Financial results

In modern conditions of conducting a market economy, the indicator of the financial result of the enterprise's activity is the most significant in the work of business entities. Its size is a criterion for the activity of any organization.

The financial result is the amount of profit or loss that was received in the reporting period from the sale of products, services and works, as well as other business transactions. This indicator is the subject of attention of a large number of market participants who have an interest in the stable operation of the enterprise and the main criterion for assessing commercial activities.

The financial result depends on a number of factors:

- efficiency in the use of production resources;

- compliance with the discipline of payments and the terms of contracts;

- changes in prices on commodity and commodity markets , etc.

The financial result also depends on the amount of income received. The size of the company's profit affects the payment of labor of employees and mandatory deductions to the budget. Also on its magnitude depends the incomes of the founders. A positive financial result is an important criterion for attracting investors, partners in joint business, as well as creditors.

Formation of the financial results of the organization is made on the basis of income received from basic and auxiliary activities. On the basis of analytical accounting, the gross profit margin is derived. It is the difference obtained as a result of deduction of revenue and cost of sales, management and commercial expenses.

The indicator of gross profit serves as a criterion for the main activity of the organization. Profit, which the organization forms for taxation, takes into account all received incomes and expenses. In addition to gross profit, this includes results from other activities, which may include the leasing of fixed assets for rent, participation in currency and stock exchanges, etc. The amount remaining after the payment of taxes to the budget is distributed by the enterprise for its development and for dividends for the founders.

The financial result received by the enterprise from its activities depends on profit and profitability. The main positive criterion for the work of any entity is the receipt of income. Setting itself the task of increasing profits, the company seeks to increase the volume of products, while reducing the cost of its production.

The size of the income of the business entity serves as the main indicator for investors, which determines the level of return on the invested funds in assets. In a market economy, the main task is to maintain the necessary level of profitability of the organization. The fall of this indicator indicates an unsatisfactory state of business and serves as a prerequisite for bankruptcy of the enterprise.

The level of profitability is a relative criterion, indicating the efficiency of conducting business operations. This indicator is characterized by a comparison function. The level of profitability allows to draw a conclusion about the degree of income, profit and benefits. It is this indicator that gives an estimate of the amount of profit that was received by the enterprise from each ruble invested in the assets. Profitability makes it possible to fully assess the final result of economic activity, showing the ratio of the final results to the volume of cash or used production resources.

In the conditions of increasing competition and the desire to increase profitability, the analysis of financial results is an obligatory function of enterprise management. It allows you to find a reserve of increased profit and profitability, as well as enables the business entity to operate more efficiently.