We assess the liquidity of the balance sheet for assessing the financial position of the enterprise

The accounting reporting of the enterprise is extremely important documents, and not only for external, but also for internal users. The fact is that, based on the reporting data, you can thoroughly analyze the financial situation of the firm, identify problems and even suggest ways to address them. In the Russian practice, in the first place, such a form of reporting as the balance sheet is put . Of course, it can not be concluded on the efficiency of the enterprise, but it's quite easy to analyze the financial state. I would like to dwell in more detail on how to assess the liquidity of the company's balance sheet.

Before proceeding to the description of the method of analysis, it is necessary to identify the purpose of such an investigation. Liquidity of the balance reflects the extent to which the liabilities and assets of the enterprise are linked to each other in terms of volumes and terms . In other words, the company's urgent debts must be covered by liquid assets.

The simplest methodology, which makes it possible to estimate the least labor-intensive way, is to build a liquidity balance. To do this, you need to further group the balance items so that the number of asset groups is equal to the number of groups of liabilities. And the assets must be grouped, starting with the most liquid, and liabilities - from the most urgent. Most often, four groups are formed on each side of the balance sheet.

The grouping of assets begins with the second section, near the end of which the most liquid property is contained. Obviously, the first group consists of money and financial investments, which are implemented for a short period of time. In this case, illiquid assets should be excluded from this group.

The second group consists of assets that can be quickly transformed into money. This requirement is largely met by other current assets, as well as short-term debts of debtors.

Then you need to sum assets that can not be turned so fast into money, but you can use them to provide not the most urgent obligations. This group includes stocks, as well as longer -term financial investments.

All other assets are included in the last - fourth - group. This property is most difficult to turn into a cash form, and this indicates its low liquidity.

It is even easier to group liabilities in terms of urgency. Other short-term liabilities, as well as accounts payable are recognized as the most urgent obligations, and therefore form the first group.

The second group is created at the expense of all remaining short-term debts, which were not taken into account earlier.

The third and fourth groups are formed respectively by the fourth and third sections of the balance sheet, there is even no need for additional recalculation.

After the groups are created, they need to be compared among themselves - the first group with the first, the second with the second and so on. Absolute liquidity of the balance sheet is characterized by the fact that the assets of the first three groups must correspondingly exceed the amount of liabilities. The fourth group should observe a different ratio, as it indicates that the company has its own working capital.

If these conditions are not observed, it is necessary to carry out certain measures in order to normalize the structure of the balance sheet. It is clear that the balance will in any case converge, but less liquid assets will compensate for the more liquid only from the point of view of arithmetic, but they can not really be used to repay debts. Liquidity of the balance sheet is a very important criterion, allowing to judge the current situation of the enterprise, as well as its future prospects.