财务预警外文文献.docVIP

Financial risks and its early-warning system 1,the description of financial risks Beaver(1996) defines financial risk as:bankruptcy, defaulting cumulative preference share and debt. He thinks that,the deterioration of an enterprise depends on the following factors : ①payment at maturity; ②the cash fllow of the enterprise; ③profit rate to net worth; ④the capacity of obtaining capital inflow. Also Altman(1968) defines financial risk as a listed company that has been defined to be bankrupt by law. The lack of payment ability which was caused by the technological failure in found management . Generally these troubles are temporary and less important ,and are usually able to remendy , through various methods such as asking for a compromise through consultation ,and put off the the due to pay debts .In a word , if the problems are permanent , the enterprise may have to face the bankruptal liquidation ; however , if the problems are temporary ,the company may have a chance to get out of the tight spot, and turn a loss into a pofit ! 2,the relationship between financial risks and its early-warning system. Financial risks is not only associated with the companys survival and development , but also the interests of the investors,and the creditors. With the intensive development of Chinas market economy and the rapid development of the capital market, listed companies are threatened by financial risks. Which means that without a precaution system the corporate may get into a tight spot. As a matter of fact , it has become a great concern comprhesively by investors ,creditors, and some monitoring institutions of securities market . The early-warning system is available to for governors to knows more about the causes for financial crisis, so as to prevent financial risks . This early-warning system seems to operate after the symbol of financial risks . On contrary it has already listed all the possibilities of reasons for financial crisis and its monitoring data .It is a pre