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Problems with the application of conventional financial ratios in corporate risk measurement
5-12Views:169One of the enterprises’ biggest fears is a potential bankruptcy situation. This is the reason there are a lot of people who try to anticipate it. To be aware of the actual and expected future situation of a company is in the interest of all those who are related. This topic has come to the fore after the economic and financial crisis of 2008. Companies, their creditors and internal stakeholders should be aware of the liquidity and solvency situation of a given company, because its deterioration can cause serious problems for all of them. During the financial analysis of companies, the problem of liquidity indicators showing bad signals can often be experienced, although there is no visible sign of difficulty in their operation. In other cases, the situation is just the opposite, i.e. liquidity ratios are adequate, but still, the business faces payment issues. How could it happen? The purpose of this study is to present indicators which can measure more accurately and reliably the actual liquidity position of a company.
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The influence of direct support under common agricultural policy on farm incomes in Poland
33-37Views:141The main objective of the paper is the analysis of changes on the level of income of agricultural producers, which took place in Poland in the early years of the accession to the EU, as well as a determination of the scale of the impact of financial support under the Common Agricultural Policy on the farm income situation. Poland’s membership in the EU gives rural farms opportunities to improve their economic situation. Financial aid, mainly in the form of a direct payment, has been the main factor determining the economical status of rural farms, whilst the other income making factors, such as improved productivity and increased agricultural production have played a much smaller role. The increase in revenue has enabled farmers not only to increase current expenditures, but also to carry out modernization efforts, which will determine the future economic and structural situation of the Polish agricultural sector and its competitiveness. However, a strong differentiation in terms of the economic situation of rural farms according to their size and specialization in production was also noticed. As a result, there is a still large number of farms in which the revenues received by farmers are insufficient to assure them adequate life standard. Therefore such farms are not able to both develop and invest. Only economically strong rural farms with high production potential have such opportunities, meaning that EU support will never be able to fully minimize the effects of small-scale production or to offset the insufficient efficiency and productivity of production factors.
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Economical aspects of thermal and medical tourism
77-84Views:148Thermal and medical tourism in Hungary are characterised by a continuous development. The management, efficiency, operational effectiveness and offer of enterprises in the field of tourism influence the competitiveness of Hungary’s tourism. In the present day economic life the thorough analysis of the enterprises’ economy is indispensable. The result of the analytical methods applied by the report provide information for different stakeholders (owners, transporters, customers, employees, habilitators). The aim is to have data which inform us about the functioning, financial situation and profitability of the economic entities parallel with the factors and conditions determining these elements. In our paper we present the financial situation of the Demjén Thermal Spa Ltd., being one of the newest thermal spas of Hungary.
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The economic situation of Hungarian crop production enterprises, especially in Hajdú-Bihar county
Views:171Increasing the competitiveness of Hungarian crop production plays a key role in moving forward at the international level. However, improving efficiency and profitability is essential in this regard. The natural resources in Hungary provide an excellent opportunity for crop production. About 8% of the arable land in Hungary (a total of 4.3 million hectares) belongs to farmers in Hajdú-Bihar County. This research is based on secondary data that can be found in the HCSO and EMIS databases. HCSO data was used for the comparison of national and county data characterising crop production, while the EMIS database was used to process the financial data of enterprises dealing with field crop production. The Hungarian sample size is 853, of which 69 enterprises are from Hajdú-Bihar County. The aim of this study is to assess the profitability, assets and financial situation of arable crop production enterprises operating in Hajdú-Bihar County as a function of national average data. Based on the examined profitability indicators (operating ROS and ROA), it was established that the enterprises in Hajdú-Bihar County are profitable, even in a national context. In terms of operating ROS, the farms in the examined county were able to achieve a 3.6 percentage point higher value due to their more efficient cost management, despite having a similar level of technology compared to businesses spanning across the entire country. The proportion of farms with the lowest leverage ratio (<20%) is 16 percentage points higher at the county level than at the national level. In addition, almost 70% of the enterprises operating in Hajdú-Bihar County have excellent liquidity. This rate is 50% at the national level.
