New instruments for short-term financing. Types of long-term and short-term sources of financing for the enterprise. Methods of financing an enterprise What relates to short-term financing instruments
"Financial Management", 16.02.2010
Section 1 "The essence and organization of financial management at the enterprise"
1. Financial management is. ... ... ...
1.public finance management
2. management of financial flows of a commercial organization in a market economy +
3. management of financial flows of a non-profit organization +
2. What functions are performed by the finances of organizations?
1. reproductive, control, distribution.
2.control, accounting
3.distribution, control +
3. Who forms the financial policy of the organization?
1.the chief accountant of the organization
2.finance manager +
3.head of a business entity
4. The main purpose of financial management is. ... ...
1.developing the financial strategy of the organization
2. growth of dividends of the organization
3. maximizing the market value of the organization +
5. The objects of financial management are. ... ...
1.financial resources, non-current assets, wages of key employees
2.profitability of products, return on assets, liquidity of the organization
3.financial resources, financial relations, cash flows +
6. What is the managing subsystem of financial management?
1.direction of a commercial organization
2.finance department and accounting +
3.the marketing service of the organization
7. The main job responsibilities of financial management include. ... ...
1.securities, inventory and debt management +
2. liquidity management, organization of relationships with creditors +
3.financial risk management, tax planning, development of an organization's development strategy
8. The basic concepts of financial management include concepts. ... ...
1.double entry
2.compromise between profitability and risk +
3.delegation of authority
9. The primary securities are. ... ...
3.forwards
10. The secondary securities are. ... ...
1.bonds
2.bills
3.futures +
11. The "golden rule" of financial management is this. ... ...
1.the ruble is worth more today than the ruble - tomorrow +
2.income increases as risk decreases
3.the higher the solvency, the less liquidity
12. Uniform payments or receipts of funds at regular intervals when using the same interest rate - this is. ... ... ...
1.annunity +
2.discounting
13. If equal payments of the enterprise are made at the end of the period, then such a flow is called. ... ...
1.prenumerando
2.perpetuity
3.postnumerando +
14. Derivative securities include. ... ...
1. enterprise shares
2. options +
3.bonds
15. The financial market can be attributed. ... ...
1. labor market
2.capital market +
3.sectoral product market
16. The organization mobilizes its funds for. ... ...
1.insurance market
2.the communication services market
3. stock market +
17. The organization attracts short-term loans for. ... ...
1.capital market
2.insurance market
3.money market +
18. Of the listed sources of information for the financial manager, external are. ... ...
1.Accounting balance
2. forecast of the socio-economic development of the industry +
3. statement of cash flows
19. Of the listed sources of information, it belongs to internal ones. ... ...
1.inflation rate
2. profit and loss statement +
3.data of the statistical compilation
20. External users of information are. ... ...
1.investors +
2.the financial manager of the organization
3.the chief accountant of the organization
21. The basis of information support for financial management is. ... ...
1. accounting policy organization
2.the balance sheet +
3. profit and loss statement +
22. A financial mechanism is a combination of:
1.forms of organization of financial relations, methods of formation and use of financial resources used by the enterprise +
2. ways and methods of financial settlements between enterprises
3. ways and methods of financial settlements between enterprises and the state
23. The financial tactics of the enterprise are:
1.solving problems of a specific stage of enterprise development +
2.determination of a long-term course in the field of enterprise finance, solving large-scale problems
3.development of fundamentally new forms and methods for the redistribution of enterprise funds
24. Financial management is:
1.scientific direction in macroeconomics
2.the science of public financial management
3.practical activities for managing the company's cash flows
4.financial management of a business entity +
5. academic discipline studying the basics of accounting and analysis
25. The constituent elements of the financial mechanism:
1.financial methods, financial leverage, financial settlement system
2.financial methods, financial leverage, legal, regulatory and information support
3.financial methods, financial levers, financial settlement system, information support +
26. Financial managers should primarily act in the interests of:
1.workers and employees
2.creditors
3.governmental bodies
4.strategic investors
5.owners (shareholders) +
6.buyers and customers
Section 2 "Financial analysis and planning"
1. Indicators of turnover characterize. ... ... ...
1. solvency
2.business activity +
3.market stability
2. The return on assets indicator is used as a characteristic:
1.profitability of capital investment in the property of the organization +
2.current liquidity
3.capital structures
3. Indicators for assessing business activity are. ... ...
1.turnover of working capital +
2.coverage ratio
3. coefficient of autonomy
4. The turnover ratio of stocks of raw materials and materials is defined as a ratio. ... ...
1.volume of stocks of raw materials and supplies for the period to profit from sales
2.the volume of stocks of raw materials and materials for the period to the volume of sales for the period
3.cost of materials consumed to the average amount of stocks of raw materials and materials +
5. Of the listed components of current assets, the least liquid one. ... ... ...
1.manufacturing stocks +
2. receivables
3. short-term financial investments
4.deferred expenses
6. The ratio of absolute liquidity shows. ... ... ...
1.what part of all obligations the organization can repay in the near future
2. what part of the organization's short-term obligations can be repaid in the near future +
3.what part of the long-term obligations of the organization can be repaid in the near future
7. The critical liquidity ratio shows. ... ...
1.what part of long-term liabilities the organization can pay off by mobilizing absolutely liquid and quickly realizable assets
2. what part of short-term liabilities the organization can pay off by mobilizing absolutely liquid and quickly realizable assets +
3. what part of the organization's short-term liabilities can be repaid by mobilizing all current assets.
8. Current ratio shows. ... ... ...
1.what part of equity capital can the organization cover by mobilizing current assets
2. what part of long-term liabilities the organization can pay off by mobilizing absolutely liquid and quickly realizable assets
3. what part of short-term liabilities the organization can pay off by mobilizing all current assets +
9. If in the composition of the sources of funds of the enterprise 60% is occupied by own capital, then this speaks. ... ...
1. about a sufficiently high degree of independence +
2.on a significant share of the diversion of the organization's funds from direct circulation
3.on strengthening the material and technical base of the organization
10. The accounts payable turnover ratio shows the opportunity. ... ... ...
1.increase in commercial loan +
2.decrease in commercial credit
3. rational use of all types of commercial loans
11. The financial plan is understood. ... ...
1. estimate of production costs
2.planning document, reflecting the costs of production and sales of products
3.planning document reflecting the receipt and expenditure of the organization's funds +
12. The task of financial planning is. ... ... ...
1.development of the financial policy of the organization
2.providing the necessary financial resources for all types of activities of the organization +
3. development of the accounting policy of the organization
13. The process of drawing up financial plans consists of. ... ... ...
1.analysis of financial indicators of the previous period, preparation of forecast documents, development of an operational financial plan +
2.determining the profitability of manufactured products
3.calculating the effectiveness of an investment project
14. Drawing up the financial section of a business plan begins with developing a forecast. ... ...
1.production volumes
2.sales +
3. cash flow
15. With an increase in the volume of sales and other unchanged conditions, the share of variable costs in the proceeds from sales:
1.decreases
2.does not change
3.increases +
16. Liquidity ratios show. ... ... ...
1.degree of profitability of basic operations
2.the ability to cover its current liabilities at the expense of current assets +
