Instruction
1
To assess the liquidity of the company will be required to divide the assets and liabilities of the organization into certain groups.
Assets are divided into 4 groups:
- A1 – all assets that can be called absolutely liquid (cash, accounts in banks and short-term investments);
- A2 – the assets that can be quickly implemented (and shipped finished products and accounts receivable);
- A3 – raw materials, inventories and semi-finished – all that requires a fairly long time for conversion into cash;
- A4 – illiquid assets (fixed assets, unfinished construction projects, as well as all long-term financial investments of the organization).
Liabilities, similar to assets, also divided into 4 groups:
- L1 – term liabilities, such as loans, which was due for repayment;
- L2 – liabilities average maturity – loans and short-term loans;
- P3 – long-term loans;
- A4 – the capital, which is always at the disposal of the organization.
Assets are divided into 4 groups:
- A1 – all assets that can be called absolutely liquid (cash, accounts in banks and short-term investments);
- A2 – the assets that can be quickly implemented (and shipped finished products and accounts receivable);
- A3 – raw materials, inventories and semi-finished – all that requires a fairly long time for conversion into cash;
- A4 – illiquid assets (fixed assets, unfinished construction projects, as well as all long-term financial investments of the organization).
Liabilities, similar to assets, also divided into 4 groups:
- L1 – term liabilities, such as loans, which was due for repayment;
- L2 – liabilities average maturity – loans and short-term loans;
- P3 – long-term loans;
- A4 – the capital, which is always at the disposal of the organization.
2
Begin analysis of the company's liquidity balance check. The balance of the organization can be considered absolutely liquid, only fair if all the 4 following inequalities:
1. A1 > A1;
2. A2 > P2;
3. A3 > P3;
4. A4 < A4.
1. A1 > A1;
2. A2 > P2;
3. A3 > P3;
4. A4 < A4.
3
Calculated figure (current liquidity) that speaks of a positive solvency of the organization in the near future at the time of consideration of time:
TL (current liquidity) = ∑(A1,A2) – ∑(P1,P2).
TL (current liquidity) = ∑(A1,A2) – ∑(P1,P2).
4
Evaluated prospective liquidity of the company based on future payments and receipts.
PL (potential liquidity) = A3 – A3.
PL (potential liquidity) = A3 – A3.
5
Define the factors used to judge the solvency of the organization at the moment and in the near and longer term.
KTL (current ratio) = ∑(A1,A2,A3) / ∑(P1,P2)
This coefficient suggests the extent to which existing obligations are provided by the assets of the organization. In cases where the value is less than 1, say about the excess of liabilities over assets.
KBL (quick ratio) = ∑(A1,A2) / ∑(P1,P2)
This assessment is the liquidity of the company allows to judge which part of the obligations, the organization is able to perform in a critical situation when there is no opportunity to sell holdings. Economists suggest to keep this setting greater than the value of 0.8.
Cal (absolute liquidity ratio) = A1 / ∑(P1,P2)
This parameter shows what part of debt the firm is able to soon repay. The value of the coefficient should not fall below the value of 0.2.
KTL (current ratio) = ∑(A1,A2,A3) / ∑(P1,P2)
This coefficient suggests the extent to which existing obligations are provided by the assets of the organization. In cases where the value is less than 1, say about the excess of liabilities over assets.
KBL (quick ratio) = ∑(A1,A2) / ∑(P1,P2)
This assessment is the liquidity of the company allows to judge which part of the obligations, the organization is able to perform in a critical situation when there is no opportunity to sell holdings. Economists suggest to keep this setting greater than the value of 0.8.
Cal (absolute liquidity ratio) = A1 / ∑(P1,P2)
This parameter shows what part of debt the firm is able to soon repay. The value of the coefficient should not fall below the value of 0.2.
