Profit, being an absolute indicator, does not show the level of efficiency of the organization and does not allow for a comparative analysis of the performance of economic entities that differ in scale of production, capital, product range, etc. For this purpose, a relative indicator is used, which is in general view the ratio of effect to cost is called profitability.

Profitability as economic category expresses economic relations between business entities regarding the effectiveness of the use of capital factors. As an economic criterion, profitability characterizes efficiency financial and economic activities of any economic entity relative to all others, regardless of the size and nature of economic activity.

The methodology for determining profitability involves a variety of forms of expression of the numerator and denominator. This leads to the calculation a large number profitability indicators, which can be systematized on the basis of various classification features - by subject of activity, by type of resources, by type of effect, by phases of activity, etc.

The system of profitability indicators, which allows assessing the effectiveness of an economic entity, includes (at least) the following coefficients:

1) profitability of products (products) - is defined as the ratio of profit from sales of products (works, services) to the total cost products sold.

where Prp- profit from sales (from the sale of products);

PSRP- total cost of goods sold.

The profitability of products characterizes the amount of profit per ruble of costs for its production and sale. The indicator of profitability of products can be calculated both for the entire commercial product of the organization, and for its individual types, on the basis of which a decision is made to change the range: expanding the production of some types of products and removing others from production. On the basis of the product profitability indicator, planning is also carried out for the release of new types of goods.

In addition to the above calculation methodology, the profitability of products can be calculated on the basis of the net profit indicator, and without taking into account selling and management expenses, that is, on the basis of production costs;

2) profitability of sales (profitability of turnover, profitability ratio) - is defined as the ratio of profit from sales to revenue from sales according to the formula

where GRP- net proceeds from the sale of products.

This indicator reflects the share of profit in revenue and characterizes the profitability of the organization's main activities. Profitability of sales is also considered as a generalizing indicator of the financial condition of an economic entity and influences the decisions of investors on the advisability of investing in this organization. The dynamics of profitability of sales depends on changes in prices, sales volumes and costs of production and sales of products. So, for example, an increase in the profitability of sales may be due to an increase in product prices or a decrease in costs, and vice versa. The change in profitability of sales can also be explained by the difference in the rate of change in product prices and production costs. Therefore, it is believed that this profitability ratio characterizes the pricing policy of the organization.

Factor analysis of profitability of sales allows you to make a decision about the choice of ways to improve the efficiency of the organization (increase in profits either by reducing costs or by expanding production and sales).

The indicator of profitability of sales can be calculated on the basis of net profit and is called in this case the net profit ratio. Profitability of sales in terms of net profit shows the amount of profit remaining at the disposal of the organization, per unit of products sold;

3) return on assets (return on investment) - is defined as the ratio of profit to the average value of the organization's assets according to the formula

where Pch- net profit;

BUT- the amount of assets.

As an indicator of the effect, depending on the task set in the evaluation of efficiency, one or another indicator of profit can be used. In most cases, the assessment is carried out by profit before tax (according to the balance sheet), by net profit, by profit from sales.

Return on assets characterizes the effectiveness of the use of funds invested in the activities of the organization and evaluates the profitability of their investment. This indicator reflects the amount of profit attributable to the ruble of all spent economic resources. In addition, the return on assets (calculated on the basis of the net profit indicator) determines the financial potential of an economic entity and the possibilities for its development.

The return on assets (and, accordingly, the efficiency of the use of assets) increases in the event of an increase in profits, a decrease in the need for basic and working capital ah or with the simultaneous influence of both factors. Analysis of the profitability of assets allows you to identify the main factors affecting the profitability of activities, the directions of their influence, as well as determine the measures necessary to improve the effectiveness of the use of existing assets.

,

where Koa - asset turnover ratio.

Asset turnover is defined as the ratio of sales proceeds to the average value of assets for the analyzed period and shows the number of turnovers made by the organization's assets over the period, thus characterizing the efficiency of their use. The formula shows a directly proportional dependence of the return on assets from the profitability (profitability) of sales and the velocity of assets.

Usually, in the course of analyzing the profitability of assets, additional profitability ratios are calculated current assets and profitability of non-current assets;

4) profitability equity- shows the amount of net profit that the organization receives per monetary unit of invested own funds, characterizing the effectiveness of their investment.

This indicator is of particular importance for the owners of the organization, since they are interested in the most profitable investment of their funds and receiving the greatest income from this. Between the value of the indicator and the amount of income received by the owners, there is a proportional relationship. The higher the return on equity, the big income owners can receive, therefore, the return on equity reflects the degree of rationality and attractiveness of investing in this area of ​​activity, has a decisive influence on the value market value enterprises. This indicator is called the criterion of profitability of the organization.