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Information content of a sports undertaking’s statements serving different purposes – particularly with reference to the player rights
119-133Views:168In the 21st century, sport is not just a fun, social cohesive force but also a business; it has become an independent industry by now and several countries possess developed sport markets. According to estimates, sport accounts for 4% of the EU’s GDP. The actuality of our research is given by the fact that the economic aspect of sports develops continuously which is also due to that more and more amounts already stream into sports in our days. In Hungary, sport is mainly state aided and has mostly financing problems while the sport businesses existing in the more developed Western Europe are principally sponsored by the private sector. The government considers sport as a strategic branch (HERCZEG et al, 2015) and manages as such because they see the international breakthrough potencies in sport as well. Sport companies must also adapt the business-based thinking, which requires the strategic planning and operation (BECSKY, 2011). The research covers the subject of economic approach of the players’ rights. The task of accounting is to give a true and fair image about the property, income and financial situation of an undertaking. Information provided by accounting is essential for both the management decisionmaking and the market operators. In Hungary, the sports undertakings, as each managing entity, have to prepare their statements according to the Act C of 2000 on Accounting (AoA.) (NAGY – BÁCSNÉ BÁBA, 2014). The purpose of this research is to examine how a domestic sports undertaking demonstrates the value of available players in the books and how the incomes and expenditures incurred with the players are accounted for, based on the regulations of the Hungarian, international associations and the Union of European Football Associations (hereinafter: UEFA). In order that the leaders of the businesses can make quick and appropriate economic decisions, it is essential in this intensively changing world that an enterprise should have a well-functioning accounting system based on up-to-date information. International Financial Reporting Standards (hereinafter: IFRS) are intended to provide the comparability across borders. Firstly, we deal with the accounting reporting system, both the Hungarian, international financial reporting standards and, relating to UEFA, the investigation of the intangible assets to a great extent during analysing the balance sheets. Then, we examine the income statements from the viewpoint player transfers. To what extent the rules of a statement laid down by UEFA differ from the ones of a statement prepared according to AoA? What is the difference in domestic and international relations? In this study, we search after the answers for questions mentioned before.
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New tools and opportunities in growth and climate friendly greening for small and medium enterprises in the European Union
25-31Views:158The role of Small and Medium Enterprises (SMEs) is unquestionable in the European economies, while financial opportunities are still inadequate for them. The more than 20 million SMEs play a significant role in European economic growth, innovation and job creation. According to the latest EC Annual Report , SMEs are accounting for 99% of all non-financial enterprises, employing 88.8 million people and generating almost EUR 3.7 tn in added value for our economy. Despite the fact that there is plenty of EU funding available for these SMEs, for certain reasons these funds hardly reach them. But we have to see that the EU supports SMEs by various way, e.g. by grants, regulatory changes, financial instrument, direct funds. On the other hand, SMEs and decision makers realised that the environmental sustainability has to be attached to the economic growth, therefore more and more tools are available for these enterprises. Over the last few years, public institutions, the market, the financial community and non-governmental associations have explicitly demanded that firms improve their environmental performance. One of the greatest opportunities might lay in the Climate- and Energy Strategy till 2030 as 20% of the EU budget is allocated to climate-related actions, however the easy access to finance is still a key question. Does the EU recognise the actual difficulties? Is there a systemic reason behind the absorption problems? Is the EU creating a more businessfriendly environment for SMEs, facilitating access to finance, stimulates the green and sustainable growth and improving access to new markets? The paper analyses the current European situation of the SMEs and the effectiveness of some new tools, which are specially targeting SMEs.
JEL classification: Q18
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Some aspects of accounting and management accounting during economic downturns
33-35Views:149Economic slowdown and downturn creates new situation for every organisation, no one can avoid facing to new situation created by the global financial-, and economic crisis.All of the organisational function should reconsider its own role within the company due to the new circumstances, Accounting and Mangement Accounting can not be exception, but they have more complex and emphasized role in these difficult times. In the following paper I can not avoid to mention some general statement about importance of accounting and accounting principles, while there are a number of criticalaccounting and financial reporting issues that accountants and auditors should consider.In the framework of the paper I can not face with all relevant issues of the topic, but after some general statement I would like to highlight some special area regarding to management accounting, which can be more important during these challenging time for decision makers and accountants.Regarding to balance sheet analysis its important to mention current debate about fair value comparing with historical cost from accounting point of view, on the other hand from the view of management reporting system I would like to highlight the importance of working-capital indicators. More practical topic is the crucial role of budgeting and forecasting during economic downturns, and at the end I would like to show why it is more important monitoring price variance and indirect cost allocation in these uncertain business circumstances.
