Assessment of the Determinats of Financial Security of Railways in Ukraine

Abstract

The paper is devoted to the study of determinants determined the level of financial security of economic systems. It is shown that the financial security of an economic system implies the achievement of a level of financial stability that will contribute to simultaneously maintaining financial equilibrium and ensuring targeted growth in line with the development strategy. The level of financial security of rail transport in Ukraine was analyzed and it was determined that the decline in its security was the result of a complex interaction of external and internal factors, the main of which were tight government regulation, shifting the financial burden of social responsibilities to Ukrzaliznytsya, PJSC, lack of competition in the transportation of the main nomenclature of cargo and the unsatisfactory state of non-current assets. Based on the Argenti's method, it is shown that the consequence of the inefficient financial management of Ukrzaliznytsia, PJSC are the reduction of its insolvency. Three main determinants of the financial security of rail enterprises were identified: a reduction in traffic volumes, an unstable capital structure and the impossibility of timely repayment of current liabilities. An additive model for assessing the impact of selected determinants on the level of financial security of Ukrzaliznytsia, PJSC is proposed. The analysis of the model parameters showed that the greatest impact has the index of industrial production, which is due to the predominant formation of its own financial resources of rail transport due to income from freight traffic. A complex of measures designed to improve the financial condition of rail enterprises was proposed. It is substantiated that in order to equalize existing threats, it is necessary to take political decisions aimed at improving the financial condition of Ukrzaliznytsia, PJSC by reducing the intensity of leaching of its financial resources, as well as implementing an anti-crisis financial strategy aimed at optimizing the capital structure and financial rehabilitation of rail enterprises.

Dentification the Ways of Counteraction of the Threats to the Financial Security of High-Tech Enterprises

“…How external and internal threats affect the financial security management of enterprises in Eastern Europe were investigated by Britchenko et al (2018). They offer a whole range of measures to counter existing threats to the financial security of the enterprise.…”

Implementation of Anti-Crisis Management in the Context of Ensuring Sustainable Development of the Enterprise

“…There are two reasons for this: when the first manifestations of the financial crisis appeared, or for constant functioning in order to prevent it. The decision to introduce an anti-crisis management system is made by the management of the enterprise [4][5][6]. The next step is to determine the main goal with which the anti-crisis management is formed at the enterprise.…”

Financial Security of the Enterprise: An Alternative Approach to Evaluation and Management

“…Scientific works are devoted to the justification of modern methodological approaches to the assessment of the level and position of the financial security of an enterprise are: Azarenkova et al (2018), Britchenko et al (2018), Khudoliei (2018), Hryhoruk et al (2019), Kosaynova et al (2019), Drobyazko et al (2020), Franchuk et al (2020), Kharchuk et al (2020), Kondratenko et al (2020), Sylkin et al (2020).…”

“…The main approaches to estimating the level of financial security of the enterprise, which are currently presented in the professional literature -are the coefficient, which involves the calculation of a set of financial indicators (Delas et al, 2015;Yeletskykh, 2017;Pera, 2017;Kharchuk et al, 2020); integrated, based on the definition of an integrated indicator of financial security (Ganushchak, 2017;Khudoliei, 2018;Azarenkova et al, 2018;Kosaynova et al, 2019;Kharchuk et al, 2020); based on the diagnosis of the probability of bankruptcy (Valaskova et al, 2020;Sylkin et al, 2018Sylkin et al, , 2019Sylkin et al, , 2020Koleda & Lāce, 2008;Bilomistniy et al, 2017;Britchenko et al, 2018;Nguyen & Nguyen, 2020;Franchuk et al, 2020). There are also several author's methods for assessing financial security: Hryhoruk et al (2019) -model for assessment of the financial security level of the enterprise based on the desirability scale; Zwolak (2017) -empirical model based on the Cobb-Douglas power function.…”