The calculation of return on equity is carried out according to the formula

where SC- equity.

The relationship of return on equity with return on assets and return on sales can be represented by the following formula:

where Msk is the equity multiplier. It shows how the organization's assets increase with the growth of its own capital per unit (one ruble, one percent, etc.), and also characterizes the capital structure of the organization. The multiplier is defined as the ratio of assets to equity capital of the organization;

5) return on borrowed capital - reflects the feasibility and effectiveness of the use of borrowed resources, which must be taken into account when developing a policy for attracting borrowed funds:

where ZK is borrowed capital.

Debt capital includes long-term and short-term liabilities of the organization, the use of which is carried out on a returnable and paid basis. This necessitates a comparison of the costs associated with their receipt and the effect of their use.

In addition to the above profitability indicators, which are among the basic ones, the organization can count on many others. A specific list of coefficients is determined based on the goals and objectives of the analysis, the specifics of the organization's activities.

Basic methods of profit and profitability planning

Profit planning is integral part financial planning and plays an important role in ensuring the effective operation of the organization.

Economically reasonable definition profit allows you to correctly assess the volume financial resources, investment opportunities, replenishment working capital ensure the timeliness of settlements with the budget, banks, business partners, and employees. The implementation of the dividend policy and the formation of the market value of the organization depend on the amount of profit.

When planning the profit of the organization are taken into account and general provisions on planning and specific features of activities, forms of ownership, organizational and legal forms, conditions of offsets, etc. In the course of planning, factors are taken into account that will affect the activities of the enterprise in the planned period - changes in production volumes, changes in the assortment, changes in prices for production resources, on the organization's products, etc.

Profit planning includes:

Profit formation planning;

Planning the use of profits.

These are both independent and interrelated sections of the planning process.

The object of planning is the balance sheet profit and its main elements: profit from the sale of products, profit from the sale of property and property rights, profit from non-sales operations.

Methods for planning financial results are not currently regulated, but the following main methods are used in economic practice:

1) direct counting method;

2) analytical method;

3) normative method;

4) programmed factorial method;

5) economic and mathematical method.

1. Method of direct counting- the simplest and most accurate method, especially convenient when the product range of the enterprise is not too wide.

The disadvantages of the method include the difficulty of determining the impact on the amount of profit of various economic factors.

Besides, in modern conditions it is quite difficult for an enterprise to accurately determine the volume of sales of products and it is not always possible to set sales prices in advance. These considerations are the main obstacle to the application of this method.

Planning stages:

1) determination of the planned amount of profit from the sale according to the formula

,

where GRP– net revenue from sales of products

srp- total cost of goods sold

Also, the profit from the sale can be determined by the formula

Etc = ,

where Цpi - selling price of the i-th type of product;

Ci- the cost of the i-th type of product;

Ki- the number of sales units of the i-th type of product.

If it is impossible to directly determine the volume of sales of products or with a sufficiently wide range of products, the profit on sales can be determined based on the profit from the production of products according to the formula

Prp \u003d Pong + Ptp - Pokg

where Pong- profit in the balance of unsold products at the beginning of the planned year;

Ptp- profit from the release of marketable products for the planned year;

POkg- profit in the balance of unsold products at the end of the planned year;

2) profit planning in carry-over balances can be carried out on the basis of the profitability of the reporting year;

3) determination of the planned amount of profit from the sale of property is carried out by direct account based on the estimated sale price of the property scheduled for sale and its initial (residual) value. A list of property to be sold is preliminarily drawn up;

4) the determination of the planned amount of profit from non-operating operations can be carried out on the basis of the ratio of profit from non-operating operations and the balance sheet profit of the enterprise that has developed in the reporting year.

When determining the ratio, only non-operating income and expenses associated with the normal conditions of economic activity, which are of a permanent nature, are taken into account;

4) determination of the planned amount of profit of the balance sheet is made according to the formula

Pbal \u003d Prp + At + Air,

where At– planned profit from the sale of property and property rights;

air defense- planned profit from non-operating operations.

2. Analytical method- applied when a wide range products, as well as, if necessary, determining the impact of economic factors on the amount of profit.

The main principle used in profit planning by this method is an orientation towards the level of costs or the level of basic profitability based on an analysis of the organization's activities for previous periods.

