Evaluating the effectiveness of financial policy of companies using the generalized Harrington's function

2020 ◽  
Vol 26 (2) ◽  
pp. 270-284
Author(s):  
V.A. Slepov ◽  
K.E. Pivnyk
Keyword(s):  
Electric Power ◽  
Practical Problem ◽  
Comprehensive Approach ◽  
Practical Significance ◽  
Financial Policy ◽  
Due Diligence ◽  
Financial Policies ◽  
Market Participants ◽  
Investment Option ◽  
Effective Development

Subject. The article analyzes the essence of financial policy as a factor of effective development of companies. Evaluating the effectiveness of companies' financial policies is a significant scientific and practical problem. It determines the choice of main criteria on the basis of which the effectiveness of financial policy is calculated. Objectives. The aim is to develop a comprehensive methodology for evaluating the effectiveness of companies' financial policies in modern conditions, to define criteria for its evaluation. Methods. The Due Diligence approach is a basis for solving the research tasks, i.e. comparing the existing standards and methods for evaluating companies' financial policy and simplifying its implementation through the proposed method of multivariate coefficient analysis. Results The article offers a comprehensive approach to evaluating the effectiveness of financial policy on the electric power companies case. The practical significance of obtained results is in their use to increase the investment appeal of companies that are considered as potential investment objects. Conclusions. We offer a method for evaluating the financial policy of companies based on a multivariate, customizable system of financial coefficients. We calculated an effectiveness indicator of the financial policy of companies, which can be recommended for practical use. The obtained results can be used by company management to make management decisions, by investors to choose the best investment option, by market participants to rank companies by efficiency and to determine industry benchmarks.

Development of a methodology for evaluating the effectiveness of financial policies of companies

2021 ◽  
Vol 14 (4) ◽  
pp. 364-375
Author(s):  
Vladimir A. SLEPOV ◽  
Kirill E. PIVNYK
Keyword(s):  
Practical Problem ◽  
Practical Significance ◽  
Financial Policy ◽  
Due Diligence ◽  
Practical Application ◽  
Financial Policies ◽  
Market Participants ◽  
Effective Development ◽  
Current Standards

Subject. This article presents an analysis of the essence of financial policy as a factor of effective development of companies. Evaluation of the effectiveness of the implemented financial policy of companies is a significant scientific and practical problem. It determines the choice of the main criteria used to calculate the financial policy effectiveness. Objectives. The article aims to develop a comprehensive methodology for assessing the effectiveness of financial policy of companies in modern conditions, and define criteria for its evaluation. Methods. The Due Diligence approach is the basis for solving the research tasks: comparing the current standards and methods for assessing the financial policy of companies and simplifying its implementation through the proposed method of multivariate coefficient analysis. Results. The article offers a comprehensive approach to assessing the effectiveness of financial policy, considering electric power companies as a case study. The practical significance of the results obtained lies in the use to increase the investment attractiveness of companies that are considered as potential investment objects. Conclusions. The research proposes a methodology for assessing the financial policy of companies based on a multivariate, customizable system of financial coefficients. An indicator of the effectiveness of financial policy of companies was calculated. It can be recommended for practical application. The obtained results of evaluating the effectiveness of financial policy can be used by the companies’ management to make management decisions, investors to choose the best investment option, market participants to rank companies by efficiency, and determine industry benchmarks.

Creating a group of financial ratios to evaluate financial policy of companies

2020 ◽  
Vol 26 (5) ◽  
pp. 1039-1053 ◽  
Author(s):  
K.E. Pivnyk
Keyword(s):  
Policy Implementation ◽  
Financial Market ◽  
Systems Approach ◽  
Financial Ratios ◽  
Financial Policy ◽  
Financial Policies ◽  
Financial Status ◽  
Market Participants ◽  
Investment Option ◽  
Information Basis

Subject. The article considers the analysis of financial ratios as one of important methods to evaluate the financial status of companies. The analysis results serve as a basis for company financial policy assessment. Objectives. The focus is on creating a basic group of financial ratios enabling to measure the effectiveness of financial policy implementation. Methods. The study draws on the correlation analysis, critical review of sources, and the systems approach. Results. I developed a set of financial ratios, which can be used to evaluate the effectiveness of financial policy implemented by companies. Conclusions. Certain financial ratios can serve as an objective information basis for evaluating the effectiveness of financial policies of companies. The findings can be useful for company management to evaluate the financial policy, for investors to choose the best investment option, as well as for financial market participants.

