Market Dynamics of Ensuring Financial Security and Sustainable Development of Enterprise

Abstract

The paper substantiates the need to study the level of financial security of an enterprise. To study the dynamics of financial security of an enterprise we consider a system-dynamic model and simulation of distributed financial flows of a representative industrial enterprise under the impact of random factors, which reflect the threats affecting its financial security. Information on the financial statements of firms is often confidential, which leads to the need to develop a simulation model of a firm’s activities and to conduct experimental research based on the enterprise’s size and reserve fund ensuring its financial security. During simulation experiments, three scenarios for metallurgical enterprise (pessimistic scenario, optimistic scenario and most probable scenario) were investigated, and it was established that for at least half of the cases, an enterprise needs to form a reserve fund to maintain autonomous operations and ensure the necessary level of financial security. JEL Codes: C1, C9, D33