2.1 Profit planning according to the level of basic profitability of manufactured and sold products (works, services) is carried out in the following order. Planning stages:

1) calculation of basic profit based on actual reporting data, adjusted for the result of random factors, etc.;

2) definition of basic profitability:

where pvsp- profit on the release of comparable products;

FROM- production cost of comparable products;

3) all comparable products of the planned year are recalculated for the cost of the reporting year based on the estimated percentage of change

That = ,

where That- output of products of the planned period at the cost of the reporting year;

T- release of products of the planned period at the cost of the planned year;

ΔС%- estimated change in cost in percent;

4) the profit from the release of comparable products of the planned year is determined:

Ptps = ;

5) the planned profit is determined in the carry-over balances of unsold products - based on the basic profitability. At the same time, the balances of unsold products at the end of the planned year should be recalculated to the cost of the reporting year;

6) the planned profit from the sale of property and property rights is determined - according to the methodology used in planning by the direct account method;

7) the planned profit from non-sales operations is determined according to the methodology used in planning by the direct account method;

8) the planned profit from the sale of incomparable products is determined by the direct calculation method as the difference between the selling price and the cost of sold incomparable products or on the basis of the average level of profitability;

9) the planned balance sheet profit is determined:

Prp \u003d Prps + At + Air Defense + Prpn;

10) the influence on the amount of profit for the release of comparable products of economic factors is determined:

a) changes in the product range (based on changes in the average level of profitability):

Δ P due to ass-ta \u003d T about × ΔR,

where ∆R- change in the average level of profitability in percent;

b) change in the qualitative structure of products (based on changes in the grade factor):

Δ P due to quality \u003d T o × K grade . ,

where K grade. - change in the grade factor;

c) changes in the cost of production:

Δ P due to s / s \u003d T o - T \u003d;

d) changes in product prices:

Δ P due to prices = ,

where T i is the volume issue i products for which prices have changed;

Δ C i - price change for i-th product in rubles.

2.2 In the second option of profit planning by the analytical method - by the level of costs per 1 ruble of manufactured and sold products (works, services), profit calculations are carried out similarly to the calculation of basic profitability. But instead of the indicator of basic profitability, the indicator of basic costs is used.

At the same time, the profit on commodity output is planned equally for both comparable and incomparable products, based on the amount of costs per one ruble of the cost of production:

Ptp \u003d TP opt * (1 - Z) ,

where TPopt- commercial products in wholesale prices (sales prices);

W- the cost of 1 rub. marketable products at wholesale prices (sales prices).

3. Normative method- is the basis for the introduction of a commercial budgeting system and is used if the organization has established norms and standards for spending resources on specific types of products and on the centers of responsibility of organizations.

In this case, the estimate (budget) of financial results is developed on the basis of the cost estimate of sales, the cost estimate of the period and the estimate of sales volumes. Information on other income, other expenses and the amount of income tax is also added to it.

An estimate of financial results can be drawn up for each profit center - individual divisions or structures for which it is possible to correlate the income they receive with the expenses incurred. The estimate of financial results for the whole organization is the result of adding up all such estimates, and the main task of this estimate is to provide a given level of financial results both in absolute terms (profit) and in relative terms (profitability). If the allowable minimums for profit or profitability are met, the estimate is approved, if not, it is subject to revision according to private estimates in order to identify reserves for improving financial results for each individual profit center. Monitoring of the estimate of financial results is carried out in accordance with the compliance of the actual values ​​of profit and profitability with the planned ones. If deviations are identified in this estimate, the control actions will be directed not at adjusting the indicators of the estimate of financial results, but at adjusting the estimates that provide it.

4. Programmed factorial method of profit and profitability planning- one of the most promising in modern conditions, providing for the planning of profit and profitability for several options for the economic activity of organizations. As a result, it profit figures and profitability determine the choice of management option, i.e., these indicators become initial, target. Planning stages:

1) calculation baseline for the previous year on the basis of the reporting ones, adjusted for the conditions in force at the beginning of the planned year and freed from random factors;

2) setting goals for economic activities for the planned year.

At this stage, the company determines the target options for managing the next year. The goals of the enterprise should determine the groups of factors that will affect the profit of the planned year. The main aggregated factors:

Change in the volume of sales of comparable products in comparable prices;

Change in the cost of comparable products;

Release of new incomparable products;

Change in prices for the company's products;

Change in prices for purchased inventory items;

Changing the valuation of fixed assets and capital investments of the enterprise;

Change in wages;

Change in profit from other sales and non-operating transactions;

Change in the assets of the enterprise;

Change in the ratio of own and borrowed capital;

Structural shifts in production and costs.

All these factors, if necessary, can be supplemented and detailed;

3) forecasting inflation indices. The organization determines the estimated inflation indices for the planned year on its own, based on own information on the movement of prices and the structure of costs and products. The main inflation indices reflect:

Changing the "selling prices" for products, works, services of the enterprise itself;

Change in "purchase prices" for inventory items purchased by the enterprise;

Change in the cost of fixed assets and capital investments according to the balance sheet estimate;

Change in mean wages due to inflation

4) calculation of planned profit and profitability by options.