Significant financial ratios to assess the company's financial policy effectiveness

2021 ◽  
Vol 14 (3) ◽  
pp. 347-360
Author(s):  
Kirill E. PIVNYK
Keyword(s):  
Policy Implementation ◽  
Financial Market ◽  
Systems Approach ◽  
Financial Ratios ◽  
Financial Policy ◽  
Financial Policies ◽  
Market Participants ◽  
Investment Option ◽  
Information Basis ◽  
Base Group

Subject. This article fixates on the financial ratios used to assess the financial policies of companies. Objectives. The article aims to form a base group of financial ratios enabling to measure the effectiveness of company's financial policy implementation. Methods. For the study, I used a correlation analysis, critical review of subject-matter literature, and the systems approach. Results. The article presents a set of financial ratios that can be used to assess the effectiveness of financial policy implemented by companies. Conclusions and Relevance. Taken in totality, the described financial ratios can serve as an objective information basis to assess the effectiveness of companies' financial policies. The findings can be useful for company management to evaluate the financial policy, for investors to choose the best investment option, and for financial market participants.

Evaluating the effectiveness of companies' financial policies using logistic regression: A case study of electric power companies

2021 ◽  
Vol 14 (2) ◽  
pp. 208-217
Author(s):  
Kirill E. PIVNYK
Keyword(s):  
Logistic Regression ◽  
Electric Power ◽  
Logit Model ◽  
Systems Approach ◽  
Financial Analysis ◽  
Comprehensive Analysis ◽  
Financial Policy ◽  
Financial Policies ◽  
The Subject

Subject. This article assesses the effectiveness of companies' financial policies using logistic regression. It considers the financial policy assessment as a comprehensive analysis that helps evaluate the company's financial performance and make a conclusion based on a single criterion. Objectives. The article aims to develop a single (universal) criterion helping conclude of the company's financial policy effectiveness. Methods. For the study, I used a comprehensive approach based on the developed logit model, financial analysis, systems approach, and an overview of literature sources on the subject. Results. The article presents a developed methodology for evaluating the effectiveness of financial policy determined by the effectiveness of financial policy (EFP) equation for Russian electric power companies. Relevance. The results obtained can be used in practice to evaluate the financial policy by company external and internal users.

scholarly journals Premium evaluation in mergers and acquisitions of electricity companies

2019 ◽  
Vol 13 (3) ◽  
pp. 48-60
Author(s):  
Александр Викторович Стерхов
Keyword(s):  
Mergers And Acquisitions ◽  
Electric Power ◽  
Electric Power Industry ◽  
Close Correlation ◽  
Practical Significance ◽  
Coefficient Of Determination ◽  
Research Database ◽  
Business Valuation ◽  
Factors Affecting ◽  
Mathematical Algorithm

The purpose of the article is to build a model for estimating the relative premium in mergers and acquisitions of electric power companies, based on four groups of factors: the company's operating and financial results, the country affiliation, the industry affiliation, the debt market conjuncture. The research methodology is based on a comparative business valuation method. The empirical base of the research includes data on 6504 deals that occurred throughout the world from 1997 to 2018. The research database includes data on both public and non-public companies for which the amount paid in the deal is known, as well as the value of total assets. The scientific novelty consists in clarifying the conceptual apparatus (the concept of relative premium in a deal has been introduced); the selection and grouping of factors affecting the size of the relative premium; identifying and quantifying the influence of variables included in each group of factors. The article proposed the author's approach to the grouping of countries and industries, based on the equality of premium coefficients in the regression and obtained groups of countries and industries with equal premiums. It is shown that the grouping of industries, obtained by the mathematical algorithm, almost completely corresponds to the industry structure of the electric power industry. The coefficient of determination of the final econometric model is more than 20 per cent, which can be estimated as a high-quality assessment. That is because the relative premium, not the amount paid in the deal, is predicted which is in close correlation with the value of the company's assets. The practical significance of the research study consists in the possibility of predicting the value of a business, as well as determining the value paid in a deal in cases where such information is not available in available sources.

scholarly journals Improving the System of Budgeting at Industrial Enterprises

2018 ◽  
Vol 50 ◽  
pp. 01015 ◽  
Author(s):  
Larisa Yuzvovich ◽  
Ekaterina Korogodina ◽  
Lucia Azisova
Keyword(s):  
Financial Planning ◽  
Practical Problem ◽  
Planning System ◽  
Practical Significance ◽  
Financial Resources ◽  
Scientific Article ◽  
Project Financing ◽  
Corporate Sector ◽  
Industrial Enterprises ◽  
Economic Methods

The scientific article is devoted to the issues of budgeting system at industrial enterprises. The problem of improving the budgeting system in the enterprises of the corporate sector has always been a key issue for both government and business. In a time of economic turmoil and post-crisis periods, this problem becomes even more relevant. Methodological tools are analytical and economic methods of information processing. The relevance, theoretical and practical significance of the scientific research is determined by the focus on solving an important scientific and practical problem of empirical importance for budgeting within the financial planning system with limited financial resources and optimization of project financing sources.