3.the presence of current debts at the enterprise
17. The highest level of business risk is observed in enterprises that have. ... ... ... ... ... ...
1.equal shares of fixed and variable costs
2.a large share of fixed costs +
3.high level of variable costs
19. When optimizing the assortment, you should focus on the choice of products with. ... ... ... ... ...
1.the largest share in the sales structure +
2.the minimum value of the total unit costs
3. maximum values of the ratio "margin profit / revenue"
20. With additional production and sale of several types of products, the extremely low price for them is equal. ... ... ... ... ... ... ... per item
1.total costs
2.the sum of fixed, variable costs and profits
3.marginal costs (variable costs) +
21. With an increase in sales from sales, fixed costs:
1.increase
2.not change +
3.decrease
22. The profit margin is. ... ... ... ... ... ...
1.profit net of taxes
2.revenue minus direct costs
3.gross profit before taxes and interests
4.revenue minus variable costs +
23. Critical volume of sales in the presence of losses from sales. ... ... ... ... ... ... ... ... ... ... ... ... ... actual sales proceeds
24. The division of the costs of the enterprise into fixed and variable is made in order to:
1.determining the amount of proceeds required for simple reproduction
2.determination of production and total cost
3. planning profit and profitability +
4.determining the minimum required volume of sales for break-even activities +
25. The cumulative impact of operating and financial leverage measures. ... ... ... ... ...
1.investment attractiveness of the company
2.the measure of the total risk of the enterprise +
3.competitive position of the enterprise
4.degree of financial stability of the company
26. Fixed costs as part of revenue from sales are costs, the amount of which does not depend on:
1. salary of management personnel
2.the depreciation policy of the enterprise
3.natural volume of products sold +
27. The concept of "profitability threshold" (critical point, break-even point) reflects:
1.the ratio of profit from sales to proceeds from sales (excluding taxes)
2.revenue from sales, in which the company has neither losses nor profits +
3.the minimum required amount of revenue to reimburse the fixed costs of production and sale of products
4.the value of the ratio of the profit received to the cost of production
5.Net income of the enterprise in cash required for expanded reproduction
28. With an increase in the natural volume of sales, the amount of variable costs:
1.increases +
2.decreases
3.does not change
29. The ratio of the turnover of working capital characterizes. ... ... ... ... ... ... ... ... ...
1.the ratio of own funds in relation to the amount of funds from all possible sources
2.the size of the volume of proceeds from sales per one ruble of working capital +
3.the ratio of the volume of proceeds from product sales to the average annual cost of fixed assets
30. The calculation of the break-even point involves:
1.total costs and mass of profits
2.fixed costs, unit variable costs, sales volume +
3.direct, indirect costs and volume of sales
31. With an increase in sales proceeds, the share of fixed costs in the total cost of products sold:
1.does not change
2.increases
3.decreases +
32. Variable costs include:
1. piece-rate wages of production personnel +
2.material costs for raw materials and supplies +
3.administrative and management expenses
4.interest on the loan
5.depreciation charges
33. The share of variable costs in proceeds from sales in the base period at enterprise A - 50%, at enterprise B - 60%. In the next period, both enterprises are expected to decrease the real volume of sales by 15% while maintaining basic prices. The company's profit is declining:
1.the same
2. to a greater extent at the enterprise A +
3.Mostly at enterprise B
34. Operating leverage evaluates:
1.costs for products sold
2.a measure of the sensitivity of profit to changes in prices and sales volumes +
3.degree of return on sales
4.revenue from sales
35. The duration of one turnover in days is defined as. ... ... ... ... ... ... ... ... ... ...
1.the product of the balances of working capital by the number of days in the reporting period, divided by the volume of products sold
2.the ratio of the average annual cost of working capital to proceeds from product sales
3.the ratio of the amount of the average balance of working capital to the amount of one-day earnings for the analyzed period +
Section 3 "Methodological foundations for making financial decisions"
1. The financial flow is fully related. ... ...
1.income of loans, issue of new shares, payment of dividends +
2.profit, depreciation, payment of interest on a loan
3. proceeds from sales, profit, obtaining loans.
2. The market value of the securities arises. ... ...
1. at the time of the decision to issue securities
2.in the initial placement of securities
3.in the secondary financial market +
3. The value of a security in the stock market is affected. ... ... ...
1.the organization's need for additional attraction of cash flows
2. rate of return +
3. sales policy of the organization
4. The current yield of the bond with a par value of 10,000 rubles. with a coupon rate of 9% per annum, if the purchase price was 9000 rubles. , is equal to. ... ...
5. If the purchase price of the discount bond was 1000 rubles. , and the redemption price is 1200 rubles. , then its yield is. ... ... ...
6. If the amount of dividends paid is 120 rubles. , and the lending rate is 12%, then the market value of the share will be. ... ...
2. 1000 rub. +
7. Bonds are brought to their owner. ... ...
1. coupon yield +
2.dividends
3.operating income
8. If the amount of expected dividends per share is 50 rubles. , share acquisition price - 1000 rubles. , then the rate of dividend yield of the grafted share will be equal to. ... ...
9. If the current dividend is 30 rubles. per share, the purchase price of the share is RUB 1,500. , the expected growth rate of dividends is 3% per year, then the rate of return on an ordinary share will be equal to. ... ...
10. An indicator characterizing a quantitative measurement of risk is. ... ...
1.coefficient of variation +
2.current profitability
3.standard deviation of the expected return
11. Discounting is:
1.determining the present value of future cash +
2. accounting for inflation
3.determining the future value of today's money
12. Internal rate of return means. ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... the project
1.unprofitability
2. breakeven
3.profitability +
13. When comparing alternative equal-period investment projects, the main criterion should be used:
1. payback period
2. net present value (NPV) +
3.internal rate of return
5.Accounting rate of return
6.the ratio of the net discounted cash income (NPVR)
14. The bank deposit for the same period increases more when interest is applied
1.simple
2.complicated
3.continuous +
15. The annuity method is used to calculate:
1.the balance of the debt on the loan
2.equal amounts of payments for a number of periods +
3.amounts of interest on deposits
16. Leasing is used by the company for:
1.replenishment of own sources of financing
2.Acquiring the right to use the equipment
3. purchase of equipment and other fixed assets +
17. It is advisable to make investments if:
1.their net present value is positive +
2.the internal rate of return is less than the weighted average cost of capital given to finance investments
3.their profitability index is zero
18. The term "opportunity cost" or "loss of profits" means:
1.income that the investor refuses by investing in another project +
2.level of bank interest
3.variable costs of attracting a given amount of funds
4.the yield on government securities
19. When using a long-term loan, the calculation of annual total payments by the annuity method. ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... general loan payments
1.reduces
2.increases +
3.does not change
20. The loan is used by the enterprise for:
1.replenishment of the company's own sources of financing
2. purchase of equipment in case of insufficient own funds +
3.Acquiring the right to use the equipment
Section 4 "Fundamentals of Investment Decision Making"
1. Investments in fixed assets include. ... ... ...
1.buying securities
2.construction of the workshop +
3. work in progress
2. Investment is. ... ...
1.monetary funds allocated for capital construction and industrial consumption
2.investment of capital in the development of the organization for the purpose of making a profit
3.investment of funds, securities and other property that has a monetary value, to make a profit and (or) achieve another useful effect +