The profit is calculated on the basis of the base value of the book profit for the previous year, which is adjusted by the value of the factors established in the second planning stage. With this planning method, the influence of each factor on future profits (including inflationary factors) is clearly visible.

5) the choice of the optimal management option is carried out taking into account the obtained indicators of profit and profitability. In addition, planned indicators of profit and profitability can be the main criteria for optimizing the planning decisions of the organization.

The presented method is based on the current reporting, does not require a significant increase information base, with the exception of monitoring inflation indices. This also speaks in favor of this method and makes it promising.

5. Economic and mathematical method. It is used only in large or super-large organizations where it is possible to use a large accounting information base, computer science and computer programs.

Target profit indicators are used by the organization when calculating the target sales volume, optimizing taxation, forming a dividend policy, etc. Therefore, profit planning is of interest not only for the organization, but also for its investors, creditors, business partners and is one of the determining factors for a successful commercial activities.

Questions for self-control

1. Expand the value of profit in the activities of the organization in a market economy.

2. Describe the main functions of profit.

3. What are the main factors influencing the formation and distribution of profits.

4. Describe the main types of profit and their relationship.

5. Describe the concept of profitability.

6. What are the main profitability ratios.

7. What is the relationship between return on assets and return on sales?

8. What are the advantages of the analytical method of profit planning?

9. What are the main methods of profit planning.

10. What is the relationship between profit and profitability indicators?

In the article we will consider the turnover of working capital as one of the most important indicators for assessing the financial condition of an enterprise.

Working capital turnover

Working capital turnover (English Turnover Working Capital) is an indicator related to the company and characterizing the intensity of the use of working capital (assets) of the enterprise/business. In other words, it reflects the rate of conversion of working capital into cash during the reporting period (in practice: year, quarter).

The formula for calculating the turnover of working capital according to the balance sheet

Working capital turnover ratio (analogue: fixed asset turnover ratio, K ook) - represents the ratio of sales proceeds to the average working capital.

The economic meaning of this ratio is an assessment of the effectiveness of investing in working capital, that is, how working capital affects the amount of sales proceeds. The formula for calculating the turnover ratio of working capital on the balance sheet is as follows:

In practice, the analysis of turnover is supplemented by the coefficient of fixing working capital.

Coefficient of fixing working capital- shows the amount of profit per unit of working capital. The calculation formula is inversely proportional to the working capital turnover ratio and is as follows:

- shows the duration (duration) of the turnover of working capital, expressed in the number of days required for the payback of working capital. The formula for calculating the turnover period of working capital is as follows:

Analysis of working capital turnover. Regulations

The higher the value of the turnover ratio of working capital, the higher the quality of working capital management in the enterprise. In financial practice, there is no single generally accepted value of this indicator; the analysis must be carried out in dynamics and in comparison with similar enterprises in the industry. The table below shows different kinds turnover analysis.

Video lesson: "Calculation of key turnover ratios for OAO Gazprom"

Summary

Working capital turnover is the most important indicator business activity enterprise and its dynamics directly reflects the financial stability of the enterprise in the long term.

Profitability indicators are relative characteristics of the financial results and performance of the enterprise. They measure the profitability of an enterprise from various positions and are grouped according to the interests of the participants in the economic process, market exchange. Profitability indicators are important characteristics of the factor environment for the formation of profit and income of the enterprise. For this reason, they are indispensable elements. comparative analysis and assessment of the financial condition of the enterprise. When analyzing production, profitability indicators are used as an instrument of investment policy and pricing.

The main profitability indicators can be grouped into the following groups:

Indicators calculated on the basis of profit (income);

Indicators calculated on the basis of production assets;

Indicators calculated on the basis of cash flows.

The first group of indicators is formed on the basis of calculating the levels of profitability (yield) according to profit indicators, which are defined in the enterprise's statements. For instance:

These indicators characterize the profitability (profitability) of sales. With methods factor analysis the impact of price changes is determined

on products and their cost (material costs) on the change in the profitability of products.

Let us designate the profitability of products of the base and reporting period through and , respectively. There is by definition:

where - profit from the implementation of the reporting and base period, respectively;

Sales of products (works, services), in accordance with the reporting and base period;

Cost of products (works, services), in accordance with the reporting and base period;

Δ R- change in profitability for the analyzed period.

The influence of the price change factor on products is determined by calculation (by the method of chain substitutions):

Accordingly, the impact of the cost price change factor on the profitability change will be:

The sum of factor deviations will give the total change in profitability for the period:

The second group of indicators is formed on the basis of calculating the levels of profitability depending on the change in the size and nature of the advanced funds: all production assets of the enterprise; invested capital (own funds, long-term liabilities); share (own) capital. For instance:

The discrepancy between the levels of profitability for these indicators characterizes the degree of use by the enterprise financial leverage to increase profitability: long-term loans and other borrowed funds.