LEGAL REGULATION OF PUBLIC FINANCIAL POLICY IN UKRAINE: CHALLENGES, IMPACT OF RISKS, LANDMARKS

2021 ◽  
pp. 104-121
Author(s):  
Larysa Trofimova ◽  
Keyword(s):  
Public Policy ◽  
Financial Crises ◽  
Legal Regulation ◽  
Economic Life ◽  
State Sovereignty ◽  
Financial Policy ◽  
Financial Policies ◽  
Economic Transformations ◽  
State Affect ◽  
The Impact

The diverse geopolitical and economic life of society during the pandemic requires awareness of the analysis of the states’ effectiveness in implementing careful public financial policies and requires proper changes in the legal regulation of relations based on understanding of social, spiritual and legal values in the context of moral and physical health of humankind. The content and nature of legal regulation of public policy, financial crises, the development of democratic institutions, awareness of the impact of risks in balancing different interests in the formation and distribution of public finances and the nature of financial activities of the state affect the dynamics of reforms and socio-economic transformations in society that change the possibilities of mankind development and create the basis for the protection of state sovereignty.

Political Capital: Mexican Financial Policy under Salinas

1998 ◽  
Vol 51 (1) ◽  
pp. 36-66 ◽  
Author(s):  
Timothy P. Kessler
Keyword(s):  
Interest Rates ◽  
Political Process ◽  
Economic Benefits ◽  
Financial Policy ◽  
Financial Policies ◽  
Degree Of Protection ◽  
Policy Making Process ◽  
The Government ◽  
High Degree ◽  
Exchange Rate Intervention

Market reform is advocated in developing countries to improve economic efficiency and prevent privileged groups from obtaining rents from the policy-making process. Yet this prescription fails to address the complex political process that governments are likely to confront when moving toward the market. This study shows how political considerations during President Salinas's administration distorted economic reform in Mexico.During the 1990s Mexican finance policy contradicted the government's declared neoliberal principles. While the banks were reprivatized and deregulated, they were also given a high degree of protection from competition, enabling the new owners to charge excessive interest rates. In addition, the government artificially inflated the value of the currency through exchange-rate intervention. These contradictory policies are best understood as a coherent political response to the electoral vulnerability of the ruling party (PRl) at the end of the 1980s. When viable political opposition threatened the PRl's ability to maintain power, it responded by using financial policies to distribute economic benefits to social groups, particularly business, the middle class, and the poor, whose support was critical for electoral victory.

Study on Rainwater Reuse System

2013 ◽  
Vol 807-809 ◽  
pp. 1413-1416
Author(s):  
Zheng Yang Wang ◽  
Chun Mei Liu
Keyword(s):  
Water Resources ◽  
Water Reuse ◽  
Practical Problem ◽  
Quality Standards ◽  
Rain Water ◽  
Practical Significance ◽  
Current Status ◽  
Actual Situation ◽  
Water Quality Standards ◽  
The World

Judging from the current status of water resources all over the world, the analysis of our country the need for reuse of rainwater and its practical significance at this stage. The using of rain water from domestic and foreign , and the actual situation of the construction of rainwater collection, processing, using of systems, rain water reuse in the case of water quality standards implementation rainwater recycling of resources. The water resources are shortage is another important practical problem ,the rainwater reuse is our country's new way to solve water resources pool. However, the disposing process of rain still has some practical problems, which will be necessary to further our study and resolve.

scholarly journals Relevancy of Corporate Financial Policies and the Profit Maximization View of Islamic Banks

2012 ◽  
Vol 3 (6) ◽  
pp. 184-193 ◽  
Author(s):  
John Taskinsoy
Keyword(s):  
Agency Theory ◽  
Profit Maximization ◽  
Share Price ◽  
Financial Policy ◽  
Islamic Banks ◽  
Short Term ◽  
Financial Policies ◽  
Policy Conflicts ◽  
Banking Institutions ◽  
Controversial Nature

This paper examines relevancy of corporate financial policies and documents similarities and/or differences of how profit maximization goal is viewed by Islamic banking institutions (IBIs). Management of the firm is ultimately responsible for maximizing profits and increasing shareholder value, however this challenging task may get plagued by agency problems as well corporate financial policy conflicts. Agency problem is real and it is assumed to occur in most companies worldwide. However, the theory’s controversial nature and its narrow focus have not really convinced many scholars whether agency theory in fact provides any broad benefits to firm’s stakeholders or not. Scholars seem to be divided into two camps on agency theory. Some authors think that agency theory pays too much attention to short-term goal of share price valuation and it hardly provides any real answers to firm’s real problems. On the other hand, some proponents of this theory believe agency theory’s useful impact on capital markets.

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