Financial diagnosis consists of a number of instruments and methods which help to evaluate a company’s financial situation and performances. The financial diagnosis identifies the favourable and unfavourable factors which will affect the company’s future activity. The purpose of financial...

Companies, especially nowadays, are characterized through great mobility, fast circulation of capital, occurring in their chase for profit. In this context, companies look for alliances, economical and political assistance. These objectives can materialize through merging of companies. The...

Financial diagnosis is a part of a company’s general diagnosis. The role of the financial diagnosis is to establish the situation of the company at a given time, to see if it is viable, to help the decision-makers to take the best measures to continue or cease the activity, or to sell, buy or...

A company’s manager has to create and maintain a healthy internal control system. An efficient internal control system implies the implementation in the company of risk management. Each company, but also each individual, who tries to attain certain objectives, establishes the activities which...

The analysis based on the balance sheet tries to identify the state of equilibrium (disequilibrium) that exists in a company. The easiest way to determine the state of equilibrium is by looking at the balance sheet and at the information it offers. Because in the balance sheet there are elements...

The analysis of the financial balance is based on the data from the balance sheet and is related to the correlation between financial resources and financing needs, the company’s liquidity and solvency, and also to the rotation speed of assets and liabilities from the balance sheet. If the...

Under the current circumstances, companies must access European funds by making some projects that lead either to the acquisition, construction or creation of jobs. To this end, they must have previous positive results, a strong financing capacity and compile a viable business plan. Financing...

The analysis of profitability indicators is an activity that should preoccupy all companies. Profitability does not mean only obtaining profit. A company is competitive if the ownership equity grows (the shareholders’ money), the company has a profit that is comparable to that of other...

In many countries, the primary financial statements are based on the historical cost, without taking into account the changes that occurred in the general level of prices or the increase in specific prices of assets held, excepting those cases in which the fixed assets and financial investments...

Accounting treatments represent the methods used by a company to apply its own accounting policies. Accounting treatments can be divided into two categories: basic accounting treatments and alternative treatments. Stocks represent the quantities of material resources, half-finished goods,...