3. Simple rate of return shows. ... ...
1.the share of current costs in the organization's cash flow
2.the share of investment costs returned to the organization in the form of net profit over a certain period of time +
3.the share of variable costs in the total costs of the organization
4. The payback period of the project with a uniform cash flow is a ratio. ... ...
1.Net cash flow to the amount of investment costs
2.the total amount of cash receipts to the investment costs
3.free cash flow to the amount of investment costs +
5. The current present value of the NPV project shows:
1.the average profitability of the investment project
2.the discounted amount of profit received from the implementation of the investment project +
3.Discounted value of gross profit from the sale of finished products
1. the level of income from the implementation of the project per 1 rub. investment costs +
2.share of cash receipts
3.share of cash outflows in gross cash flow
7. The indicator of the internal rate of return is this. ... ...
1.the price of capital, below which the investment project is not profitable
2.the average discount rate for raising borrowed funds
3.the discount rate of the investment project, at which the net present value of the project is zero +
8. The modified internal rate of return assumes. ... ... ...
1.Discounting income received during the implementation of an investment project
2.reinvestment of income from an investment project at the cost of capital +
3.Discounting of investment costs required for the implementation of an investment project
9. The uncertainty of future cash flows is caused. ... ...
1.incompleteness or inaccuracy of information on the conditions for the implementation of the investment project +
2.Incorrect accounting for the impact of inflation on the amount of cash flow
3.incompleteness of information on the amount of investment costs
10. Non-standard cash flow assumes. ... ...
1.the prevalence of positive cash flows of inflows during the implementation of the investment project
2.the prevalence of negative cash flows of inflows during the implementation of the investment project
3. alternation in any sequence of outflows and inflows in the process of implementing an investment project +
11. Adjustments to the discount rate are assumed. ... ...
1.introducing amendments to the risk-free or minimum acceptable discount rate +
2.determining the risk-free discount rate
3.reaching the maximum allowable discount rate
Section 5 "Capital structure and dividend policy"
1. The criteria for dividing the organization's capital is. ... ...
1.normalized and non-standardized
2. attracted and borrowed
3. own and borrowed +
2. Affects the volume and structure of equity capital. ... ...
1.organizational and legal form of management +
2.amount of depreciation charges
3.the amount of working capital
3. The advantages of own sources of capital financing are. ... ...
1.high cost of raising in comparison with the price of borrowed capital
2.Ensuring financial stability and reducing the risk of bankruptcy +
3. loss of liquidity of the organization
4. The disadvantages associated with raising debt capital are. ... ...
1.reduction of financial risks
2. low cost of attraction and the presence of a "tax shield"
3.the need to pay interest for the use of borrowed capital +
5. The elements of capital are. ... ...
1.long-term loans and borrowings +
2.the share capital
3. payables
6. If the amount of the dividend paid on preferred shares amounted to 200 rubles. per share, and the market price of the preferred share is 4000 rubles. , then the price of capital formed at the expense of preferred shares is equal to. ... ... ...
7. If the dividends are 300 rubles. per share, the market price of an ordinary share is 6000 rubles. , the annual growth rate of dividend payments is steadily increasing by 5%, the cost of additional issue - 2% of the issue volume, then the price of the source of capital attracted through the additional issue of ordinary shares will be equal to. ... ...
8. If the interest rate for a loan is 10%, the income tax rate is 24%, then the cost of capital raised through loans and borrowings will be equal. ... ...
9. The price of capital is used in the following management decision. ... ...
1.assessment of the need for working capital
2. management of receivables and payables
3.evaluation of the market value of the organization +
10. Dividends on shares are paid from. ... ...
1.revenue from sales
2. net profit +
3. retained earnings
11. The theory of irrelevance of dividends is characterized by the following type of investor behavior. ... ...
1. Shareholders are indifferent to the form in which the distribution of net profit will be carried out +
2. Shareholders give preference to current dividend payments
3. Shareholders give preference to capital gains
12. The "bird in hand" theory is characterized by the following type of investor behavior. ... ... ...
1. Shareholders are indifferent to the form in which the distribution of net profit will be carried out
2. Shareholders give preference to capital gains
3. Shareholders prefer current dividend payments +
14. The following restrictions affect dividend decisions. ... ...
1.the depreciation policy chosen by the organization
2.Legal restrictions +
3.accounting policy of the organization
15. The dividend yield of an ordinary share is an indicator calculated as. ... ...
1.the ratio of net profit, reduced by the amount of dividends on preferred shares, to the total number of ordinary shares (DPS) +
2.the ratio of the market price of a share to earnings per share
3.the ratio of the dividend paid on a share to its market price
16. Dividend Yield Shows. ... ... ...
1.share of the returned capital invested in the shares of the organization
2.the share of the net profit paid by the shareholders of the organization in the form of dividends
3.the proportion of dividend paid on ordinary shares in the amount of earnings per share +
17. Dividend yield is constant in the following dividend payout methods. ... ...
1.method of residual dividend and method of fixed dividend payments
2.the method of constant percentage distribution of profits and the method of fixed dividend payments +
3.the method of payment of the guaranteed minimum and extradividends and the method of fixed dividend payments
18. The source of payment of dividends in accordance with the legislation of the Russian Federation is. ... ...
1.Net profit of the current year +
2.gross profit of the organization
3.income from unrealized transactions
19. The following method of dividend payments helps to smooth out fluctuations in the market value of shares. ... ... ...
1.method of constant growth of dividend payments +
2.the method of residual dividend
3.the method of payment of the guaranteed minimum and extra dividends
20. To obtain reliable information about the profit of a joint-stock company, you should use:
1.the balance of the joint stock company
2.the results of audits
3. profit and loss statement +
21. Source of payment of dividends on preferred shares in case of a shortage of profits from the joint-stock company:
1.emission of bonds
2. additional issue of shares
3. reserve fund +
4.short-term bank loan
5. issue of a bill
22. The effect of financial leverage means:
1.increase in the share of equity capital
2.increase in the return on equity when using borrowed sources +
3.increase in cash flows
4.acceleration of the turnover of current assets
23. Repurchase of own shares is carried out for the purpose of:
1.reduction of the company's liabilities
2. maintaining the market value of the company +
3.Reducing the cost of financing equity capital
24. Financial leverage is calculated as the ratio:
1. equity to debt
2.leveraged capital to equity +
3.profits to equity
25. Additional issue of shares is carried out:
1.in order to maintain control
2.in order to maintain the market rate
3.in order to minimize taxes
4. in order to obtain additional external financing +
26. The net assets of a company are:
1.the equity of the company
2.the value of assets available for distribution among shareholders after settlements with creditors +
3.the difference between equity with the amount of losses
Section 6 "Sources of financing for economic activities"
1. The main methods of financing economic activities:
1. issue of shares
3.all of the above +
2. Venture capital is used:
1.to finance the activities of fast-growing and high-risk firms +
2.for financing state-owned enterprises
3. to finance companies whose shares are traded on the free market on the stock market
3. Upon expiry of the term of the financial lease, the lessee:
1. keeps the rental object at home
2.buys the leased object from the lessor at its original cost
3.can return the leased object, conclude an agreement or redeem the object at its residual value +
4. For a manufacturing enterprise, leasing allows you to:
1. to update fixed assets by spreading costs over time +
2.in the event of equipment failure, terminate lease payments
3.in case of production need to sell the leased object at market value
5. Financial leasing is:
1.Long-term agreement covering the high cost of the leased equipment +
2. short-term rental of premises, equipment, etc.
