Financial stability is the basis for the economic development of a single enterprise and the state as a whole

Security and stability are the basis for the development of society. Constant revolutions and coups leading to a change in policy, rarely contribute to raising the economy to a new level. And even if this happens, it is only after years of gradual evolutionary development. Therefore, the internal stability of the state determines what the future expects its citizens in the short and long term.

Micro- and macrolevel

This rule applies to an individual. If you constantly change hobbies, then as a result you can hardly learn something. Achievement of the set goals both at the individual and the state level always takes place in two stages: choosing the right strategy and urgently executing the agenda for a sufficiently long period of time.

Political stability

The image of the state is formed under the influence of a number of factors. One of the most important of them is his ability to maintain his political course over a long period of time and ensure a high level of public confidence in the current government. Legal aspects of economic management in the country largely determine the financial component of sustainability, so it is important to understand what parameters affect it. Among them the main are:

• Effectiveness of the political system.
• Coordination of actions of public organizations and the wishes of the population.
• A high level of trust in the government.
• Legitimacy and democratic regime.
• Clear legal structure.
• Correct assignment of powers.
• Protection of human rights.
• Harmonization of formal and informal rules.
• Absence of strong class stratification and conflicts between different groups.

Financial stability of the enterprise

Survival in a market economy is associated with a constant desire to improve production efficiency. This is achieved through the introduction of advanced achievements in science and technology, more rational organization of work, motivation of the activity of personnel. But in order to be able to implement these positive changes, the enterprise must be financially stable. Otherwise, any unsuccessful step or unexpected change in market conditions - and it is on the verge of bankruptcy. Therefore, financial stability is the main object of analysis of the current state of the enterprise.

Assessment of the current situation

The financial condition of an enterprise is characterized by those resources that ensure its normal functioning and solvency. It is crisis, unstable and stable. A number of indicators are used for evaluation:

• Structure of assets and liabilities.
• Efficiency of the use of capital.
• Credibility of the enterprise.
• Solvency.
• Financial stability reserve.

The stability of the enterprise is influenced by a combination of factors: market position, product quality, potential, degree of dependence on investors and creditors, insolvency of debtors, production efficiency and staff productivity.

Business Sustainability Components

The variety of factors that influence the current situation in the enterprise determines that stability is a set of three main components. Internal stability is a financial condition in which a consistently high performance is ensured. The overall stability of the system reflects the movement of cash in the enterprise, which ensures that revenues exceed expenditures. Financial stability allows maneuvering in the market and contributes to an uninterrupted process of production and sale of goods. The coefficients obtained in the evaluation are compared with average or normal indicators, which allows to establish the current state of the enterprise.

Stability factors

Financial stability is affected both by the parameters of the internal and external environment. The first group is primarily the amount of profit, if it is sufficient to cover costs and ensure the modernization of equipment. The profitability depends on the quality and range of goods, reserves of the enterprise, reserves, the correctness of the strategy and objectives, the rationality of financial management. The external stability of an enterprise is determined by the economic environment in which it operates. Its components are the level of development of the national economy, a place in the industry, competitive advantages, relationships with local and state authorities, as well as clients, investors and lenders. In addition, financial stability is provided by material, political, non-market, surface and other factors.

Problems of Insufficient Resources

The crisis or unstable state of the enterprise is manifested in a decrease in solvency and liquidity, an increase in receivables and expenses. Current and prospective financial stability is the object of analysis of any enterprise. Based on his assessment, strategic plans are being drawn up and the agenda is being formed. In addition to insufficient stability, sometimes the enterprise is experiencing excessive stability. This also has a bad effect on functioning, since this state of things means that free financial resources are used inefficiently.

Thus, providing the objectively necessary level of stability of the enterprise is the main task of management. It is from her execution that the cloudless future and prospects for business expansion depend.