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AGGREGATE DIMENSIONS USED IN CARRYING OUT THE FINANCIAL BALANCE OF THE ECONOMIC ENTITY IN FINANCIAL VISION

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Author(s): Diana-Mihaela POCIOVALISTEANU | Camelia Cătălina MIHALCIUC | Anisoara Niculina APETRI

Journal: Annals of the Stefan cel Mare University of Suceava : Fascicle of the Faculty of Economics and Public Administration
ISSN 2066-575X

Volume: 10;
Issue: 1(11);
Start page: 125;
Date: 2010;
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Keywords: financial balance | net treasury | need of working capital | working capital | net situation

ABSTRACT
A Financial Analysis is directed to assess the ability of the economic entity to generate relevant cash surpluseswhich will ensure its financial stability and development. Financial balance can be defined by the ability of economicentity to ensure uninterrupted payment of debts previously contracted, including current debt generated by carrying outits activity, or tax law from its earnings, is so that it can avoid bankruptcy risks. Maintaining financial stability is theessential condition of an economic entity’s survival and the financial stability assessment should take into account theconcrete conditions that can take one into insolvency. Moreover, equilibrium refers to a generally idea of harmonybetween the elements of a system, what in the financial field equals with the harmonization of financial resources withfinancial needs. Analysis of the financial balance can be achieved on the balance sheet based on the two concepts usedfor its development: asset and financial management. The study on the analysis of financial stability was performed onthe example of an economic entity having as main activity the production of textiles, outlining the main indicatorsthrough which one can asses the activity of the economic entity during five consecutive financial years. Within theoverall balance of the economic entity, the financial balance has an important role considering the analysis of theeconomic management requirements in terms of an entity’s relationship between debt and self-financing in connectionwith the economic entity’s training and use of funds.
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