These indicators are very practical. They serve the interests of various stakeholders. For instance; the administration of the enterprise is interested in the return (profitability) of all production assets; potential investors and creditors are interested in return on invested capital; owners and founders are interested in stock returns, and so on.

Each of the listed indicators is easily modeled by the method of identical transformations by factor dependence. For example, consider this obvious dependency:

This formula reveals the relationship between the profitability of sales and return on assets (an indicator of turnover production assets). The economic meaning of the connection lies in the fact that the formula directly indicates ways to increase profitability: with a low profitability of sales, it is necessary to strive to accelerate the turnover of production assets.

Consider another factorial model of profitability.

As you can see, the profitability of own (equity) capital depends on changes in the levels of profitability of sales, the velocity of circulation of total capital and the ratio of equity and borrowed capital. The study of such dependencies is of great evidentiary value for assessing the financial condition of the enterprise, assessing the degree of skill in using financial leverage to improve the results of its activities. From this dependence it follows that, for other equal conditions the return on equity increases with an increase in the share of borrowed funds of the enterprise in the composition of total capital.

Consider an example (tab. 5.3).

Table 5 .3

Analysis of the level of profitability of production

The level of profitability for the reporting year amounted to 91.6%, and for last year- 135.8%, then the profitability decreased by 44.2 points.

The influence of factors that influenced the change in the level of profitability is determined on the basis of the following calculations (by the method of chain substitutions):

1) an increase in the share of profit per hryvnia of sold products led to an increase in the level of profitability by 56.1 points (191.9 - 135.8), where

2) an increase in the capital intensity of products, that is, a decrease in the return on assets of fixed production assets led to a decrease in profitability by 89.6 points (102.3 - 191.9), where

3) an increase in the coefficient of fixed working capital, that is, a slowdown in their turnover, led to a decrease in the profitability of production by 10.7 points (91.6 - 102.3).

So, the overall decrease in profitability by factors is 44.256.1 - 89.5 - 10.7), which corresponds to a general change in the profitability of production compared to the data for the previous year.

The third group of profitability indicators is calculated on the basis of net cash inflow. For instance

The latest indicators give an idea of ​​the company's ability to fulfill obligations to creditors, borrowers and shareholders in cash in cash. Profitability, calculated on the basis of cash inflow, is widely used in developed countries market economy. It is overwhelming because operations with cash flows is an essential sign of an intensive type of production, a sign of the "health" of the economy and the financial condition of the enterprise.

Factor models of profitability reveal the most important causal relationships between indicators of the financial condition of the enterprise and financial results. Therefore, they are an indispensable tool for "explanation" (assessment) of the current situation.

Factor models of profitability are also models for predicting the financial stability of an enterprise, managed. The need to foresee the nearest and distant prospects development is an urgent task for enterprises. Production growth rates depend not only on demand, sales markets, enterprise capacities, but also on the state of financial resources, capital structure and other factors.

The most important constraint on the planned growth rate of an enterprise is the rate of increase in its own capital, which depends on many factors, but primarily on the profitability of sales (factor X1), the turnover of all capital (balance sheet currency - factor X2), the financial activity of the enterprise to attract borrowed funds (factor X3) profit distribution rates for development and consumption (factor X4).

Thus, the growth rate of equity, characterizing the potential of the enterprise to expand production, can be represented by a multiplicative model of the relationship of the listed factors:

where Y- equity growth ratio (equal to the ratio of profit allocated for accumulation to average annual cost own capital);

The model reflects the effect of tactical (X1, X2 factors) and strategic (X3, X4 factors) financial decisions. Properly Produced price policy, the expansion of sales markets lead to an increase in sales and profits of the enterprise, increase the speed of circulation of its capital. At the same time, an irrational investment policy and a decrease in the share of borrowed capital can reduce the positive result of the first two factors.

This model is remarkable in that it can easily be extended to include new factors. Moreover, such important indicators of financial condition as liquidity, turnover of current (mobile) assets, the ratio of term liabilities and capital fall into the field of view of the manager.

An extended model for calculating a sustainable growth rate is as follows:

where y - equity growth rate;

but - capital structure (the ratio of the balance sheet to average cost own capital);

b- the share of term liabilities in the capital of the enterprise (the ratio of the amount of term liabilities (current liabilities) to the balance sheet currency);

from- current liquidity ratio (ratio of current assets to current liabilities);

d- turnover of current assets (ratio of net sales to current assets);

e- financial result from the sale of products per unit of sales (profitability of sales) (the ratio of net profit to net sales);

f- the rate of distribution of profits for accumulation (the ratio of profits allocated to investments to the amount of net profit).

