Financial Structure Elasticity On The Impact Of Financial Risk Analysis

To China’s enterprises, especially listed companies, it is in theparticular need to disclose more important information because of thechanging business environment. In the face of uncertainties, companiesmust continue to strengthen risk control awareness. As a result, the mostcombined effects of various risk eventually reflect in the financialinformation, control and management of financial risks become manyscholars and managers’ focus. Traditional financial risk involved infinancial difficulties, bankruptcy risk, cash flow, financing andinvestment, corporate governance and other aspects with both normativeresearch and empirical research, but China has not yet formed an elasticresearch system of the financial structure. There are less scholars viewingthe financial risk from the point of financial structure elasticity, and themanagers do not pay enough attention to the elasticity of financialstructure. So here comes what this article research on: from the point offinancial structure elasticity, using the methods of empirical research toexplore how the financial structure elasticity have an impact on thefinancial risk on the basis of not only the results of various scholars butalso the flexible theory and the theory of uncertainty. There are certaintheoretical and practical value to further understand and solve theproblem of financial risk.Basing on the learning and summarizing the research literature of domestic and foreign scholars and what our company’s financial system isfacing, we collected the status quo to the empirical data for the ShenzhenA-share manufacturing of314listed companies in the period2008-2010as the study sample, selected the Z-score model financial risk quantifiedas the dependent variable. The establishment of the financial structure ofan elastic index system was based on the selected sample of elasticity ofassets and capital from the asset structure elasticity and capital structureelasticity. Four independent variables included the monetary funds/totalassets, trading financial assets/total assets, temporary short-term funding/total capital and convertible debt/total capital which were separatelyselected from the asset structure elasticity and capital structure elasticity.Then an empirical test analysis was carried out using mixed panelregression method. Finally, according to our empirical test results, thisarticle presents reasonable proposals to resist financial risks, such as thereasonable arrangement of elastic assets, broaden the elastic capitalfund-raising channels, dynamic regulation of the financial structure ofelastic mechanisms and enhance the policy recommendations of thepotential ability.