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Analysis the advanced ICT usage of the Hungarian SME sector for preparing a domestic agri-food research
147-153Views:164In the Hungarian agro-food sector SMEs have a key role but regarding the tendency of the performance of SME sector, comparing to EU-28 average, the performance of Hungarian SME sector has gradually worsened between 2008 and 2015 while the EU average has an increasing trend. ICT can help enterprises and this article is an overview of the ICT situation of Hungarian SMEs. It is important to analyse in detail the ICT usage characteristics of agro SMEs in the food supply chain because these ICT devices, tools and services are crucial to smooth the information flow within the chain. For all these reasons our work aims to find out how Hungarian agro-food SMEs use ICT and how ICT adoption affect their business procedures, performance and development. A striking observation to emerge from the data comparison is the difference among SMEs and large enterprises regarding the usage of the different basic and advanced ICT solutions. A much bigger percent of large companies use advanced ICT then SMEs and mainly small enterprises are lagging behind as the attitudes of medium sized enterprises are rather similar to the large ones. In Hungary small enterprises in agro-food industry are in difficult financial state and for them free Cloud Computing services can offer good opportunities as they do not have initial costs. ICT adoption is very important to them as ICT sector is a dynamically growing sector and if customers and partners of an enterprise adapt faster to these technological innovations, it may have a negative effect on the different processes, performance and financial results of the organisation. In this article our aim was to determine the main question groups for our questionnaire which focus mainly on ICT solutions supporting the quality of communication and relationship between partners. As the basic IT tools are available in the major part even in the SMEs besides large companies, the two main issues will be the usage of advanced online services and the usage of high quality ICT solutions.
JEL Code: M15
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Water footprint in Hungary
83-91Views:173More and more news report on water-related extreme environmental phenomena. Some of these are natural, which are often beyond the human race. But others are definitely due to anthropogenic effects. I think the water footprint index is able to highlight national and international water-use processes and gives us the opportunity of organizing a sustainable, consumer-, environmental- and governancefriendly management. 81% of the fresh water withdrawal is from surface water bodies in the EU. In Europe as a whole, 44% of abstraction is used for energy production, 24% for agriculture, 21% for public water supply and 11% for industry. Public water supply is confined to ground waters. To the water resources related human activity caused qualitative and quantitative amortisation will grow worse in the foreseeable future due to the climate change. Beside seasonal differences the sectoral differences are increasingly becoming critical between different areas, such as Southern and Western Europe. The former, wrong agricultural support system has worsened the situation since it gave financial aid for the used improper techniques of water-intensive crop cultivation. By today, this seems to be solved. Public water abstraction is affected by many factors, of which mostly are based on social situation and habits, but technological leakage receives a big role as well. Interesting, that for example the residents’water consumption in Eastern Europe decreased because price were raised and regular measurements were introduced. But in Southern Europe it increased due to tourism in the past period. Industrial water withdrawal decreased across Europe because of the decline of industry and the development of technologies. According to the European Environment Agency (EEA), the Union needs a sustainable, demand-driven leadership which focuses on the preservation and use efficiency. This have already appeared in politics and legal administration as well. Current research calls the attention to the significance and difficulties of this kind of domestic estimation presented trough the water footprint calculation of bread and pork in Hungary. The received data indicate the domestic water consumption trends in a modern approach. There is no doubt for me about the urgent necessity of water footprint calculation because as a result innovative, sustainability supported environmental, social, economical, and political relationships can be created – not just on local, regional or national level, but on interregional, European and even global stage.
