Financial Risk Analysis And Control Research Of CQ Company

Under the environment of market economy, financial risk is an unavoidable objective existence in any enterprises. Our country is in the overall economic downturn and the crucial stage of deepening reform of economic system, the importance of financial risk management of the company is growing at the same time. The responsibility of the enterprise management is to analyze the comprehensive financial risk level, to identify the financial risk from each specific dimension, to find its specific causes, in order to take corresponding measures to prevent and control it so as to avoid the deterioration of the loss and keep the enterprise in a healthy development path.Based on the theories of financial analysis and control, the author analyzed the financial risk of CQ company in an overall view and breakdown view. On the basis of an introduction to the CQ company’s background and financial information, the author evaluated the overall financial risk of CQ company using Zeta-score model and Free Cash Flow method. The results showed that the CQ company has a big financial risk problem. Then, this paper divided the whole financial risks into five dimensions: financing risk, investment risk, cash flow risk, working capital occupation risk, and guarantee risk. By using financial ratios this paper analyzed the five kinds of risks in horizontal and vertical way, and revealed the internal cause of all kinds of risks. According to the result of the financial risk analysis, this article puts forward some suggestions on the control of CQ company’s financial risk measures at the end.In this paper, the CQ company’s analysis shows that the company’s financial risk level is remarkably high, the author suggested CQ company to establish a correct concept of financial risk, to strengthening the cost control of, to strengthen the management of accounts receivable, to implement strict inventory management, to integrate investments, and to diversified financing methods. At the same time, the author suggested CQ company to establish and improve the cash flow risk pre-warning index system, strengthen the internal control of guarantee, in order to control the company’s financial risk at a reasonable level so as to help the company realize its overall strategy.