The current liquidity of the enterprise is determined by the corresponding ratio, also called the coverage ratio. To determine it is necessary to use the data of the balance sheet for the reporting period. This indicator allows you to determine whether the company is able to withstand the rapid changes in the market.
Instructions
Step 1
Determine the value of the current assets of the enterprise. To do this, refer to the balance sheet in form No. 1 and deduct from line 290 "Current assets" the values of line 230 "Long-term accounts receivable" and line 220 "Debt of founders for contributions to the authorized capital". If the listed factors are not present in the enterprise, then it is enough to take the values of the total for section 2 of the balance sheet.
Step 2
Clean out the amount of the organization's current short-term liabilities. To do this, it is necessary to deduct reserves for future expenses (line 650) and deferred income (line 640) from line 690 of the balance sheet in form No. 1, which reflects the total for section 5. Alternatively, you can simply add lines 610, 620, and 660.
Step 3
Calculate the current liquidity ratio, which is equal to the ratio of current assets to current short-term liabilities.
Step 4
Find the current ratio without using the balance sheet. To do this, you need to calculate the amount of the organization's funds in cash and on the current account, securities, receivables and inventories. Divide the resulting value by the amount of credit, loans and payables.
Step 5
Analyze the obtained value of the coverage ratio and characterize the current liquidity of the enterprise. The larger this ratio, the higher the organization's solvency indicator. Depending on the industry and the field of activity of the company, it is considered optimal if the liquidity is in the range from 1 to 3. A lower value indicates a high financial risk associated with the inability to pay off current accounts. If the coefficient is higher than 3, then it is necessary to revise the attitude to the capital structure, since it is used irrationally.
