Open AccessCOMPARATIVE ANALYSIS OF THE METHODS OF FINANCIAL AND ECONOMIC EXAMINATIONS TO DETERMINE INSOLVENCY
Author(s) -
Jūlija Liodorova,
K. Mamikonyan,
O. Markina
Publication year - 2019
Publication title -
teorìâ ta praktika sudovoï ekspertizi ì krimìnalìstiki
Language(s) - English
Resource type - Journals
eISSN - 2708-5171
pISSN - 1993-0917
DOI - 10.32353/khrife.2.2019.27
Subject(s) - insolvency , legislation , solvency , latvian , normative , the republic , russian federation , accounting , business , political science , finance , economy , economic policy , economics , law , market liquidity , linguistics , philosophy , theology
The article describes the methods of financial and economic examinations to determine the insolvency of a company in the Baltic countries, Republic of Armenia, Ukraine, Republic of Belarus, the Russian Federation and Republic of Kazakhstan. The signs of insolvency regulated in legislation of the countries, and international requirements for the validation of expert methods are presented in the article. The authors present the results of a comparative analysis of the considered methods for assessing insolvency and results of testing methods based on data of annual reports of focus group of five Latvian bankrupt companies.
The research has shown that the expert methods of all eight countries are based on a normative approach — comparing the calculated financial ratios with their normative value. In Ukraine, Republic of Belarus, the Russian Federation and Republic of Kazakhstan, the financial ratios and their normative values are approved in the legislation of the countries. In the Baltic countries and Republic of Armenia, these ratios and their values are developed in approved expert methodologies. The method of «net assets» is also used to assess the solvency of large companies.
The test results showed that the methods of the countries reviewed are applicable in practice and give a similar assessment of the solvency of companies as a whole. More similar results present the methods of the Baltic countries, Ukraine and Republic of Belarus. The results of the methods of Republic of Armenia, Kazakhstan and the Russian Federation are more similar to each other, but slightly differ from the previously listed group of countries.
The authors demonstrated the ability to validate the expert methods, which is necessary to use an expert conclusion on the assessment of insolvency as an evidence base in another country.