Dynamics of relative indicators of liquidity and solvency

Indicators	Indicator value		Absolute deviation (+, -)
	At the beginning of the reporting period	At the end of the reporting period
Absolute liquidity ratio	0.006	0.003	-0.003
Quick ratio	3.54	2.49	-1.05
Current ratio	1.92	1.45	-0.47

The analysis of the relative liquidity and solvency for the 2012-2013 Five years showed that at the beginning and at the end of the reporting period, the company has a very low level of liquidity. The trend towards reduction in the absolute liquidity is negative. Growth factors and critical current liquidity is also a bad thing for the company.

8. Analysis of business activity

Analysis of the dynamics of general indicators of economic activity of enterprise carry out by the following general indicators: the amount of capital invested in the activities of the company (asset value), net income (revenew) from the sale of products (goods and services), net profit, comparing to the rate of change of these indicators for several periods. Analysis of the dynamics of general indicators of economic activity of enterprise is provided in analytical table (Table 14):

Table 14

The dynamics of overall performance of economic activity

Indicators	Previous period	Reporting period	Growth rates, %
Average annual amount of invested capital (average annual value of assets), ths. UAH	438244.5	479034	109.3
Income (revenue) from sales of products (goods and services), ths. UAH	989053	978530	98.94
Net profit ths UAH	41252	28076	68.06

Inequality G_r^a < 100% (68.06%) means that the economic potential of the company and the scale of activity is decreasing. Inequality G_rⁱ > G_r^a (98.94% > 68.06%) indicates that the growth rate of net income are higher than growth rate of economic potential, ie per every hryvnia of additional capital company receives more than one hryvnia return. Inequality G_r^p > G_rⁱ (109.3 % > 98.94 %) indicates that the growth rate of net profit exceeded growth of net income and economic growth potential.

Evaluating the effectiveness of the use of enterprise resources is performed using the following key financial ratios: asset turnover ratio, turnover ratio of fixed assets, inventory turnover ratio, average length of turnover of receivables, turnover ratio of receivables, turnover ratio of payables, average length of turnover payables and others. Analysis of the dynamics indicators of business activity of enterprise is provided in analytical table (Table 15):

Table 15

Dynamics of indicators of business activity

Indicators	Previous period	Reporting period	Absolute deviation (+, -)
1. Baseline data indicators for calculating
Net income (revenue) from sales of products (goods and services), ths. UAH	989053	978530	-10523
Prime cost of sales (goods and services), ths. UAH	914902	910920	-3982
The average value of assets, ths. UAH	438244,5	479034	40790
The average value of fixed assets, ths. UAH	234283	271492	37209
The average value of stocks, ths. UAH	110751,5	84037,5	-26714
The average cost of receivables ths UAH	167070,5	95506,5	-71564
The average cost payable, ths UAH	84082,5	94226	10144
The average cost of equity, ths. UAH	346823	382036	35213
2. Indicators of turnover	2,257	2,043	-0,214
Turnover ratio of assets	4,222	3,604	-0,617
Turnover ratio of fixed assets	8,930	11,644	2,714
Turnover ratio of stocks	5,920	10,246	4,326
Turnover ratio of receivables	60,811	35,137	-25,674
The average length of turnover receivables days	11,763	10,385	-1,378
Turnover ratio of payables	30,605	34,666	4,061
The average duration of turnover payables days	2,852	2,561	-0,290
Turnover ratio of equity	989053	978530	-10523

As we see, almost all indicators have a negative meanings. It means that activity of enterprise is not very effective. Decreasing of turnover ratio of fixed assets reduсes net income (revenue) from the sale of products (goods and services) per unit of fixed assets value. Turnover ratio of receivables decreased, so turnover costs of the enterprise increased.