3. long-term lease, assuming a partial purchase of the equipment.
6. What is not a source of financing for the enterprise:
1.forfaiting
2.depreciation deductions
3.volume of R&D expenditures +
4. mortgage
Section 7 "Working capital management"
1. The organization's cash flow is. ... ... ...
1.the totality of the organization's financial resources
2.the presence of an optimal balance of funds on the current account
3.the amount of receipts and payments of funds for a certain period of time +
2. Cash flow from investment activities - this. ... ...
1.long-term loans and credits
2.advances from buyers
3.income from financial investments +
3. Cash flow from operating activities is. ... ...
1.financial investments
2.payment of receivables +
3.payment of dividends to the owners of the organization
4. The main method for calculating net cash flow is the indirect method. ... ...
1.Net income and depreciation charges +
2.the cash balance and changes in assets and liabilities
3.Liquid cash flow and sales revenue
5. The complete production cycle of the organization is determined. ... ...
1.the period of the turnover of work in progress, the period of the turnover of stocks of finished products, the period of the turnover of receivables
2.period of turnover of inventories, period of turnover of work in progress, period of turnover of stocks of finished goods +
3.period of turnover of finished goods stocks, period of turnover of work in progress, period of turnover of accounts payable
6. The financial cycle is. ... ...
1.the time interval between the date of payment for its obligations to suppliers and the receipt of money from buyers +
2.period during which the receivables are fully repaid
3.period during which the payables are fully repaid
7. Permanent working capital. ... ...
1. shows the required maximum working capital for the implementation of uninterrupted production activities
2. shows the average value of working capital for the implementation of uninterrupted production activities
3. shows a minimum of current assets for the implementation of uninterrupted production activities +
8. The conservative working capital management policy is characterized. ... ...
1.a high proportion of current assets in all assets of the organization
2.low share of short-term credit in liabilities or its absence +
3.average period of working capital turnover
9. Aggressive working capital management policy is consistent. ... ...
1.average level of short-term credit as part of liabilities
2.low share of short-term credit in liabilities or its absence
3.high share of short-term loans in all liabilities +
10. What is the relationship between schedule line size and order placement costs?
1.what bigger size the delivery schedule, the lower the total operating costs for placing orders +
2.the smaller the shipment size, the lower the total operating costs for placing orders
3.the larger the shipment size, the higher the cumulative operating cost of placing orders
11. The amount of total accounts receivable depends on. ... ... ...
1.amounts of accounts payable
2.volume of sales of goods on credit +
3.Volumes of sales of goods
12. Accounts receivable are considered normal provided that. ... ...
1.The debt will be repaid in 14 months
2.The debt will be repaid in 12 months +
3.The debt will be repaid in 16 months
13. In the process of managing accounts receivable, the following issues are resolved. ... ...
1.control over the growth of labor productivity and cost reduction
2.profit planning and optimization of the organization's inventory
3.control over the structure of accounts receivable in the context of debtors and assessment of its liquidity +
Section 8 "Special sections of financial management"
1. The crisis is. ... ...
1.chronic insolvency of the organization +
2.the excess of accounts payable over accounts receivable
3.use of loans for the acquisition of working capital
2. Which of the following crises characterizes the crisis of regularity of occurrence?
1.short-term
2.catastrophic
3.Cyclic +
3. Which of the following crises characterizes the crisis according to its sources of origin?
1.spontaneous +
2.painful
3.short-term
4. Signs of a potential crisis are. ... ...
1.decrease in the amount of free cash flow +
2.destructive impact of the external environment
3.quasi-normal state of the organization
5. Signs of the latent stage of the crisis - this is. ... ...
1.the absence of real symptoms of the crisis
2.decrease in the amount of free cash flow +
3.decrease in profitability of products and organization
6. The factors causing the crisis and related to the "distant" environment of the organization are. ...
1.the rate of economic growth in the country +
2. management
3.financial
7. Symptoms of a crisis situation are. ... ...
1.presence of overdue receivables
2.the surplus of own working capital
3.decrease in income from the main activity of the organization +
8. An indicator characterizing the entry of an organization into a crisis zone is this. ...
1.the breakeven point of products +
2.the amount of variable costs
3.margin profit
9. External signs of the organization's insolvency are. ... ...
1.inability to comply with creditors' claims within two months
2.inability to fulfill creditors' claims within three months +
3.unsatisfactory balance sheet structure
10. The bankruptcy procedure is carried out for the purpose. ... ...
1.expansion of sales
2.reducing costs
3.payment of all types of debts of the organization +
11. The real bankruptcy of the organization occurs when. ... ...
1. loss of capital +
2.low profitability
3.increase in production costs
12. Intentional bankruptcy of the organization occurs when. ... ...
1. late payment of debt obligations
2.use of the organization's funds for the personal enrichment of its management +
3.Intentionally misleading creditors in order to obtain installment payments
13. Reorganization bankruptcy procedures include. ... ...
1.compulsory liquidation
2.voluntary liquidation
3.pre-trial rehabilitation +
14. E. Altman's two-factor model is based on. ... ...
1.the ratios of current liquidity and financial dependence +
2.Rates of turnover and current liquidity
3.Rates of return and capital structure
15. The U. Beaver coefficient is based on. . . .
1.current ratio and capital structure
2.Net income, amortization and liabilities +
3.profitability and asset turnover
1.the ratios of current liquidity and profitability
2.the ratios of financial independence and asset turnover
3. liquidity and financial independence ratios +
18. The goal of anti-crisis management from the perspective of financial management is. . . .
1.maximization of profits and optimization of the product portfolio
2. restoration of financial stability and solvency +
3.Reduction of accounts payable and receivable of the organization
19. The subsystem of anti-crisis management is formed by. . .
1.strategic management, reengineering, benchmarking +
2.tactical management, crisis management, marketing
3.human management, restructuring, insolvency management
20. The formation of the "bankruptcy estate" of the organization involves. . .
1.restructuring
2.risk management
3. bankruptcy management +
21. Indicators for monitoring property status are. . .
1.Power utilization factor
2.depreciation rate of fixed assets +
3.market value of the organization
22. Indicators for monitoring the assessment of the financial condition of an organization are. . .
1.profit +
2.volume of production and sales of products
3.the size of non-current assets and their share in the total amount of assets
23. Prevention of bankruptcy includes. . .
1.full mobilization of internal financial reserves
2.carrying out the reorganization of the organization
3.Restoring financial stability and ensuring financial balance +
24. The principles underlying crisis management are. . .
1.conducting continuous monitoring of the financial condition of the organization
2.differentiation of the symptoms of an uncontrollable crisis according to the degree of their danger to the viability of the organization +
3. "cutting off the excess", leading to a decrease in the size of the current external and internal financial commitments in the short run
25. The following measures of financial recovery correspond to the stage of restoration of the organization's solvency. ... ...
1.acceleration of collection of accounts receivable, use of factoring +
2. prolongation of short-term loans and borrowings
3.acceleration of the turnover of working capital
26. Forms of financial recovery are. . .
1.rolling short-term accounts payable
2.optimization of the assortment policy of the organization
3.vertical merging of organizations +
27. Reorganization of an organization without preserving its legal entity is. .
1.transfer of the organization to rent +
2.Conglomerate merger of the organization
3. restructuring
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Short-term borrowing is used by companies of all types and sizes. Short-term debt is borrowed funds that are repayable within a year, used to finance operating costs.
