Diagnostic of Company's Financial Crisis as an Insolvency Prevention Measure
Iveta Mietule, Alona Klodāne
Available Online December 2016.
- https://doi.org/10.2991/icaat-16.2016.34How to use a DOI?
- Company crisis, crisis express-diagnostic method, crisis fundamental diagnostic method, insolvency
- Currently, the issues of insolvency and optimal financial situation of companies become increasingly topical. Simultaneously the company's crisis management with all its elements, including crisis diagnostics, have not been sufficiently studied yet. The object of the research is company's financial crisis diagnostics, the subjectÿ- methods of company's financial crisis diagnostics. The aim of the studyÿ- to carry out theoretical analysis of the company's financial crisis diagnostics in the view of insolvency preventionÿ- is achieved applying monographic or descriptive research method, comparative analysis methods, as well as employing qualitative, grouping, and graphical methods. As a result of the research, the authors have concluded that a status of company's insolvency, which can be characterized by the company's inability to perform its commitments and by predominance of the company's liabilities over its assets, is the last and the most severe stage of financial crises, mostly deriving from a long-term reluctance by the management to react to the current financial crisis in the company. Thus, one of the company's insolvency prevention options shall be timely detecting of symptoms of the company's financial crisis in its early stagesÿ- that is a priority objective of the crisis diagnostics. Crisis diagnostics is a systematic application of a several different (usually financial) models to assess the company's status and to identify possible symptoms of the crisis. Early detection of the crisis indications significantly increases possibilities of saving the company's assets.
- Open Access
- This is an open access article distributed under the CC BY-NC license.
Cite this article
TY - CONF AU - Iveta Mietule AU - Alona Klodāne PY - 2016/12 DA - 2016/12 TI - Diagnostic of Company's Financial Crisis as an Insolvency Prevention Measure PB - Atlantis Press SP - 345 EP - 353 SN - 2352-5428 UR - https://doi.org/10.2991/icaat-16.2016.34 DO - https://doi.org/10.2991/icaat-16.2016.34 ID - Mietule2016/12 ER -