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Transition economy and happiness the Czech Republic compared with the Netherlands in the 1990- 2004 period
119-126Views:177The paper deals with the subject Transition economy and happiness – a case study of the Czech Republic in a comparison with The Netherlands in the 1990- 2004 period. The paper addresses the following two questions: 1. How has the level of happiness changed since 1990 in the Czech Republic and in The Netherlands? 2. Are there differences with respect to variables that explain differences in happiness between both countries. It appears that. at the beginning of the 1990s of the last century, the Czechs were less happy than the Dutch and, that, people in the Czech Republic were less happy in 1999 than they were in 2004. Furthermore, Happiness in the Czech Republic is approaching the level of happiness in The Netherlands. In both countries happiness is positively affected by subjective health status, perceived freedom of choice over life, being married or living together and satisfaction with one’s financial situation and having trust in social institutions. But there are differences with respect to the impact of age, education and religion .
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Agrarian budget as an instrument of agrarian development policy of Serbia
Views:110Purpose of the research is to emphasize the role of agrarian budget in development of Serbian agrarian economy and to examine the problem of agricultural and rural development financingsupport.Furthermore, in this research initial reforms of economic measures have been analyzed concerning Serbian agrarian policy. The goal of this paper is to provide an insight into the role of agricultural budget in agrarian policy of Serbia.The first part of the study gives an overview of macroeconomic situation in Serbia and impact of the financial crisis on Serbia’s economy. Second part includes analysis of the topic item, i.e. agrarian budget role in Serbian agrarian sector. It includes review of relevant literature and researches already conducted on legislation and practice of Serbian agrarian policy as well as examination of statistical data regarding present agrarian budget for 2009.The research focuses at the Serbian agrarian budget for 2009 and agrarian policy of the present Serbian government administration.
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Economic results of Croatian farms
53-58Views:106The objective of the paper is to provide an overview of the situation and performance of Croatian farms. Croatian farmers rarely keep business books and therefore farm level business data are deficient. Croatian accession to the European Union in 2013 brought numerous innovations to agricultural sector. One is introduction of Farm Accountancy Data Network (FADN) which aims to determine the impact of the Common Agricultural Policy on national agriculture of EU member states. The sample of Croatian FADN comprises 1,250 commercial farms. The paper brings results of agricultural sector financial analysis for the period 2011-2013. Total farm output decreased, but since the stronger decrease trend occurred in total inputs, this led to positive trend of gross and net farm income in the year 2013. Positive results are also shown at efficiency and productivity of Croatian farms. In the years 2011 and 2012 farms operated below the efficiency level while in 2013 efficiency increased above the efficiency level. In the observed period there was a 70% increase in productivity. The analysis shows that the most efficient farms are those in vegetables and flowers type. It also has the highest debt ratio due to their capital intensiveness. The vegetable and floriculture farms have the largest gross farm income in all three analysed years, but with a large drop in 2013, while the farms in type pigs and poultry have largest increase of gross farm income in last observed year.
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The impact of the “greening” of the common agricultural policy on the financial situation of Polish farms
49-55Views:286This paper presents an assessment of the impacts of introducing the greening scenario of the CAP, proposed by the European Commission as an alternative for the reformed CAP after 2013. In the past, the CAP has undergone numerous transformations in response to the changing macroeconomic environment and in reaction to developments in the farming sectors in EU countries. On the 12th of October 2011, the Commission presented a set of legal proposals designed to make the CAP a more effective policy to encourage more competitive and sustainable agriculture and vibrant rural areas. The proposal brings various new elements under consideration, some of them raising strong controversies such as introducing “greening” as a component of direct payments. Changes in the direct payments scheme in line with the EC proposition include forcing adjustments in the cropping pattern and creating ecological focus areas (EFA) on 7% of the farm land ; the consequences of such a proposal on the size and structure of agricultural production, and thus on the economic performance of farms and the whole agricultural sector are uncertain. The authors analyse historical changes to the CAP with a focus on a growing importance of the environmental component of the CAP, discuss different scenarios of shaping the direct payments system and present the results of modelling the impacts of greening the CAP on the Polish farming sector with the use of the LP optimisation model. The study was based on Polish FADN data. Results show that the majority of farmers in Poland comply with the crop diversification constraint of greening. However, establishing the required EFAs and necessary diversification on farms with simplified cropping structures will have a negative impact on the volume of agricultural production as well as on farm incomes.
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