Analyzing and Managing Financial Sustainability of the Company in Turbulent Environment

Abstract

Until now, the debates around financial sustainability analysis, estimation and management have converged towards two main issues. The first is about financial analysis practice based on different sources of information, comparative value of financial and managerial accounting. The second is about institutional restrictions that factually replace the theory of analysis and management. In this paper, we explore an underdeveloped topic by linking these two issues: how the methodology of economic analysis (with reference to financial sustainability analysis) is developed regarding claims of different groups of stakeholders. First, we extend the term “financial sustainability” putting together financial and nonfinancial indicators and metrics. We regard this as an answer on present-day challenges of turbulent environment, the turbulent nature of economic activity. Secondly, we suggest a system of indicators of financial sustainability analysis. It includes service quality and management quality indicators, financial ratios and other indicators and operating risk indicators. Finally we introduce the main goal of financial sustainability analysis – to search, discover and mobilize the reserves (working balances), disclosed and implicit opportunities of further development. We put forward an idea of socio-economic nature of these opportunities.

DOI: 10.5901/mjss.2015.v6n4p138