The practical application of sustainable growth models is recommended in enterprise development planning, taking into account the risk of bankruptcy.

It is known that one of the criteria for bankruptcy is an unsatisfactory balance sheet structure, which is determined by the current liquidity ratio, the current asset security ratio own funds and the amount of debt in equity. If we take all these coefficients at the normative level, and the profit distribution rate for accumulation equal to 1.0, then the optimal sustainable growth rate will be 0.5 return on current assets, or 0.05 return on equity working capital.

These are very important conclusions from the analysis of the formulas. But it's not the numbers that matter. The important thing here is that the rate of sustainable growth depends on very unstable parameters or factors. After all, the value of current assets, i.e. working capital and own working capital is very mobile and depends on many factors: the size of the business; industry affiliation of the enterprise, that is, the type of activity; growth rates of product sales; working capital structures; the fate of added value in the price of the product; inflation; accounting policy enterprises; billing systems and so on. So, the stability of development becomes a derivative, and it can be said without exaggeration, a direct consequence of the stability of the current economic activity of the enterprise.

Introduction.

In modern economic conditions the activity of each economic entity is the subject of attention of a wide range of participants in market relations interested in the results of its functioning.

In order to ensure the survival of an enterprise in modern conditions, management personnel must, first of all, be able to realistically assess the financial condition of both their enterprise and existing potential competitors. Critical importance in determining the financial condition of the enterprise consists in a timely and high-quality analysis of financial and economic activities.

The goal of any enterprise is profit, which, accordingly, is also the most important object of economic analysis. However, the amount of profit itself cannot characterize the efficiency of the enterprise's use of its resources. One of the main indicators characterizing the efficiency of the enterprise is profitability. Profitability, in a general sense, characterizes the expediency of the resources expended in relation to the newly acquired (profit) resources.

Profitability and profit are indicators that clearly reflect the efficiency of the enterprise, the rationality of the use of its resources by the enterprise, the profitability of activities (production, business, investment, etc.).

The company sells its products to consumers, receiving cash proceeds for it. But that doesn't mean making a profit. To identify financial result it is necessary to compare revenue with the costs of production and sale, i.e. with the cost of production.

The company makes a profit if the revenue exceeds the cost; if the revenue is equal to the cost, then it is only possible to reimburse the costs of production and sales of products, and there is no profit; if the costs exceed the revenue, then the company receives a loss, i.e. negative financial result, which puts him in a difficult financial situation, not excluding bankruptcy. To maximize profit and avoid bankruptcy, it is necessary to study profit indicators, factors affecting it, and the profitability indicator, which reflects the effectiveness of current costs and is a kind of synthesis of various qualitative and quantitative indicators.

The concept and economic content of profitability

One of the most important indicators of the company's activity is profitability.

Profitability is a general indicator that characterizes the quality of the work of an industrial enterprise, since for all the value of the mass of profit received, the most complete qualitative assessment of the production and economic activities of an enterprise is given by the value of profitability and its change. It is the ratio of profit to production assets or to the cost of production. The profitability indicator evaluates the efficiency of production and its costs.

The main factors that have a direct impact on increasing the level of profitability in enterprises include:

1. Growth in production volume;

2. Reducing its cost;

3. Reducing the time of turnover of fixed production assets and working capital;

4. The growth of the mass of profits;

5. Better use of funds;

6. The pricing system for equipment, buildings and structures and other carriers of fixed production assets;

7. Establishment and compliance with the norms of stocks of material resources, work in progress and finished products.

In order to achieve a high level of profitability, it is necessary to systematically and systematically introduce advanced achievements in science and technology, to effectively use labor resources and production assets.

According to the method of calculation in the national economy, there is a profitability of enterprises R pr. and profitability of products R prod. The first indicator is defined as the ratio of balance sheet profit P to the average annual cost of fixed assets F op and working capital F about:

R pr \u003d (P / (F op + F o)) x 100% (6)

The second indicator of profitability is expressed by the ratio of the balance sheet profit P to the cost of finished products C:

P pr \u003d (P / C) x 100% (7)

Methods for determining profitability clearly show that the level of profitability and its change are directly related to prices for industrial products. Therefore, an objective pricing system is an important prerequisite for determining a reasonable level of profitability, which at the same time can influence the change in the price level for products. Thus, reasonable methods for establishing and planning profitability are closely related to the pricing system. The amount of profit, and hence the level of profitability, primarily depends on changes in product prices and its cost.

In the concept of profitability of production, the accumulations created in the process of manufacturing products are compared with the production funds originally allocated to this enterprise. The profitability of production serves as a measure of the effectiveness of the use of funds at the disposal of the enterprise.