Sources of short-term financing:
Trade credit. This is the most common source of short-term financing. It is a loan that a supplier of products or materials provides to a buyer. Registration of this transaction can be made by agreement or orally. The forms of trade credit are open credit and promissory note. Open credit (open account) allows the buyer to purchase goods with a deferred payment. This is an informal agreement whereby the buyer receives the product before paying for it. A promissory note is a written promise of a buyer to pay a specified amount of money to a supplier by a specified date.
Loans from financial institutions. An enterprise can apply to a commercial bank or other financial institution for a short-term loan. Loans are secured and unsecured. A secured loan is a loan that is guaranteed against some value that the lender receives if the borrower goes bankrupt. For example, the security may be the company's own property. Various forms of such security can be distinguished: accounts of debtors, inventories, and other other property. A loan for accounts of debtors implies that the debts to the company from the side of its clients on open accounts are used as collateral. Accounts receivable can be sold to a third party finance company.
This procedure is called factoring. When a firm borrows against inventory, the bank accepts a receipt from it that if the firm does not pay the debt, then its inventory will go to the creditors. Short-term loans are also issued against the security of any movable ("liquid") property, such as cars and other equipment. An unsecured loan is given without any collateral. In this case, the lender relies on the profitability of the business or its reputation. As a guarantee, the lender requires the borrower to keep a certain amount of money in a bank account (compensation balance). Another type of unsecured loan is a "line of credit". It represents the maximum amount that the bank agrees to issue to the company within a certain period of time.
A long-term loan is a debt that has a maturity of more than one year. The most common type of long-term loan is a mortgage, that is, the use of some property (usually real estate) as collateral. Basically, the source of long-term loans are commercial banks but can also be provided by insurance companies and pension funds. As risk increases in the long term, interest rates on long-term loans are high.
Also, the company can resort to long-term lease with the option of purchase (leasing). Leasing is most often used when purchasing various equipment, means of transport, etc.
The company can receive the required amount of money from various depositors if it issues its bonds. They represent a debt obligation of the enterprise to pay the holder of this bond its value plus interest. The par value of a bond is called its denomination. A bond usually has a maturity of ten years or more. Bonds can also be secured and unsecured. Secured bonds are guaranteed by the property.
Unsecured bonds (debentures) are guaranteed only by the reputation of the company. The interest rate on bonds depends on the reliability of the enterprise. The less reliable company usually offers higher bond interest rates. Bonds of such companies are called "junk" bonds. And bonds of companies that fall into an attractive investment category are the most reliable.
There are also serial and fixed-term bonds. The debt on serial bonds is repaid in series at regular intervals, and the term bonds expire at the same time. To facilitate the repayment of their debt, companies create a special repayment fund, from which a certain amount is allocated annually to pay off the debt on bonds. If the company reserves the right to redeem bonds ahead of time their maturity, such bonds are called callable. The company can also negotiate the possibility of redemption of bonds for its shares. Such bonds are called convertible bonds.
The owners of the company's shares are legally its co-owners, owners. Each of the shareholders has the right to participate in the company's profits. A shareholder, upon entering a share, receives a share certificate, i.e. a document that confirms the ownership of the shareholder. The notional par share price is called face value. The aggregate of all shares that were launched for sale is called the authorized capital. The profit is distributed to shareholders in the form of dividends. The company can issue two types of shares: preferred and ordinary.
Holders of preferred shares are entitled to receive dividends first. However, preferred shares are not "voting" shares, i.e. their owners do not play any role in making decisions about the company. Holders of ordinary shares receive dividends last, but they have the right to participate in the affairs of the company, for example, in choosing the board of directors, making decisions on major acquisitions, etc. The price of preferred shares is usually stable, but the price of common shares can fluctuate sharply, and the holder of an ordinary share, under favorable circumstances, can sell it at a much higher price than he acquired.
Funding for a business is usually done in a variety of ways. At the same time, the higher the investor's risks, the higher the income expected by investors.
Government funding
The overwhelming majority of Russian enterprises are guided by funding from the state budget. Firstly, this is the most traditional source of funding, and, therefore, an attempt to obtain funding in the regional administration or in the government is more familiar and does not require new knowledge and skills from management. Second, it is much more difficult to prepare a project for a private investor than for the state: the government's requirements for disclosing information and preparing investment projects are formal rather than professional.
Thirdly, the state is the most loyal creditor, and many enterprises do not return loans received from it on time without fear of being declared bankrupt. If your company really has the ability to obtain direct government funding, guarantees or tax credits, then this should be used. The greatest chances of receiving funding from the state budget have infrastructure, social, defense and scientific projects, which, due to objective reasons, are not able to access funding from commercial sources.
Leasing, or financing from equipment suppliers
Acquisition of assets by installments is available for companies with good financial condition and positive development trends. In this case, the asset acquired by the enterprise serves as security, which becomes the full ownership of the enterprise only after its cost has been fully paid. This method of financing is mainly used when purchasing equipment.
Vendor financing is also very widespread. Many manufacturers, as a mechanism to stimulate demand, offer their customers the purchase of equipment in installments, after paying an initial advance payment.
Commercial loans
This is the most common way to finance businesses. Financing conditions in banks are different. At the same time, the most important factor in the bank's decision to grant a loan was and remains the availability of liquid collateral or reliable guarantees.
Bond loan
Raising capital by placing bonds on the financial market is undoubtedly an attractive way to finance an enterprise. Especially from the point of view of business owners, as in this case there is no reallocation of property. However, an enterprise planning to issue and place bonds must have a stable financial position, good development prospects, and the bond loan must be secured by the company's assets.
Preference shares
Holders of preferred shares have some advantages over ordinary shareholders - for example, priority in the distribution of profits or higher priority in the settlement of obligations in the event of a liquidation of the enterprise. However, preferred shares do not give their owners the right to participate in the management of the enterprise.
Consequently, in the event of negative tendencies, the investor does not have the ability to influence the management decisions taken by the enterprise management. At the same time, selling preferred shares to other investors is also problematic. Thus, preferred shares are a risky instrument for an investor. An exception may be preferred shares of the largest and most reliable Russian companies.
Ordinary shares
The overwhelming majority of Russian enterprises are characterized by an unstable financial position, lack of liquid collateral and the ability to provide reliable guarantees for loans. In addition, while many businesses have many years of history and technological experience in the industry, they are often at a very early stage of development from a business point of view. However, some of them, in the case of attracting the necessary capital, acquire significant growth potential and, therefore, may be attractive to an investor.
The only real source of financing for such enterprises is risk capital. Ordinary shares of enterprises are purchased only by those investors who are ready to share the business risks with the existing owners of the enterprise, do not require collateral and guarantees. At the same time, investors are guided by the following criteria: growth potential, management's ability to ensure business growth, financial transparency and the ability to influence decisions, as well as the ability to exit the project through the sale of shares on the stock market or a strategic investor.
Possible sources of capital for industrial enterprises include the following:
1. Venture funds and private equity funds, which form an investment portfolio from a small number of specific enterprises, for a period of 3 to 6 years, with the subsequent exit from the project.
