One of the most important elements ensuringthe successful operation of any company, are the assets of the enterprise. They represent the property of the firm, reflected in the financial statements in monetary terms.
All the assets of the enterprise can be divided into largegroups: permanent and basic. The first category includes movable and immovable property, intangible assets, fixed and working capital, and so on. The main or, as they say, non-current assets of the enterprise are characterized by a long period of implementation, which will be required in case of necessity of their sale.
The assets of the enterprise include working capital. They, unlike the previous category, can be converted into money for a fairly short period of time. For example, these include finished goods in a warehouse, materials and raw materials necessary for production activities, debts of debtors, securities issued for a short period, as well as cash on deposit and settlement accounts.
Non-current assets of the enterprise have a number ofadvantages, for example, reliability, as they ensure uninterrupted income generation even during serious financial difficulties, because they can be leased or transferred to leasing. In addition, they are less affected by inflationary fluctuations. However, do not forget about the presence of shortcomings, because non-current resources with the active development of technological progress quickly wear out and require replacement or modernization, and therefore additional costs. As you know, the organization must study the market situation and be able to adapt to any of its changes, non-current assets are very difficult to maneuver.
But current assets have the capacity torestructuring, so they can easily adapt to any changes in the economy. In addition, they are characterized by a high level of liquidity. Finished goods in general can serve as a means for quick settlement with customers. The current assets of the enterprise are imperfect, they identify a number of shortcomings. First, the costs of maintaining the unused portion of them are high. Secondly, they are exposed to the inflation factor, that is, there is a threat of impairment, due to high inflation rates in the market. In this regard, we can highlight the third point: the riskiness of some financial assets.
The most important indicator, reflecting the financialthe state of the company, is the net asset size, through which it is possible to calculate how productive the enterprise is and how much it is provided by its own resources. In order to calculate the net assets of the enterprise, it is necessary to find the difference between the sum of the asset and the balance sheet. This indicator is calculated annually in the order established by the current legislation.
So, when calculating the amount of net assetsall non-current resources are used, that is, the result of the first section of the balance sheet, as well as current assets, which relate to the second section. As an exception, it is possible to allocate a buyout by the company of its own shares from shareholders for the purpose of cancellation or re-sale to other buyers, as well as arrears in the form of a shortage of funds for a mandatory contribution to the statutory fund of the joint-stock company.
Moreover, the size of net assets must be strictlypositive, and their amount is higher than the authorized capital of the company. This requirement allows the internal and external users of the reporting to visually prove that in the course of its activity the firm was able to multiply the contributions of the owners of the shares, and thus, it was profitable. By law, it is allowed to reduce the level of net assets relative to the size of the authorized capital only in the first years of activity, since during this period the main production is financed at the expense of own capital.