MODERN ANALYTICAL INSTRUMENTS FOR CONTROLLING THE ENTERPRISE FINANCIAL PERFORMANCE

Abstract

It was grounded, that analysis of financial performance allows discovering opportunities to improve the enterprise financial condition, implements effective control over revenue and expense metrics, makes economically sound decisions based on the calculation results. The features of generating and accounting profit are distinguished, which should be taken into consideration in the course of analysis of the financial performance of business entities that do not always ensure the accuracy of information. In particular, it was found that displaying the fact of sales at the time of goods shipment distorts the financial condition (there may be situations where the entity is financially stable but insolvent); even a profitable enterprise can show the signs of bankruptcy, if its funds are invested in low-liquid assets, the accounts payable are not paid off, and the profits are not used efficiently; the income accrued throughout the entity’s operation is never equal to the amount of income accrued for each reporting period (this is due to revaluations and changes in accounting policies); the income according to the accounting data is not identical to the real (from the economic point of view) financial performance of the entity. A model of profit factor analysis, which takes into account the shortcomings of the previous model and which is based on the use of direct-costing is considered in detail. The peculiarity of this model is that the cost of production is calculated and planned only in part of the variable costs, and fixed costs at the end of each month are written off to the financial performance of the entity main activities. It is established that the current regulatory framework for income generating, accounting and analysis leads to the distortion of the real financial performance. Therefore, the concepts of economic, accounting and tax profit should be distinguished, and their relationships should be taken into account. It is proved that the results of profit and profitability analysis, including the quality of analytical studies and the rationality of management decisions made on their basis, depend on organising separate accounting for fixed and variable costs, implementing the budgeting system by the subject. In spite of the fact that in the conditions of management accounting, the method of factor analysis of profit becomes mathematically complicated, its results become more transparent from the economic point of view, and the possibilities of using information in carrying out strategic prospective analysis of financial performance expand.