2. Strategic investors, industrial companies or financial institutions specializing in certain industries.
3. Investment brokers who carry out private placement of shares of enterprises among individual and institutional investors.
4. Investment banks providing project financing.
36. New instruments of short-term financing.
New instruments for short-term financing
Let us briefly describe such techniques as insurance, forward and futures contracts and repo transactions, which allow the company to provide the necessary working capital and, to a certain extent, reduce the risk of financial and economic activities when making financial decisions related to the future.
Insurance. There are two types of insurance: compulsory and optional. The first is provided for by law, and the costs for it are written off to the cost of production. The second type of insurance is voluntary, and the necessity and expediency of its use is determined by the degree of risk associated with this operation.
Forward and futures contracts are the most common hedging techniques. They represent securities and are traded on stock exchanges.
Futures are one of the types of forward contracts. Compared to forward contracts, futures have a number of distinctive features:
The forward contract is "pegged" to the exact date, and the futures contract is "pegged" to the month of execution;
There are usually many participants in transactions, so sellers and buyers are not tied to each other;
Futures are freely traded on stock exchanges;
Changes in prices for goods and financial instruments specified in contracts are carried out daily throughout the entire period until their execution.
REPO transactions are agreements to repurchase securities. A direct REPO transaction provides that one of the parties sells another package of securities with the obligation to buy it back at a predetermined price. Buybacks are made at a price that is higher than the original price. REPO transactions are carried out mainly with government securities and relate to short-term transactions - from several days to several months.
37. Classification of methods of accounting and analysis of the impact of inflation.
One of the fundamental principles of accounting in most countries is the principle of recording accounting items at purchase prices. In conditions of stable prices, the application of this principle is quite justified. However, during periods of sufficiently high inflation, reporting based on initial estimates may give a distorted picture of the financial condition and performance of the enterprise.
The attitude to inflation as an objective economic process has been ambiguous for many years. Until 1936, the dominant thesis was that inflation is an exclusively destructive force. This thesis was refuted by J. Kane-som, who argued that inflation has a huge positive potential, since it depreciates money, makes the process of their accumulation pointless. Thus, consumption is stimulated, and inflation turns into the most important factor in the development of the economy. On the contrary, the absence of inflation leads to
accumulation of money, their immobilization, and under certain conditions can cause an economic crisis.
However, it must be admitted that inflation has a significant impact on the reliability and relevance of accounting data. Not all types of assets and liabilities are equally affected by it. For example, if an enterprise during the inflation period had free unused cash and accounts payable, then the effect of the influence on these accounting items is exactly the opposite. In the first case, the company incurred indirect losses, since the purchasing power of the monetary unit decreased, in the second __
indirect income, since the debt will have to be repaid in the future with cheaper money, and the amount of debt will remain unchanged.
As noted above, inflation is the process of decreasing the purchasing power of money. And since the monetary measure is the basis of accounting, its direct consequence for it is the loss of comparability of data - the shoes bought yesterday turn out to be cheaper than the laces for them bought today, that is, any connection between the assessment of values and real life... So, if there are materials on the balance sheet worth 12 million rubles, and their price at the moment is 14 million rubles, then, leaving the initial estimate on the balance sheet, the company creates a hidden reserve of 2 million rubles, i.e. source of funding hidden from taxation.
Keeping the original and residual values in the balance under inflation conditions leads to the fact that the accumulated amortization amount becomes symbolic, because what the lathe cost yesterday may be worth a box of matches today.
Further, in the event of waste, shortages and embezzlement, the perpetrators are happy to reimburse the book price or the residual value of fixed assets in order to sell the stolen goods at high market, speculative prices, because the principle of asset valuation at cost, as laid down in traditional accounting, in conditions of inflation provokes theft ... The aforementioned sharply intensifies during the periods of privatization of state property. It is quite obvious that if privatization proceeds on the basis of old prices distorted by inflation, then this is plundering of state property, and it is very pleasing to the new owners who receive millions of values for a pittance. And finally, traditional methods of assessing an asset do not give any idea about the real security of loans, about the solvency of the enterprise and do not allow to determine the economic potential of the company.
Since the end of the First World War, many scientists and practitioners have been struggling with the problem: how to make accounting real in conditions of inflation? A lot of proposals have accumulated, in many countries a certain practice has already developed in this regard. It should be noted that interest in the problem of accounting for inflation periodically increases and decreases. As soon as the rate of inflation in economically developed countries increased slightly in the mid-70s, the national accounting associations immediately drew attention to this problem. It is no coincidence that it was at this time that the first international standard for accounting for the impact of inflation (standard No. 15) was developed, which was introduced in November 1981. The approaches to accounting and analysis of the impact of inflation known in world practice can be systematized in the form of the following scheme (Fig. 11.1).
All supporters of revaluation were divided into two groups: those who insisted on reassessing only the reporting, and those who proposed to reassess every fact of economic life, i.e., emphasized the need to reassess current accounting data, because the revaluation of reporting took it away from the General Ledger and registers accounting; on the contrary, in the second case, their complete identity was ensured. So, the principle of revaluation of values was proclaimed, which in all cases became desirable, and in conditions of inflation - inevitable.
Let's consider the main options for revaluation in the context of inflation.
Press conferences; 3) implementation of event and sports marketing (participation in events organized by third parties); 4) implementation of event-driven marketing (organization of special events, often on an exclusive basis); 5) product placement in a motion picture, TV or radio program, use of the product during conferences, government meetings and ...
Decisions, transforming it into a team. We are talking about such functions as planning, forecasting or foresight, organization, regulation, coordination, stimulation, control. Financial management as a form of entrepreneurial activity means that financial management cannot be a purely bureaucratic, administrative act. It's about creative activity, ...
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Short-term funding means that funds will be returned no later than one year later. Traditionally, short-term financing is used in business to cover seasonal and temporary fluctuations in the condition of funds. It can also be used to pay long-term business needs or interest on funds raised on a long-term basis. For example, short-term financing can provide additional working capital or bridge financing for a long-term project.
Comparison of short-term financing with long-term financing reveals both the advantages and disadvantages of each method. As a rule, short-term financing is easier to negotiate, it is usually less expensive and provides the borrower with more flexibility. On the other hand, short-term interest rates are more volatile than long-term ones; refinancing is often needed, and outstanding payments can adversely affect the creditworthiness of a borrower who is experiencing liquidity problems.
Short-term financing is usually classified into two main categories: ad hoc and contractual. Spontaneous funding is determined by the invoices that arise in the day-to-day operations of the firm.
Another category of short-term financing consists of contractual sources of financing: a bank loan and unsecured and secured loans. This funding is not spontaneous, as it must be agreed on on a formal basis.
The main problem with short-term financing is the choice of different short-term financial instruments, and this is solved by comparing variable costs, availability, flexibility and timing.
Commodity credit is the largest source of short-term resources for a business. In a developed economy, most buyers do not need to pay for goods at the time of delivery and are given a short grace period. Since providers are more liberal in extending credit than financial institutions, companies, especially smaller ones, rely more heavily on this form of financing.
Typically, a merchandise loan is extended according to three types of arrangement:
open account;
bills of exchange payable;
accepted trade bills.