The economic meaning of the profitability of production is not limited to reducing the cost of living and materialized labor for the production of a unit of output. The mass of funds involved in the production process differs significantly from their quantity, which is included in the amount of costs associated with the manufacture of products. The production process involves a huge amount of fixed assets materialized in buildings, structures, equipment and inventory. The costs of production include their depreciation, that is, the share of their value transferred in a given period of time to the cost of production. The cost of working capital will be included in production costs only in the amount spent in the manufacture of products.

To increase the profitability of production, various means are used. One of the main sources of growth in the profitability of production is an increase in the amount of profit received by the enterprise. This growth is achieved as a result of lower production costs, changes in the structure of manufactured products and such an increase in the scale of production when, while maintaining the amount of profit received from the sale of a unit of each type of product, total amount profit earned is growing.

The main driver of profit growth is the reduction in production costs. However, a number of other factors influence the amount of balance sheet profit - a change in product prices, the amount of the balance of unsold products, sales volume, production structure, etc. The first factor is taken into account only in cases where there are sufficiently sharp reasons to believe that a change will occur in the coming period prices (their increase in connection with an increase in the quality of products or a decrease due to the aging of certain types of products, the saturation of the consumer market with certain products or in connection with the transition to new equipment and production technology). Increasing the profitability of production means an increase in the return on each hryvnia of advanced funds and, thereby, their more efficient use.

Profitability indicators are important characteristics of the financial results and performance of the enterprise. They measure the profitability of an enterprise from various positions and are grouped according to the interests of the participants in the economic process, market exchange.

Profitability indicators are important characteristics of the factor environment for the formation of profit (and income) of enterprises. For this reason, they are mandatory elements of comparative analysis and assessment of the financial condition of the enterprise. When analyzing production, profitability indicators are used as an instrument of investment policy and pricing.

System of indicators of profitability.

Profitability indicators are the main characteristics of the efficiency of the economic activity of the enterprise. They are calculated as a relative indicator of the financial results obtained by the enterprise for the reporting period. The economic content of profitability indicators is reduced to the profitability of the enterprise. In the process of profitability analysis, the level of indicators, their dynamics are studied, a system of factors influencing their change, their quantitative assessment is determined.

The main indicators of profitability can be grouped into three groups:

indicators of profitability of capital (assets);

indicators of profitability of product sales;

indicators calculated on the basis of cash flows.

First group profitability indicators is formed as the ratio of profit to various indicators of advanced funds, of which the most important are: all assets of the enterprise; investment capital (own funds + long-term liabilities); share (own) capital.

For example,

The specification of these indicators is that they meet the interests of all participants in the business of the enterprise. For example, the administration of an enterprise is interested in the return (profitability) of all assets (total capital); potential investors and creditors – return on invested capital; owners and founders - return on shares, etc.

Return on assets indicators are calculated as the ratio of profit indicators to indicators of average assets of the enterprise for the reporting period. Return on assets is the most important indicator of the effectiveness of a commercial organization, the main standard (i.e., the average value in a market economy), with which the individual indicators of enterprises are correlated to justify their competitiveness. Such a rate of return (or rate of return), as the ratio of accounting profit (profit before tax) to the total value of assets, is the main indicator of inter-industry competition, the main indicator for determining the effectiveness of investment projects. The rate of return (or the rate of profit) tends to decrease at the present time as well. According to foreign institutes of economic analysis, it is approximately 18-20%. Hence, in the world market economy, a coefficient of 0.20 is often used to determine effective projects.

Each of the listed indicators is easily modeled by factor dependencies. Consider the following dependency:

Where is net profit;

K - all assets;

N - sales.

This formula shows the relationship between the profitability of all assets, profitability of sales and asset turnover. The formula directly indicates ways to increase profitability: with a low profitability of sales, it is necessary to strive to accelerate the turnover of assets.

Consider another factorial model of profitability:

Where is own funds (capital).

As you can see, the return on equity (equity) capital depends on changes in the level of profitability of products, the rate of turnover of total capital and the ratio of equity and borrowed capital. The study of such dependencies is of great importance for assessing the influence of various factors on profitability indicators. From the above dependence it follows that, other things being equal, the return on equity increases with an increase in the share of borrowed funds in the composition of total capital.

Second group indicators is formed on the basis of calculation of levels of profitability in terms of profit, reflected in the reporting of the enterprise. For example,

Note that the arrow points to the logic of generating profit indicators.

The increase in profit can be associated with both intensive and extensive use of production resources. Therefore, the indicator of true efficiency can only be the profitability of sales, i.e. the ratio of profit to sales revenue.

Depending on the numerator, reflecting certain aspects of economic activity, there are:

,

Where - profit from sales;

N - sales proceeds in net selling prices (line 010 f. No. 2 of the income statement);

2. Profitability of probazh according to accounting (before tax) profit

Where - accounting profit(p. 140 No. 2);

3. profitability of sales by net profit ():

Where
- net (retained) profit (line 190 f. No. 2).

