” and its 2017 - 2019 m. financial statements. The paper objective - to perform the analysis of the working capital of the company JSC “X” and to reveal the features of increasing the efficiency of the company's activities and reducing the risk. The work consists of three main parts. The first part reviews the concept of working capital, its financing strategies, the concept and management of working capital, cash flow management, trade debt and settlement payment risks, reserves and the company's financial cycle. The second part of the work presents the progress of the research, indicators of working capital components, receivables and payables, inventory management and the company's financial cycle. The third part briefly describes the company, analyzes the working capital of UAB “X”, analyzes the dynamics and structure of working capital components, calculates turnover indicators, analyzes receivables and payables, calculates inventory turnover and performs their analysis, and performs the financial cycle analysis. Based on performed analysis the hypothesis is accepted or rejected. At the end of the work, the conclusions of the theoretical part are presented, conclusions, suggestions and recommendations for the company are presented. |