An open account is the most commonly used type of merchandise credit. Under this arrangement, the buyer does not sign a formal promissory note showing the amount owed. The seller sends the goods to the buyer and sends an invoice stating the goods shipped, the total amount owed and the terms of sale. The seller usually extends the loan based on a study of the buyer's creditworthiness. The account opening credit appears in the buyer's balance sheet as a receivable.
Bill of exchange for payment - signed by the buyer and is proof of his debt to the seller. A bill determines the payment of an obligation before some specified future date. This arrangement is used when the seller wants the buyer to formally prove the debt. A bill of exchange, for example, can be issued when a customer's open account becomes payable.
An accepted trade bill is an arrangement that provides for the formal recognition of a debt by the buyer. Under this arrangement, the seller draws up a bill of exchange for the buyer, ordering the buyer to pay the bill of exchange before some future date. The goods will not be shipped by the seller until the buyer accepts the bill of exchange. When accepting a bill of exchange, the buyer determines the bank in which the bill of exchange will be paid when it becomes payable. From this time on, the bill of exchange becomes an accepted trade bill.
The seller extends the credit to the buyer by specifying the so-called net period, which determines the period of time during which payment can be made. The “net 30” condition means that the bill or invoice must be paid within 30 days.
Under the “net cash discount period”, the seller, in addition to extending the loan, offers a discount if the invoice is paid during the first half of the net period. The terms "2/10, net 30" indicate that a 2% discount is provided if the invoice is paid within 10 days, later (from 11 to 30 days) the buyer must pay the full amount.
Thus, in accordance with the terms of sale, the buyer is not always obligated to pay the full cost of the merchandise credit. The use of this method of financing implies certain financial costs, which depend on the production cycle. Therefore, it is necessary to be able to calculate such costs under two circumstances, when the company: does not take a discount when paying in cash, but pays on the last day of the net period, pays the invoice after the net period.
There are certain costs of unused opportunities arising from the decision not to take the discount whenever possible. Suppose the terms of sale are "2/10 net 30" and the firm does not take the cash rebate, but pays on the last day of the net period. For a 1,000 ruble bill, that would mean using RUB 980 for 20 days (from the 11th to the 30th day), but you have to pay RUB 20 for this privilege (discounted discount). The cost, in the form of an annual percentage of not taking a discount when paying in cash, can be set as follows:
_ Percentage discount 365 days
Annual interest rate = x
100 percent discount (payment date - discount period)
In our case, the cost of the annual interest would be:
Annual interest rate = --- x = 37.24%
YO-2 20
This means that refusal to pay for the goods within 10 days in order to use this amount within 30 days is tantamount to taking a bank loan at 37.24% per annum.
As we can see, merchandise credit can be very expensive when a payment discount is offered but not accepted.
Payment after the net period (delayed payments) is also additional short-term financing. The resulting benefits to the firm must be weighed against the additional costs: late payment penalties or interest that may be imposed depending on industry practice; possible deterioration in the credit rating; possible deterioration of the firm's ability to obtain a loan in the future; a possible increase in the asking price of the sale by the seller as a result of the extension of the credit.
In general, it is possible to defer some invoices for payment after the end of the net period without serious consequences. The supplier may agree to accept a deferral of payment if the risk of debt hopelessness is negligible, or in the case of seasonal purchases or reduced sales, etc.
The entrepreneur must have a good understanding of the consequences of a commodity loan and additional costs as a result of the decision to waive a discount or a decision to pay after the net period. In addition, the entrepreneur must compare the benefits of commodity finance with other alternative short-term forms of finance.
The main advantage of commodity finance is that it is readily available because, unlike other forms of short-term finance, there is no need to negotiate the terms of the loan with the lender. This means that the firm can avoid wasting time in meeting the need for funding, i.e. between the time the need arises and the time when they are available. Commodity finance is very flexible and can avoid strict payment schedules. With a well-known image, an entrepreneur can also avoid restrictions on their operations and precautions from the lender. Suppliers are often more lenient with financial problems when implementing projects than bankers or other lenders. Finally, for a number of projects there are no alternative sources of short-term financing, except for commodity financing.
It should be borne in mind that the main source of funds is sales, and for projects directly related to sales, commodity financing would not only not worsen the position of the company, but, on the contrary, would make it more stable. For example, for a supermarket chain, commodity financing is excessive, since the sale period with the correct organization of trade is much less than the net period.
But despite the benefits of a merchandise loan, many firms are using other forms of short-term financing to take advantage of discounts on merchandise purchases.
The main forms of contractual financing are financial market loans and short-term loans.
Forms of financial market credit: short-term commercial bill; bank financial bill; short-term loans; credit agreements; overdraft;
loan renewal agreement; operating loans; installment loans; discounts on trade bills;
loans guaranteed by receivables;
stock-guaranteed loans;
factoring.
A short-term commercial bill is an unsecured short-term contractual promissory note traded in the financial market. Some corporations may also issue a "bank-backed" commercial bill. The bank provides a letter of credit for a fee, guaranteeing the investor that the company's obligations will be paid.
Bank financial bill - a short-term promissory note, according to which the bank, accepting it, promises to pay the holder a nominal amount at the due date.
Sources of short-term loans and borrowings are commercial banks and financial companies operating on a contractual basis. Borrowers must apply for a loan and lenders can provide the requested amount under certain conditions.
To apply for a bank loan, a firm must have sufficient assets and good liquidity and / or a business plan that meets the bank's requirements. When an agreement is reached, the borrower usually signs a document stating that the borrower agrees to repay the loan on time. The invoice payable can be paid on the due date or in installments.
Loans bring income to the bank in the form of an interest rate and a base rate of interest - the lowest interest rate on short-term loans from the bank. Banks charge at a base rate only from their most creditworthy customers; for other borrowers, higher interest rates are used or are denied altogether. Bank loans can be classified into two categories: unsecured loans; secured loans.
In most cases, financial companies do not offer unsecured loans simply because borrowers who deserve an unsecured loan can obtain a loan at a lower cost from a commercial bank. Therefore, we will only consider unsecured loans from commercial banks.
Unsecured loans are a form of debt that is not guaranteed by collateral in the form of specific assets. This type of loan is recommended for creditworthy companies to finance projects with fast-growing cash flows.
For this reason, they are usually regarded as “automatically redeemable”, as the assets acquired with the money from the income generate sufficient cash flows to pay off the loan. The disadvantage of this type of loan is that, due to its short-term nature, it implies a higher interest rate than a secured loan.
Proof of debt on an unsecured loan can be a promissory note signed by the borrower, which indicates the interest, along with how and when the loan will be repaid. Unsecured loans can be renewed by agreement to renew the loan or on an ongoing basis.
When using loan agreements, the bank agrees to provide money to the borrower up to a certain amount, depending on the bank's assessment of the borrower's creditworthiness. The contract is concluded for up to 1 year and can be renewed annually. The advantages of loan agreements for projects are obvious - easy and immediate access to funds, which makes it possible to receive as much money as needed and repay immediately as there is free money. However, as a rule, opening a credit line under an agreement to finance new projects is available only if the borrower's financial condition is good, the bank has been working with the borrower for a long time and reliable guarantees are provided.
Current account loans (overdraft) - an agreement according to which payment documents can be issued up to a specific maximum amount. They are often extended year after year, and are effectively a form of medium-term funding.
