Open AccessFINANCIAL MANAGEMENT OF ASSET-LIABILITY RATIO OF SMALL- AND MEDIUM-SIZED ENTERPRISES IN DYNAMIC NONLINEAR SYSTEM
Author(s) -
Ling Zhang,
Bahjat Fakieh,
Li Shang
Publication year - 2022
Publication title -
fractals
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.654
H-Index - 44
eISSN - 1793-6543
pISSN - 0218-348X
DOI - 10.1142/s0218348x22400643
Subject(s) - liability , business , finance , asset (computer security) , asset turnover , equity ratio , financial ratio , return on equity , return on assets , stock exchange , computer science , computer security
The purposes of this paper are to optimize the financial management methods of small- and medium-sized enterprises (SEMs) and deeply explore asset-liability ratio’s relevant theories. A medium-sized manufacturing enterprise’s financial conditions and the influencing factors of enterprise’s asset-liability ratio are researched by a dynamic model with two-way effects and the enterprises’ dynamic nonlinear simulation model. Meanwhile, capital injection’s impacts on asset-liability ratio are explored. The results show that different industries’ enterprise asset-liability ratios vary. The real estate enterprises’ asset-liability ratio is 61.35%, the highest, and the cultural communication industry is the lowest, 35.62%. Meanwhile, the asset-liability ratios of energy industry, manufacturing industry, and the wholesale and retail industry are also relatively high. The larger the enterprise’s scale, the higher its asset-liability ratio, long-term liability ratio, current liability ratio, and loan financing. The proposed simulation software performs satisfactorily in its application. The simulation system’s analysis shows that the target enterprise’s asset-liability ratio is gradually increasing, and its return on equity and capital turnover rate is decreasing, reaching the critical bankruptcy point in the 36th month. With a 20 million CNY capital injection, its asset-liability ratio decreases significantly, and return on equity increases steadily. In the 49th month, it resumes normal operations. The results provide a useful reference for subsequent research on enterprises’ asset-liability ratios and SMEs’ financial management.