Theoretical and Methodological Approach to Assessing the Probability of Bankruptcy of Enterprises in Economic Sectors
Authors:   Institute of Economics UB RAS, Yekaterinburg, Russian Federation, Naumov I. V. , Bychkova A. A. ,   Institute of Economics UB RAS, Yekaterinburg, Russian Federation, Nikulina N. L. ,   Institute of Economics UB RAS, Yekaterinburg, Russian Federation
Published: December 2024

In the context of the rapidly changing geopolitical situation and sanctions pressure on the Russian economy, it is critically important to assess the financial stability of enterprises, forecast the risks of decline in their financial solvency and the probability of bankruptcy in order to make effective management decisions on the development of economic sectors in the constituent entities of the Russian Federation. Currently existing methodological approaches to analyzing the probability of enterprise bankruptcy do not allow to fully assess the financial condition of economic sectors in the regions of Russia. The purpose of the work is to identify the advantages and disadvantages of the methods used in practice to analyze the financial solvency of enterprises and their adjustment to forecast the probability of bankruptcy of enterprises in the constituent entities of the Russian Federation. The novelty of the developed methodological approach is the use of multidimensional discriminant analysis of the probability of bankruptcy of enterprises in a specific sector of the economy in a constituent entity of the Russian Federation according to the modified Altman model, which eliminates the factor characterizing the ratio of the market value of shares of all enterprises in the industry to the sum of all liabilities, as well as the calculation of integral values of the probability of bankruptcy of enterprises in the industry with a breakdown into large, medium and small enterprises to study the scale of threats to financial solvency, taking into account industry specifics. In the course of the research the following results were obtained: an original methodological apparatus for assessing the probability of bankruptcy of enterprises in various sectors of the economy was developed, including the calculation of individual threshold values for each sector in the region based on the dynamics observed over a long period of time; zones of probability of bankruptcy of enterprises were determined. The resulting methodology was tested at enterprises of water supply, wastewater disposal, waste collection and utilization and pollution elimination in the Sverdlovsk region. The analysis of their financial condition revealed an increased probability of their bankruptcy. Moreover, the most vulnerable were both the largest and small enterprises which have insufficient liquidity of assets, lack of working capital and developing mainly at the expense of borrowed funds and attracted loans. As a result of the study, not only the insufficient level of financial stability and solvency of water supply, wastewater disposal, waste collection and utilization and pollution control enterprises in the Sverdlovsk region, but also a decreasing in the level of asset turnover and especially accounts receivable, as well as a high level of their debt load, were identified/designated (as the first/main signs of the threat of bankruptcy). The methodology modified by the authors allows to timely determine the probability of bankruptcy for all enterprises (large, medium, and small) taking into account the industry specifics and to initiate appropriate measures to prevent the critical financial condition of enterprises.