A loan renewal agreement is a formal legal obligation to renew a loan up to a certain maximum amount within a stated period of time. The borrower is required to pay a commission on the unused portion of the revolving loan in addition to interest on any loan amount.
Operating loans as a short-term financing instrument are especially convenient if there is a need for short-term funds for one specific purpose. The contractor can receive loans from the bank to complete the construction and when the facility under construction is ready, he will return the loan to the bank. The ability of the borrower to meet its obligations is of paramount importance.
An installment loan implies monthly payments that include both the repayment of part of the loan and the payment of interest. When the bulk of the loan is repaid, refinancing can be made at a lower interest rate. The advantage of this type of loan is that it can be tailored to meet seasonal or peak funding needs.
Trade bill discounts are derived from the following series of actions. A manufacturer selling goods on credit writes a bill of exchange to the buyer. The buyer signs the bill of exchange himself or hands it over to the bank in order to accept it. The manufacturer sends the bill to his bank, and the bank accepts it for a fee. The interest rate varies depending on the terms of the bill and the usual level of interest rates in the local financial market.
If the credit rating of the borrower is low, the bank will be able to provide money only under security guarantees, that is, under some form of collateral. Collateral can take many forms, including inventories, marketable securities, or fixed assets.
In secured loans, lenders have two sources of loan repayment: the firm's free cash and the value of the collateral. The disadvantage of a secured loan is a decrease in production flexibility.
There are three main ways to secure loans: a guarantee in the form of accounts receivable, a guarantee in the form of inventories, and a guarantee in the form of property.
Accounts receivable are one of the most liquid forms of a firm's assets, and therefore a desirable collateral for a short-term loan. In evaluating a loan request, the lender must analyze the quality of the receivable, the percentage at which he wishes to lend and the amount of the receivable. Therefore, receivables of medium and small size will require higher administrative costs per ruble of the loan from the lender. The loan guaranteed by the receivables can be either on an unannounced or on a notifiable basis, depending on whether or not the firm's clients are notified that their accounts are pledged.
Loans guaranteed by inventories are issued if the goods in inventories have the following features: they can be sold; non-perishable; standardized; having a fast turnover; not subject to rapid wear;
can be sold not only by the sales organizations of the company; have stable prices and trading costs.
Usually, the amount issued against the security of inventories does not exceed 75% of the value of these inventories.
Documented inventory financing includes changing loan collateral, warehouse receipt and receipt of property in trust. In the case of variable loan collateral, the lender's guarantee is the cumulative stock excluding specially designated assets.
With a warehouse receipt, the lender receives remuneration in the form of the borrower's inventories stored in a special storage warehouse. Stocks serving as collateral for a loan, at the request of the lender, can be stored on a specially designated area by the debtor. The debtor has access to the goods, but must constantly account for them to the creditor. The collateral is released only when the borrower pays off part of the loan.
Upon receipt of the property in trust, the lender has ownership of these goods, but frees them up for the borrower to sell on behalf of the lender. As the goods are sold, the borrower transfers the money to the lender. An example of using a receipt in receipt is financing a car dealer. The disadvantage of a receipt in receipt of property is that a receipt must be given for certain items.
Factoring involves the sale or transfer of ownership of a receivable to an intermediary who acquires the invoices as equity. The receivables are sold without recourse, which means that the seller is not responsible for any receivables not collected by the intermediary. As a result of the sale to an intermediary, the receivable is removed from the seller's balance sheet.
Factoring includes two different intermediary services, each with a separate price list for commission fees. In the first service, called urgent factoring, the intermediary provides credit appraisal and collection services and takes on the credit risk and the risk of losing bad debt when buying invoices. The reseller may refuse invoices offered at the time of sale. The firm receives payments for the sales receivable each month on the average due date of the intermediary's invoices. Reseller's commissions range from approximately 0.77 to 2%.
The second service is discount factoring. With this arrangement, the firm selling the receivables can receive funds from the intermediary before the average due date. Funds available are equal to the net invoice after cash discounts, minus discounts to cover settlement requirements, income, and other discounts. Interest is charged daily and no compensation balances are required.
The advantages of factoring include: quick receipt of funds, reduced costs, since a long credit check is not required, the use of financial advice, and better financial performance. But the existing drawbacks reduce the effectiveness of factoring: the high cost of services and a bad impression left by the customer due to the change in the owner of the receivable.
The key issues in a full analysis of alternative funding sources are: comparison of their costs, flexibility, timing, availability and efficiency of use.
The following factors influence the cost of a short-term loan: established interest rates, compensation balances and commissions for the undrawn part of the loan. Interest rates are determined based on negotiations between the borrower and the lender. This rate is determined taking into account the following parameters: the client's creditworthiness, the level of cash balances and the presence of other activities carried out by the borrower with the bank.
There are two main methods for calculating interest rates: interest is paid in addition to the loan; interest is deducted from the initial loan amount.
With a loan of 15,000 rubles. and the amount of interest paid for the year] 800 rubles. The interest rate in the first case will be equal to:
1800 
15000
The second method is used when discount bills, when issuing loans secured by property and similar forms of lending.
Many lenders use offset balances - interest-free account balances that commercial banks may require the customer to keep with the bank in direct proportion to either the amount of funds borrowed or the amount of the agreement. Their influence affects the growth of the real cost of borrowing.
For the above example, if the requirement is that 1500 rubles should be kept in the account, the percentage will be:
1800
15000-1500
Commission fee is the amount usually required upon renewal of the loan agreement or the provision of any other services by the bank. On the other hand, the bank itself may pay a commission to the borrower if the latter meets certain conditions based on preliminary agreements (for example, the account balance is kept within certain limits).
When choosing the forms of short-term financing, one should take into account: the financing period, the availability of financing, the flexibility of financing and the impact of financing on the results of activities.
The funding period is the most important aspect when choosing a combination of short-term funding.
Funding availability is also important. The lower the creditworthiness of the firm, the fewer sources of short-term financing are available to it.
Flexibility in terms of short-term financing shows the firm's ability to pay off the loan, as well as the ability to extend or even increase it. With short-term loans, the firm can repay the debt if there are available funds and, thus, reduce interest costs. In factoring, the loan is given only when necessary and interest costs are paid only when necessary. With a short-term commercial bill, the firm must wait until the due date to repay the debt.
Flexibility shows how easily a firm can increase borrowing on a short-term basis. With a credit arrangement or revolving loan, it is sufficient to simply increase borrowing if the maximum limit has not been reached. With other forms of short-term financing, the firm is less flexible.
Finally, the extent to which the firm's assets are influenced by financial decisions must be considered. With secured loans, lenders obtain a security interest over various assets of the firm. This limits the firm's future funding options. When a receivable is sold under a factoring agreement, the firm is stripped of one of its most liquid assets, thus diminishing its creditworthiness from the point of view of other creditors.
Below is a list of factors influencing the choice of a source of short-term project financing: cost;
influence on the assessment of creditworthiness;
risk. You must consider the reliability of the source of funds for future borrowing;
restrictions. Some lenders may impose restrictions such as a minimum working capital requirement;
flexibility. Some lenders wish to work more with the borrower than others,
for example, periodically adjust the amount of funds required;
expected financial market conditions;
rising inflation;
profit and liquidity;
stability of the firm's actions.