In management accounting and analysis, the return on sales indicator is used as the ratio of profit from sales to the cost (full or production) of product sales ( ):

,

Where - cost of goods sold.

(continued page 199)

Third group profitability indicators are formed similarly to the first and second groups, however, instead of profit, net cash inflow is taken into account.

These indicators give an idea of ​​the degree of the company's ability to pay creditors, borrowers and shareholders in cash in connection with the use of cash inflow. The concept of profitability, calculated on the basis of cash, is widely used in countries with developed market economies. It is a priority, because operations with cash flows that ensure solvency are an essential sign of the “health” of the financial condition of an enterprise.

The variety of profitability indicators determines the alternative search for ways to increase it. Each of the initial indicators is decomposed into factor system with varying degrees of detail, which sets the boundaries for identifying and evaluating production reserves.

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When assessing the levels of profitability, the following indicators are used:

the overall profitability of production, calculated as the ratio of balance sheet profit to the average annual cost of fixed assets, inventories and costs;

profitability of products sold, calculated as the ratio of profit from products sold in the wholesale prices of the enterprise.

The analysis of the level of profitability is carried out according to the elements included in the formula, i.e. the influence of changes in the amount of profit from the sale of the cost of OPF and NOS at the level of profitability is revealed. Such an analysis often distorts the economic meaning, since by themselves, the values ​​of fixed assets and normalized working capital do not show the effectiveness of their use. Any increase in the cost of fixed assets reduces the level of profitability.

The study of factors affecting the profitability of production is carried out in dynamics (in comparison with data for previous years).

The profitability of products must be analyzed in dynamics over a number of years, identifying the influence of relevant factors.

Factors that mainly affect the profitability of production include:

profitability of sold products;

the coefficient of capital intensity of products;

coefficient of fixed assets.

Let us now consider these factors in more detail.

The factors affecting the profitability of production include the profitability of sales, the capital intensity of products (capital productivity), the coefficient of fixing working capital (turnover of working capital). To identify the influence of these factors, we will transform the formula for calculating the profitability of production:

We divide both the numerator and the denominator by the amount of revenue from product sales:

We get R - the profitability of sales, or the share of profit per 1 rub. sold products; Fe - capital intensity, which can be obtained as 1/H; H - the level of capital productivity; Kz is the fixing coefficient, which can also be found as 1/K; K - turnover ratio.

The study of factors affecting the profitability of production is carried out in dynamics (in comparison with data for previous years). Assessing the influence of these factors, the following calculations should be performed. General change in production profitability (DRpr):

Including:

1) due to a change in the profitability of products -

2) due to changes in the capital intensity of products (capital productivity):

3) due to a change in the coefficient of fixing (turnover) of working capital:

The total value of the influence of three factors will give a general change in the profitability of production:

Let us consider the above analysis technique for specific example(Table 1.1).

The level of production profitability for the reporting year increased by 0.84 points: DRpr = 12.93-12.09=0.84. The influence of individual factors was as follows.

1. An increase in the profitability of sold products (works, services) led to an increase in the level of production profitability by 0.31 kopecks. for every ruble of resources used:

2. Decrease in capital intensity, i.e. an increase in the return on assets of fixed production assets, led to an increase in the profitability of production by 0.47 kopecks. for every ruble:

Table 1.1. Profitability of production and factors determining it for the enterprise for the year

3. Decrease in the coefficient of fixed working capital, i.e. the acceleration of their turnover, led to an increase in the profitability of production by 0.06 kopecks:

Thus, the overall increase in profitability for all analyzed factors

for every ruble of resources used.

This is the overall change in the profitability of production compared to the data for the previous year (12.93-12.09 = 0.84 kop.)

The profitability of individual products depends on their market prices and cost.

We will consider the influence of these factors in the following example (Table 1.2).

Table 1.2. The influence of the market price and cost of a product on its profitability

The profitability of the product increased by 2%, this change was influenced by an increase in prices and an increase in the cost of production. To determine the influence of each factor, we will perform the following calculations.

where DR(P) - change in the profitability of the product as a result of price changes; economic financial profitability competitive

Conditional profitability of the product at the basic cost and the price of the reporting year;

Consequently, the increase in the market price led to an increase in the profitability of the product by 10.6%.

The increase in the cost of the product reduced its profitability by 8.6%.

The total change in profitability for both factors was (%): 10.6+(-8.6) = 2, which corresponds to the data in Table. 1.2. (Note that the alternative analysis yields)

Thus, conducting a deep financial analysis activities of the enterprise will determine the potential of the company, their compliance with the prevailing market conditions.