METHODOLOGICAL APPROACHES TO THE ASSESSMENT OF THE FINANCIAL STATE OF THE ENTERPRISE: ADVANTAGES AND DISADVANTAGES

Abstract

The purpose of the study is a critical review of methodological approaches to assessing the financial condition of enterprises and substantiating on their basis the advantages and disadvantages of modern methods of assessing the financial condition of companies. The article proves that in the conditions of the deterioration of the economic situation in Ukraine as a result of military operations, it is increasingly important not only to establish the effective functioning of economic activities of all business entities, but also to timely detect and assess the signs of crisis phenomena and identify them. The market conditions today have never been so tough and extremely volatile in all respects. All of this leads to high demands on the ability of companies operating in the market to identify risk factors in a timely manner and adapt to new business conditions. The article thoroughly examines modern methodological approaches to assessing the financial condition of an enterprise and characterizes the most commonly used ones. The main domestic methods of analyzing the financial condition of enterprises are systematized. The advantages and disadvantages of foreign and domestic methodological approaches to assessing the financial condition of enterprises are substantiated; it is proved that their number and breadth of application depend on the specific goals set by the company and are determined by strategic and current development tasks caused by the variability of the business environment and risks. The most justified is the use of the rating approach, which consists in determining the riskiness index (class) of the enterprise's financial condition depending on the integral indicator of the financial condition, loss of solvency and probability of bankruptcy. This approach will contribute to: minimize the possibility of manipulating the reporting; standardize the process of classifying the enterprise by the level of bankruptcy risk; take into account changes and trends in the parameters of the financial condition, the specifics of financial indicators depending on the type of activity of the enterprise.