Stress Testing as a Method of Forecasting and Financial Risk Assessment of a Commercial Enterprise
Journal Title: Бізнес Інформ - Year 2014, Vol 7, Issue 0
Abstract
The purpose of this paper is the research and development of stress-testing tools for assessing and predicting the degree of financial risks on the financial position and capital structure of commercial enterprise. As a result of studies, the authors developed a procedure for conducting stress testing for trade, which consists of four phases, namely: identification (identification) of financial risks; development of the financial model of the outlet; the development of stress-test scenarios; calculation of the stress tests and the interpretation of results. As a financial enterprise model it was proposed to use a simulation model of the balance, based on the capital structure of the company, presented as a source of funds and their investments. It was proved that to predict the effects of financial risks on the capital structure in the financial model it is necessary to analyze the sources of funds of the company and their investments in the context of the degree of liquidity and maturities. Also, the analysis of accounts receivable is advantageously carried out with the indicator of the level of reservation. It was suggested to use three types of stress-test scenarios that differ by the impact of risk factors on the parameters of the financial model (base, negative and critical). The scenarios for stress testing for trade were presented. The study revealed that the proposed approach provides a predictive assessment of the level of losses in the case of the implementation of financial risks. The results can be used to improve procedures predict the effects of financial risks on the capital structure using stress testing for both a commercial enterprise and companies in other industries.
Authors and Affiliations
Tetyana Yakhina, Viktoriya Foshchan
Keywords
Related Articles
- EP ID EP132029
- DOI -
- Views 125
- Downloads 0
Integrated Reporting as Competitive Advantage for Ukrainian Companies: Determinants vs. Biases
Article is aimed at the integrating reporting initiative and ongoing discussion among the parties concerned as to its conceptual framework. The aim of our research was to generalize opportunities and threats of adoption...
Designing a Sub-System of Strategically Oriented Management of Intangible Assets of an Enterprise
The goal of the article is determination and justification of main stages of designing a sub-system of strategically oriented management of intangible assets (IA) at an enterprise. The article used abstract and logical,...
Innovations in the Management System of the Development of the Social Complex of the Region
The factors of the rapid development of the social complex of the region activities have been exposed. The expediency of using the program-aim approach in the regional management mechanism has been grounded, that allows...
Paradigm of the State Innovation Policy in the EU Member Countries
The article is aimed at analysis of the existing modalities for activating innovation policy that are used by state innovation policy of innovative leaders among the countries around the world, and making proposals for a...
The Comprehensive Approach to the Formation of the Mechanism of Bank's Liquidity Management Based on an Adaptive Model
Approaches to the bank's liquidity management are developed in the article, the necessity of an adaptive model of the mechanism of the bank's liquidity management is proved.